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Budget Deficit Expected to Hit Record $445 Billion
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| LiquidX |
Better projections compared to the 500+ Defecit projected.. does that make you proud to have a 400+ Defecit?!?! way to go...
| quote: | Updated: 06:14 AM EDT
Budget Deficit Expected to Hit Record $445 Billion
Projection Represents an Improvement Over Earlier Forecast
By ALAN FRAM, AP
WASHINGTON (July 31) -- This year's federal deficit will soar to a record $445 billion, the White House projected Friday in a report provoking immediate election-season tussling over how well President Bush has handled the economy
The administration's annual summertime budget update forecast shortfalls falling to $331 billion next year, then fading to $229 billion by 2009. For each year, the red ink was smaller than the White House envisioned six months ago.
The analysis was released the same day the Commerce Department said economic growth slowed this spring to an annual rate of 3 percent, well below the 3.8 percent spurt that many economists expected. The slowdown was caused by a spending cutback by consumers in the face of high gasoline costs, the department said.
Administration officials hailed the budget figures as a solid improvement over the deficits analysts forecast early this year, and said they were on their way to their goal of halving this year's shortfall in five years. The White House estimated a $521 billion budget gap for 2004 in February, while the nonpartisan Congressional Budget Office predicted a $477 billion deficit.
''This improved budget outlook is the direct result of the strong economic growth the president's tax relief has fueled,'' said White House budget director Joshua Bolten.
He conceded that the red ink remained at ''unwelcome'' levels, but said the report was still ''good news'' because of the reduction from earlier estimates.
Democrats contrasted the $445 billion projection with the $262 billion surplus for this year that Bush projected in 2001, when he was persuading Congress to approve the first of his tax cuts.
The shortfall will be the third consecutive - and ever-growing - deficit under Bush, following four consecutive annual surpluses under President Clinton. Democrats said the turnabout underscored the damage done by Bush's tax cuts and his poor stewardship of the economy, and criticized the White House praise for the report.
''What we've got now is a president of the United States who is actively misleading the American people on the financial condition of the country,'' said Sen. Kent Conrad of North Dakota, top Democrat on the Senate Budget Committee. ''Shame on him.''
The White House attributed this year's improvement to the collection of $82 billion more in revenue than anticipated, reflecting stronger economic activity. That was partly offset by $6 billion more in spending than expected, largely for Medicaid and Medicare.
The projection, if accurate, would mean the government will have to borrow 19 percent of the $2.32 trillion it expects to spend this year.
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Last year's $375 billion deficit was the largest ever. When adjusted for the loss of purchasing power caused by inflation, only the shortfalls during World War II have exceeded the projected $445 billion shortfall.
The Concord Coalition and the Committee for a Responsible Federal Budget, bipartisan groups that advocate balanced budgets, said the report showed deficits must be controlled.
''We cannot continue to allow this burden to multiply for our children and our children's children,'' said Maya MacGuineas, the committee's executive director.
The White House said this year's actual deficit could well be smaller because federal agencies often overestimate expected spending. The government's budget year runs through Sept. 30, so the final figures will be in shortly before the Nov. 2 elections.
Administration officials say a $445 billion deficit would be manageable because it would be 3.8 percent the size of the economy - well under the 6 percent ratio during the worst of the red ink under President Reagan.
''I am pleased with the direction we are moving in,'' said House Budget Committee Chairman Jim Nussle, R-Iowa. Continuing a Republican theme, he and others said the numbers showed spending must be constrained.
Democrats said by only extending five years, the projections ignored the longer-term budget crisis looming as the baby boom generation starts retiring later this decade.
The report included the $25 billion Congress recently approved for U.S. action in Iraq and Afghanistan. But Democrats noted it ignored the next request for those wars the White House will make early next year, and the costs of easing the alternative minimum tax's effect on middle-income families.
''There's no shock, there's no shame and there's no solution'' from the White House, said Rep. John Spratt of South Carolina, lead House Budget Committee Democrat.
The report also boosted the estimate of Medicare spending by $67 billion over the next five years. It said $26 billion was to correct costs left out of Bush's budget last February, with the rest reflecting new estimates for the program's spending.
Medicare, the government's health insurance program for the elderly and disabled, spends about $300 billion a year. It already faces questions about its solvency because of the burden the baby boomers will place on it, and growing medical costs.
The report was released a day after the Democratic National Convention and the same day Congress began hearings on the Sept. 11 commission's final report. The deficit projection was due July 15, a date often ignored by administrations of both parties.
Bolten said the report was not ready earlier, but Democrats said the timing was aimed at hiding it.
