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US Government Seeks Higher Debt Limit - 2004-10-14

The U.S. budget deficit swelled to a record $413 billion at the end of September.

The Treasury Department report says it is the second year in a row the deficit has been a record.

President Bush, a Republican, blames the budget problems on the 2001 recession and the cost of the war in Iraq. His Democratic opponent John Kerry calls the shortfall a threat to the economy caused by Mr. Bush's tax cuts.

In a separate report Thursday, officials said the U.S. government has borrowed nearly all the money it can, according to a law limiting debt to $7.4 trillion.

Treasury officials will temporarily suspend payments to a retirement fund for government workers to avoid exceeding the limit. Congress is expected to raise the debt limit next month.