Sunday, September 26, 2004

Bushies say: It's not our fault!

Administration officials remind audiences constantly that the federal deficits are largely a result of economic shocks: the collapse of the stock market bubble, which wiped out trillions in stock market value; the recession of 2001; and the plunge in business investment that lasted until this year.

Objective reality responds: Er, yes it is (at least now)...

The Congressional Budget Office estimated this month that cyclical economic problems contributed only $47 billion of this year's anticipated deficit of $422 billion. Next year, cyclical economic problems are expected to have almost no impact on the budget, but the deficit is expected to be $348 billion.

Going forward, virtually the entire federal deficit will be a result of structural causes - tax and spending policies set down by the president and Congress.

Oh, and by the way, we're not overtaxed:

Tax revenues in 2004 are expected to make up only 16.2 percent of gross domestic product, the lowest share in more than four decades. Although the share is expected to climb to 17.6 percent over the next decade, it would still be lower than it was in the 1960's.


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