Painting a Rosy Budget Picture
Bush Touts Declining Deficit, but Long-Term Outlook Is Dimmer
By Michael Abramowitz and Peter Baker
Washington Post
MACON, Ga., Oct. 10 -- The federal budget deficit shrank from $318 billion to less than $260 billion in the fiscal year that concluded in September, officials disclosed yesterday. It marks the second year in a row that the deficit has declined after ballooning in the early years of the Bush administration.
White House officials hailed the improving short-term budget picture as a vindication of President Bush's tax-cutting agenda, though the long-term prospects are considerably bleaker, given the escalating costs of health-care and retirement programs and, in the view of many economists, the red ink produced by tax cuts.
Bush pointed to the declining budget deficit in remarks Tuesday evening at a fundraiser in Georgia, where he once again sought to frame next month's midterm elections in part as a referendum on tax cuts that he says have stimulated revenue. The nation "has got this choice to make," Bush told donors here. "Do we keep taxes low so we can keep this economy growing, or do we let the Democrats in Washington raise taxes and hurt the economic vitality of this country?"
The president will step up his efforts to tout the economy at a White House event Wednesday, when officials said he will announce that he has met his target of cutting the deficit in half over five years -- three years ahead of schedule.
That promise was based on what officials once projected would be a $521 billion deficit in 2004. One senior White House official, who spoke on the condition of anonymity because the president has not officially announced the numbers, said the deficit for 2006 will be less than $260 billion, "with a significant margin." The Congressional Budget Office estimated last week the deficit would be $250 billion.
One reason the goal was achieved is that the bar was set low. As the economy improved, the $521 billion deficit never materialized, and the government ended 2004 with a $412 billion deficit. Moreover, Bush's policies, including the tax cuts and war spending, helped wipe out the surplus that his administration inherited from the Clinton administration in 2001; Democrats point out that the government was supposed to be running a $300 billion surplus this past year, so in effect, they say, there has been a downward swing of more than half a trillion dollars.
(The rest is here.)
By Michael Abramowitz and Peter Baker
Washington Post
MACON, Ga., Oct. 10 -- The federal budget deficit shrank from $318 billion to less than $260 billion in the fiscal year that concluded in September, officials disclosed yesterday. It marks the second year in a row that the deficit has declined after ballooning in the early years of the Bush administration.
White House officials hailed the improving short-term budget picture as a vindication of President Bush's tax-cutting agenda, though the long-term prospects are considerably bleaker, given the escalating costs of health-care and retirement programs and, in the view of many economists, the red ink produced by tax cuts.
Bush pointed to the declining budget deficit in remarks Tuesday evening at a fundraiser in Georgia, where he once again sought to frame next month's midterm elections in part as a referendum on tax cuts that he says have stimulated revenue. The nation "has got this choice to make," Bush told donors here. "Do we keep taxes low so we can keep this economy growing, or do we let the Democrats in Washington raise taxes and hurt the economic vitality of this country?"
The president will step up his efforts to tout the economy at a White House event Wednesday, when officials said he will announce that he has met his target of cutting the deficit in half over five years -- three years ahead of schedule.
That promise was based on what officials once projected would be a $521 billion deficit in 2004. One senior White House official, who spoke on the condition of anonymity because the president has not officially announced the numbers, said the deficit for 2006 will be less than $260 billion, "with a significant margin." The Congressional Budget Office estimated last week the deficit would be $250 billion.
One reason the goal was achieved is that the bar was set low. As the economy improved, the $521 billion deficit never materialized, and the government ended 2004 with a $412 billion deficit. Moreover, Bush's policies, including the tax cuts and war spending, helped wipe out the surplus that his administration inherited from the Clinton administration in 2001; Democrats point out that the government was supposed to be running a $300 billion surplus this past year, so in effect, they say, there has been a downward swing of more than half a trillion dollars.
(The rest is here.)
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