posted on July 30, 2004 11:38:53 AM new
Disclaimer: For 12pole and other fools, Reamond did not write this article.
The White House said on Friday the federal budget deficit will grow to $445 billion this fiscal year, a new record likely to fuel election-year wrangles about President Bush's economic policies.
The figure, released in the White House's mid-session budget review, is well above the 2003 shortfall of $374 billion, the previous record in dollar terms. But it is $76 billion less than the $521 billion forecast for this year by the White House in February.
A top official from the nonpartisan Congressional Budget Office said recently that CBO is expecting a shortfall of less than $450 billion for the fiscal year, which ends on Sept. 30.
The Bush administration also revised up its projections for the economy from February's forecasts, saying it expected real gross domestic product growth of 4.7 percent this year, slowing to 3.7 percent in 2005. The White House in February forecast 2004 growth of 4.4 percent and 3.6 percent next year.
It now expects an average unemployment rate of 5.5 percent in 2004, down from a 5.6 percent prior estimate, and it saw this rate declining to 5.3 percent next year.
The projections of faster GDP growth this year came just hours after the government said real GDP slowed to an annualized growth rate of 3.0 percent in the second quarter, from 4.5 percent in the first three months of 2004 after consumer spending growth dipped amid high energy prices.
The figures, which were released a day after the Democratic convention and as Bush began a month of intense campaigning ahead of the Republican convention, gave ammunition to both sides in the fiscal policy debate.
RED INK
Democrats seized on the record deficit number to back charges that Bush's huge tax cuts are to blame for turning the surplus he inherited into red ink.
"Anyway you slice it, a deficit exceeding $400 billion a year is bad news for the country," said Tom Kahn, Democratic staff director for the House Budget Committee.
"In just three years the administration's failed budget policies have converted record surpluses into the biggest deficits into American history."
But Republicans argue that the lowered deficit projection shows Bush has made progress toward his goal of halving the deficit in five years.
They also say the recession in 2001, the aftermath of the Sept. 11, 2001, attacks and the wars in Iraq and Afghanistan have unavoidably increased spending.
A stronger economy has lifted tax revenues in recent months and contributed to the downward revision in the budget gap. However, costs for the Iraq war have been higher than expected.
Lawmakers this month approved an extra $25 billion request for the 2005 fiscal year beginning on Oct. 1 but the Pentagon has said it may need to dip into that money before the end of the current year. Bush is expected to ask for a larger sum when the election is over.
The White House missed its July 15 deadline for releasing the report. The budget update comes as the Bush campaign works to refine a second-term economic agenda for the president to roll out in coming weeks.
Conservative Republicans are pressing Bush to make an overhaul of Social Security a key campaign theme. But some Republicans said the anticipated large cost may weigh against giving it heavy emphasis in the campaign.
posted on July 30, 2004 02:24:47 PM new
Reamond, good post on a viable topic. Your first sentence is like those TOS that assume the bidder is a thief or worst. It creates a bias in those you wish to communicate with. You are on a higher road than this indicates, IMHO.
