CBO: Federal deficit projected at $1.35T

WASHINGTON (AP) - The Senate on Tuesday rejected a plan backed by President Barack Obama to create a bipartisan task force to tackle the federal deficit this year, despite glaring new figures showing the enormity of the red-ink threat.

The special deficit panel would have attempted to produce a plan combining tax increases and spending curbs to be voted on after the November elections.

The vote to kill the deficit task force came hours after the nonpartisan Congressional Budget Office predicted a $1.35 trillion deficit - $4,500 for every American - for this year as the economy continues to slowly recover from the recession.

The budget deficits facing Obama and Congress are large and intractable, and the CBO's new deficit prediction is roughly equal to last year's record $1.4 trillion ocean of red ink. That means the government is borrowing to cover 40 percent of the cost of its programs.