MercoPress. South Atlantic News Agency

Record US budget deficit.

United States federal budget deficit is forecasted to reach a record breaking 422 billion US dollars in 2004, according to the Congressional Budget Office, CBO. However the figure is below earlier estimates.

Last July the White House admitted that the fiscal year deficit could reach 445 billion US dollars. In 2003 the federal budget deficit was 375 billion US dollars.

When the final numbers are made public the whooping deficit is expected to become a controversial issue of the current presidential electoral campaign. Democrats arguing that it's the result of disastrous economic policies from the Bush administration while the Republicans will emphasize that the US economy is finally beginning to recover following significant tax cuts.

When President Bush reached the White House in 2001 the federal government had an accumulated surplus of several years equivalent to 537 billion US dollars.

But budget deficits began with the first of President Bush's federal budget and continued in 2002 when the Republicans managed full control of both Houses of Congress.

However in spite of the impressive numbers, the deficit represents 3% of GDP, less than the 4% of GDP of 1994.

Employment another crucial issue for the November 2 presidential election is also showing recovery signals. According to the latest Labor Department statistics unemployment in August was 5,4%, compared to 5,5% last July, which is the lowest reading since October 2001.