federal budget deficit

Wild optimism about economic growth is at the heart of the Obama administration's plans to shrink the federal budget deficit. And that's not the only problem.

Instead of the $240 billion taxpayers were expected to lose from the bank bailout, Fed chief Bernanke says it will only be $40 billion.

That leaves $200 billion to help pay down the federal budget deficit, right? Maybe not. John Dimsdale reports.

The federal budget deficit increased in June as spending surged and tax receipts sunk, pushing the total budget shortfall to over $1 trillion in the first 9 months of the fiscal year, according to a government report released Monday.

The federal budget deficit surged in May, bringing the total shortfall for this fiscal year to nearly $1 trillion, government figures showed Wednesday.

The federal budget deficit for 2009 is projected to be three times the size it was in 2008. But one thing that amount doesn't account for is President-elect Barack Obama's stimulus plan.

As Bob Moon reports, the deficit may limit what Obama can do to help the ailing economy.