Posted on 07/07/2005 3:41:41 PM PDT by Skylab
U.S. Budget Deficit Tumbles, Congressional Analysts Say
By Andrew Taylor Associated Press Writer Published: Jul 7, 2005
WASHINGTON (AP) - Higher-than-expected tax receipts and the steadily growing economy have combined to produce an improved picture for the federal budget deficit, congressional analysts say.
The deficit for the current budget year, which runs through Sept. 30, should be "significantly less than $350 billion, perhaps below $325 billion," according to the Congressional Budget Office. The agency produces nonpartisan estimates for Congress and will put out a full update Aug. 15.
Thursday's new figures come as the White House is to release its midyear budget review July 13. Administration figures are also expected to show significant improvement from the $427 billion current-year deficit it predicted in January.
The biggest factors for the improving deficit picture are higher tax receipts from corporations and individuals. The economy is performing slightly above earlier administration expectations. Despite the improvement projected over the short term, neither the CBO nor the administration's Office of Management and Budget is expected to dramatically overhaul its long-term deficit projections, which show a steady decline in the level of red ink through the end of the decade but anticipate a spike in the deficit soon thereafter as the baby boom generation claims its retirement benefits.
"This is good, but let's try to figure out if there's anything permanent here," said CBO Director Douglas Holtz-Eakin.
Still, the new numbers will make it easier for the White House to credibly claim it will meet its goal of cutting the deficit in half - from the $521 billion it originally predicted for fiscal 2004 - by the time President Bush leaves office. Budget watchdog groups like the bipartisan Concord Coalition say White House budget projections are suspect since they leave out long-term costs for the war in Iraq and other factors.
"The numbers are coming out better," said White House budget director Joshua B. Bolten in an interview last month. "We had projected a very steady path of decline of the deficit, especially as a percentage of GDP, which is the right way to judge it. Right now, we're doing better than hitting that target. They'll be better because we've gotten better revenues than we originally projected."
As it addresses the deficit, the White House has focused chiefly on clamping down on domestic programs whose budgets are appropriated every year by Congress. That's only about one-sixth of the overall budget, however. Congress is also planning a five-year, $35 billion cut from automatically budgeted programs such as Medicaid and farm subsidies.
"The long-term budget issues are the mandatory programs - Social Security, Medicare, Medicaid. Everything else is dwarfed by that," Holtz-Eakin said. He added that the current improvement in the deficit picture "looks like a pittance" when compared with the long-term liabilities.
AP-ES-07-07-05 1754EDT
This cannot be repeated enough because most people don't grasp it the first twenty times.
The $$ dazzle them and the RATspeak you hear on the MSM. You are 100% correct in your post.
Exactly.
Hmmm, tax cuts equal higher revenues? Shocked, shocked i tell you!
Hmmm, tax cuts equal higher revenues? Shocked, shocked i tell you!
Well, well, well. Gotta be Bush's fault.
Good post. Bad news for the MSM and the Dems, who will ignore it. But they don't call the shots any more . . .
You got it. The see Petey Jennings do that little incredulous rolling of the eyes as he said 'The US budget deficit reached a new high today...with no end in sight" or whatever, and they think "A new high for the budget deficit."
The same MSM folks who report this as if it's some sign of the apocalypse are right on the spot, though, to criticize any budget "shortfalls"--"While the President said today his was the largest budget for ((whatever)), in adjusted dollars it falls far short of the level of funding in the 1970's..." or whatever.
It's not paranoid Republican ranting--it's true. They use whichever standard--adjusted $, proportion of the GNP, whatever--gives them the best spin.
If this were news under the Clinton Presidency, the cover of Time would read "The New Boom!"
yep. There was nothing unexpected about receipts going up. It happens every time rates are cut. The rate cuts are just not dynamically scored. That is all.
If Clinton were in there we would hear: the budget deficit will be eliminated in 6 years, no 8, no 12, no 7, no 9, no 10, no 8, etc.
And then he took credit for the deficit's erasure!
There was a time when they were wondering what to do with the annoying surpluses.
Surely you can find something to whine about here.
That phony "statistic" is meaningless, and shouldn't be referenced at all.
It's "junk economics" ~ an apple-to-oranges comparison that has no intelligent significance.
LOL! And if the ChiComs want their money back from the bonds they've been buying... stiff 'em!
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