The FY2014 budget deficit totaled $486 billion, according to today’s estimates from the Congressional Budget Office (CBO). Although this is nearly 30 percent below the FY2013 deficit and 66 percent below its 2009 peak, the country remains on an unsustainable fiscal path. In this paper, we show: Annual deficits have fallen substantially over the past five years, largely due to rapid increases in revenue (mostly from the economic recovery),  the reversal of one-time spending during the financial crisis, small decreases in defense spending, and slow growth in several other areas. Simply citing the 66 percent fall in deficits over the past five years without context is misleading, since it follows an almost 800 percent increase that brought deficits to their highest levels in post-war history. Even as deficits have fallen, debt has continued to rise, more than doubling as a percent of GDP since 2007 to record levels not seen other than during a brief period around World War II. …”

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