The federal government is on pace to run a deficit below $1 trillion for the first time in four years, modest progress in the face of intense debate in Washington over spending.

The Treasury Department says the deficit was $137 billion in
October. That brings the total for the first two month of the
budget year to $236 billion.

While high by historical standards, the deficit is $55 billion
lower than the same two months last year. The government is also on
pace to end the year $973 billion in the red, according to the
Congressional Budget Office.

Still, many expect that to change this month if Congress extends
a Social Security tax cut and extended employment benefits. Both
expire at the end of this month.

(Copyright 2011 by The Associated Press. All Rights Reserved.)