AP-NY-07-31-04 0603EDT
Copyright 2004 The Associated Press. The information contained in the AP news report may not be published, broadcast, rewritten or otherwise distributed without the prior written authority of The Associated Press. All active hyperlinks have been inserted by AOL. |
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| Cyrus King |
But Bush is such a good president... hes cut taxes! HAHAAHAHAHAH
Its getting ridiculous.. i still laugh at the pathetic attempts that pro bush advocates here utilize to back thier arguments.
Give it kids... Bush has royally fuked up your nations reputation and respect |
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| Q5echo |
| quote: | Originally posted by Cyrus King
But Bush is such a good president... hes cut taxes! HAHAAHAHAHAH
Its getting ridiculous.. i still laugh at the pathetic attempts that pro bush advocates here utilize to back thier arguments.
Give it kids... Bush has royally fuked up your nations reputation and respect |
we're just fine. your doom-sayer mentality is very tired. |
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| Cyrus King |
| quote: | Originally posted by Q5echo
we're just fine. your doom-sayer mentality is very tired. |
Your idiocy is tiring |
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| Yoepus |
without reading the article.
Why are they record deficits?
And are these 'records' considerate of inflation and the value of the dollar vs. previous 'records'?
I'm very skeptical. |
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| BadBadNeil |
Number of reasons including high cost of medicare, war in Iraq, war on terror, the tax cuts, recession, and various trade deficits. I think the Iraq war has already cost around $125 billion and medicare in 10 years would cost $540 billion by estimates. Thats not including social security which will be increasing exponentially in a decade or so.
Social Security and Medicare can't really be affected unless somehow the system is overhauled. It's just a fact that people are getting older and the largest segment of our population is ready to retire.
I think the tax cuts were a mistake and I don't know how much they really affected the economy. A lot of people I know just saved them instead of spending them as was the whole idea to stimulate the economy.
I think recession was already in place before Bush so I can't blame him on that. The big tech bubble, emerging China and low energy reserved and various other things were in effect already. 9/11 just tipped the scale which was already on the point of teetering. |
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| speedracer_mec |
| quote: | Originally posted by Cyrus King
Your idiocy is tiring |
Every post i see you write is insulting.
Opinions differ from idiocy
if someone feels different.
If you are going to act like a child, pls go post in the chillout forum.
some other words you have chosen to use against people
in other threads.
Grow up kid, this is political discussion. |
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| Cyrus King |
| quote: | Originally posted by speedracer_mec
Every post i see you write is insulting.
Opinions differ from idiocy
if someone feels different.
If you are going to act like a child, pls go post in the chillout forum.
some other words you have chosen to use against people
in other threads.
Grow up kid, this is political discussion. |
SHUT THE UP YOUR ING PEICE OF MORONIC !!!! AHAHH
I love talking like this... and i dont care what the hell anyone thinks about me on this board... i just like to state my opinion. |
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| DaveSZ |
| quote: | Originally posted by Yoepus
without reading the article.
Why are they record deficits?
And are these 'records' considerate of inflation and the value of the dollar vs. previous 'records'?
I'm very skeptical. |
They are record deficits in terms of dollar amounts I believe.
I'm not sure how they would compare when inflation is taken into consideration, but I assume they are comparable to poppy's deficits.
Edit:
Inflation adjusted:
The US debt:
$7,308,426,855,798.06
Your share:
$24,915.78 |
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| Yoepus |
| quote: | Originally posted by DaveSZ
The US debt:
$7,308,426,855,798.06
Your share:
$24,915.78 |
Hmm thats what I was looking for. So it indeed does seem to be record debt (if we are to believe the figures above as accurate). The only counter-argument to this would be the assesment of debt to GDP. Which at this level does not seem as 'scary'.
However, a 7 trillion dollar debt? I don't believe this figure. Can you document it for me?
I know the USA has a lot of debt, but this figure must be a projection taking into consideration future debt, and not the current amount of debt the government owes. If not, this is indeed a very issue to be worried about. The size of the entire US economy is only 10 trillion dollars, and the federal budget around a third of that. |
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| Dupz |
holy sh*t that's a lot of money.
We have to remember though, budget deficits arent as bad as everyone would assume. The aim by (most) goverments, when running a deficit, is to hopefully stimulate the economy out of a recession.
We all *should* know that war stimulates the economy... by creating jobs for defence contractors etc etc. But if this was Bush's whole idea for starting such a large scale war then he might as well have put all these multi-billions in something a little more productive.
Just a few suggestions:
- Healthcare
- Education
Cliche, I know, but God knows the US needs it... and with that much money (which almost amounts to Australias entire GDP for a single year) I'm sure that the US health and educational systems could be running at standards far beyond any of those in any other country.
PLUS, such spending can be seen as a real investment for the future, rather than just spending stupid amounts of money on uranium tipped weapons.
Get your heads together America. |
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