We Can Cut the Deficit in Half--A growing economy will help close the budget gap [in 5 years]

Wall St Journal ^ | December 10, 2003 | JOSHUA B. BOLTEN

[SJackson]

President Bush has resolutely pursued three top priorities: winning the war on terror, protecting the homeland and strengthening the economy. While rarely challenging these goals, some commentators now suggest that, in their pursuit, the administration has unwisely neglected deficit reduction and fiscal discipline. From the left, the president's tax cuts are blamed for driving the federal budget into deficit. From the right, the president is criticized for acquiescing in a Congressional domestic spending spree. Neither charge stands up to scrutiny.

[optimistically_conservative]

Although this is entirely true, it would be nice to see it coming from sources other than the President's OMB.

[Drango]

and restraint elsewhere

Nonsense! The "Farm Act", "No Child Left Behind", and the new "Drug Bill" are three examples of major spending programs.

NPR/PBS was funded. And the pork ! Just what were you guys thinking/doing?

I'm still voting for Bush, but you guys need to buy a vowel (with your own money, not mine) and get a clue.

[alloysteel]

The plan, nebulous though it may have been, has always been to grow ourselves out of the deficit. Smoke, with and without the help of mirrors, constitutes much of the present strategy. Another thrust in the effort to "reduce" the deficit is the huge bubble of inflationary pressure coming through the pipeline. Cheap credit is fueling a lot of speculative investment, and unsecured debt, with the expectation of repaying today's relatively valuable dollars with tomorrow's cheap dollars.

The $6 Coke from the vending machine is coming to your snack room soon.

[familyofman]

"....our projections show a solid path toward cutting the deficit in half, toward a size that is below 2% of GDP, within the next five years."

Not even the slightest hope expressed for balancing the budget, only projrctions of "cutting the deficit in half" - over the next 5 years. What a total crock & from a "conservative" no less. I'm sure the WSJ would be happy & proud if these numbers were coming from a liberal administration. Blinders on - full speed ahead.

[KantianBurke]

I noticed that to. What a friggin joke.

[safeasthebanks]

It's the WSJ EDITORIAL PAGE that is true-blue conservative. The rest of the paper is as liberal-slanted as the NY Times, Wash. Post, etc.

For what it's worth, any talk about "balanced budgets" by anyone is pointless until the massive entitlement programs are "massively" reformed.

[WOSG]

How about ELIMINATING the deficit in 5 years.

Here is how: keep spending at the same nominal levels. which means about 1-2% cuts in real terms yoy for 5 years.

Tax revenue growth will grow to fill the gap, and as the economy grows faster than govt spending, the burden of govt spending on the economy will decline.

so with small cuts in spending we can end the deficit.

the Bush projections are to have a deficit in 2008 larger than they inherited *even if* we have good growth.

[familyofman]

"How about ELIMINATING the deficit in 5 years. "

Not very likely with the current admin & congress. From FY2000 - FY'03 Receipts have declined 12% (2,025b - 1,780b) while Outlays have increased 20% (1,789b - 2,150b). To think that both tax revenue will increase and expenditures decrease is not facing reality.

[WOSG]

"To think that both tax revenue will increase and expenditures decrease is not facing reality."

Actually, it IS a safe bet to suggest that tax revenues will increase with the economy. They fell because of the economy and because of tax cuts, which will long-term spur the economy which in turn makes up for lost revenue.
The estimates of about $2200 billion in nominal tax revenue is realistic for FY2007/ 2008 time frame.

But as you note, we are already spending $2200 billion, so every dollar in increased spending between now and 2007 is a dollar in the deficit.

It's all about the spending. You say it is not realist to have real decreases in spending. Consider that *if* we have a majority of Ron Paul type Republicans, that is exactly the kind of spending bills that would get passed ... realistic? I would point to FY1995 as the one year in our history where it WAS done, and we cut the deficit OVER $100 BILLION in a single year! It's all a matter of who gets voted in and how they mark up the spending bills. It is not appropriate to dismiss such ideas as "unrealistic", when all I am saying is to keep the bloated Federal budget at $2200 billion for 5 years. Give us a real Conservative majority and such a plan is indeed doable.

[FirstPrinciple]

Well, I won't be voting for Bush. But, you are right. Profligate spending causes deficits. And Bush is a big government type, and hence not getting my vote.

[WOSG]

'big govt types' in GOP ranks - as compared with the Democrats who uniformly are angrily demanding MORE TAXES and a BIGGER drug-welfare-medicare benefit ($1 trillion instead of $400 billion over 10 years), and more boondoggles (on alt. energy).

I know, the Democrats moved left and the Republicans have moved left too to fill the gap... But the point should be raised, the Democrats are pushing for more socialism. there's no way that giving them more power will help cut government. otoh a big GOP victory in 2004 and conservative defeats of RINOs (Toomey v Specter) will help.