·U.S. federal budget deficit will hit an all-time high of $1.2 trillion in the 2009 fiscal year.

·The estimate doesn't include the cost of a huge economic stimulus bill.

·The CBO also projects that the U.S. economy will shrink 2.2 percent this year.

    WASHINGTON, Jan. 7 (Xinhua) -- The U.S. federal budget deficit will hit an all-time high of 1.2 trillion dollars in the 2009 fiscal year, which ends on Sept. 30 this year, the Congressional Budget Office (CBO) estimated Wednesday.

    The estimate doesn't include the cost of a huge economic stimulus bill that U.S. President-elect Barack Obama is seeking approval from Congress. The bill would total nearly 775 billion dollars over next two years, according to news reports.

    The 1.2-trillion-dollar deficit shatters the previous record of 455 billion dollars set last year. It also represents more than 8 percent of the size of the economy, which is higher than the deficits of the 1980s.

    Meanwhile, the CBO also projects that the U.S. economy will shrink 2.2 percent this year and recover slightly in 2010. It expects the nation's unemployment rate to surge to over 9 percent early next year unless the government takes actions.

    "The recession -- which began about a year ago -- will last well into 2009," the CBO said.

    In the 2007 fiscal year, the federal deficit dropped by 34.4 percent to 162 billion dollars, a five-year low since an imbalance of 159 billion dollars in 2002, reflecting faster growth in government revenues than spending.

    The 2002 performance marked the first budget deficit after four consecutive years of budget surpluses.

    After meeting with his economic team on Tuesday, Obama said that it was possible that trillion-dollar deficits could stretch into coming years and that he and his team want to instill a "sense of responsibility" about future budget choices.

    "I'm going to be willing to make some very difficult choices in how we get a handle on this deficit," the president-elect said.

    He is to deliver a speech on Thursday about the economy.

Obama names "chief performance officer" to control federal budget

   WASHINGTON, Jan. 7 (Xinhua) -- U.S. President-elect Barack Obama Tuesday named a "chief performance officer," a newly-created position that would oversee the federal budget and reform government.

    "We can no longer afford to sustain the old ways when we know there are new and more efficient ways to getting the job done," Obama told a news conference at his transition headquarters in Washington as he named Nancy Killefer for the post, "an expert in streamlining processes and wringing out inefficiencies." Full story