WASHINGTON (AP) -- 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.

© 2011 The Associated Press