The United States dropped a record $220.9 billion further into the red in February, the Treasury Department reported Wednesday.

The shortfall was up from the previous record $193.9 billion shortfall in February last year.

It’s the 17th straight month that the U.S. government has posted deficits. The last time the government posted a monthly surplus was in September 2008, when the government reduced the deficit by $45.7 billion.

The cumulative deficit for fiscal 2010, which started in October, reached $651.6 billion, up from $589.8 billion in the same period the year before. The Obama administration is forecasting that the deficit will hit $1.56 trillion this year.

Spending increases overshadow revenue boost: Wednesday’s announcement came as little surprise to economists, who expected the deficit for February to total $222 billion, according to a consensus compiled by Briefing.com.

Receipts totaled $107.5 billion, up from $87 billion in February last year and outlays totaled $328.4 billion, up from $281 billion.

Despite the government’s record losses, the year-over-year boost in revenue during February is at least one hopeful sign that the economy is faring better, said Robert Bixby, executive director for the Concord Coalition, a federal budget watchdog group. It was the first time since April 2008 that the government posted higher revenue when comparing monthly data year-over-year.

The overall losses were most likely driven by the recession and tax refunds, said Nathan Topper, an associate economist with Moody’s Economy.com.

February is traditionally a big deficit month for the government, as Uncle Sam starts writing tax refund checks, he said. And because the recession dampens business profits and wages, refunds spike. There were $65 billion in tax refunds recorded in February this year, compared with $77 billion last year and an average of $49 billion for last decade, according to Moody’s Economy.com.

Spending up: The government shelled out $65 billion to Health and Human Services, $62 billion in Social Security expenses and $48.9 billion to the Department of Defense in February. Spending is up in all those departments for the first five months of the government’s fiscal year, over the same period last year.

Corporate income tax refunds were higher than usual because of legislation that allows them to apply current losses against prior profits to become eligle for refunds.

In February, the President Obama signed into a law a record $1.9 trillion increase to the government’s debt limit, bringing the new cap to about $14.3 trillion. To top of page

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Canada said Wednesday it will allow more foreign ownership in its telecommunications sector, a move that could mean more wireless players and lower rates for cell phone service.

In a speech outlining its priorities for the new session of Parliament, the Conservative government said it is opening some sectors, including the telecommunications industry, to investment from outside the country.

Rogers Communications, BCE and Telus, which together control 95 percent of the Canadian cell phone market, have lobbied in the past to prevent foreign ownership.

Industry analysts say the ramifications of the policy shift won’t be known until more details are revealed, possibly as early as Thursday.

Industry Minister Tony Clement recently overturned a ruling that disqualified a new entrant into the wireless market, Toronto-based Globalive Wireless, for having too much foreign participation.

Globalive chairman Anthony Lacavera said he isn’t sure whether the rejection of his company – in which Egyptian telecom giant Orascom has a 65 percent stake – played a role in the federal government move.

Critics of the current system say Canadians pay significantly more for wireless services than people in Europe in the U.S.

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Facing firm demands from the European Union and financial markets to cut its deficit, Greece announced cost-cutting measures Wednesday that will save the debt-challenged country €4.8 billion, $6.53 billion, this year.

The Greek government plans to cut civil service workers’ entitlements by 12%. This includes a 30% decrease in holiday bonus payments, according to The Wall Street Journal’s online edition. Officials also said civil service pensions will be frozen for the year.

To increase revenue, the Greek government said it will raise the value-added tax to 21% from 19% on items including clothing and footwear. Sales tax on food and medicine will rise to 10% from 9% and the tax rate on printed products will increase to 5% from 4.5%.

The country will boost the tax on alcohol by 20% and raise the tax on tobacco to 65% from 63%. Taxes on gasoline prices will be hiked by €0.08 per liter.

Officials expect the measures will reduce Greece’s budget deficit to 8.7% of the country’s gross domestic product this year from a level of 12.7% last year, according to the report. The European Union had given Greece until March 16 to show it is making progress in cutting its deficit from more than four times the allowed level.

Umbrella union for civil servants ADEDY is already speaking out against the measures and has called for a 24-hour general strike on March 16, said the Journal.

In a speech to parliament Tuesday, Greek prime minister George Papandreou said the country risks bankruptcy if it neglects to find lenders to cover its €300 billion, $409 billion, in debt, the Journal said.

Greece is preparing to raise between €3 billion and €5 billion, $4.1 billion and $6.8 billion, in a 10-year bond sale. To top of page

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