Those of us hoping for the budget to move into balance in time for next year's election didn't get any help from the Treasury's October numbers. If the current trends for tax receipts and spending continued, the budget wouldn't balance until August of 2009. Click to enlarge.
The biggest contributor to the sluggishness seems to be that corporate tax receipts have flattened. I've heard some positive anecdotal news about corporate earnings and about 3rd quarter GDP growth (soon to be revised upwards to 5%); with luck, that will get corporate tax receipts growing again. We'll need something significant to get the crossover date back into election year.