Budget deficit tops $1 trillion for fourth straight year

The 2012 budget gap was $1.089 trillion, narrower than last year's deficit of $1.297 trillion because of higher corporate income tax receipts and less spending, the Treasury Department said on Friday.

The deficit equaled 7.0 percent of U.S. economic output, down from 8.7 percent last year, the department said. Economists generally consider deficits exceeding 3.0 percent of gross domestic product to be unsustainable in the long term.

The year-end budget report comes in the final weeks of the presidential election campaign, where the massive budget gap and President Barack Obama's economic policies have dominated the debate.