CBO Projects $442 Billion US Federal Deficit

[Agamemnon]

It's not sustainable. I'm sure several factors will be pointedly blamed by the Administration. The economy was supposedly tanking when Bush took office. The war in Iraq might easily account for half of that, both in payments to contractors, the military, as well as direct assistance to Iraq. I believe next year's deficit is predicted to be more or less similar to this year's.

I think the scariest thing is not that the deficit is $422 billion, but rather that it constitutes like 5% of total US debt (3-5 trillion?). That's a lot of borrowing to do in one year.

[Cowperson]

Originally posted by fotze@Sep 7 2004, 05:06 PM
The Congressional Budget Office projected Tuesday that this election-year's federal deficit will hit a record $422 billion, a shortfall that would be smaller than analysts predicted earlier this year.

http://apnews.myway.com/article/20040907/D84UU1U00.html

Is it me or is that mind bogglingly high? I don't know the relative size of the US economy to ours but I know if Canada were to run a 5 Billion dollar deficit it would be a huge deal. Does US debt not matter as much as other countries or something sice it is probably owed within the US? This just doesn't make sense how that can be sustainable.

Its the largest budget deficit in USA history.

There's a group out there that says giovernment deficits don't matter. It seems to me when the government is borrowing $1 of every five it spends, that it has to matter at some point.

The Bush camp is also saying this deficit number is evidence his economic policies are working since its actually about $50 billion lower than expected, suggesting tax cuts, fiscal stimulus, etc. is finally digging in, the economy eventually picking up steam sufficiently that the deficit will disappear.

We'll see.

Cowperson

[Bring_Back_Shantz]

Originally posted by Agamemnon@Sep 7 2004, 11:17 AM
It's not sustainable. I'm sure several factors will be pointedly blamed by the Administration. The economy was supposedly tanking when Bush took office. The war in Iraq might easily account for half of that, both in payments to contractors, the military, as well as direct assistance to Iraq. I believe next year's deficit is predicted to be more or less similar to this year's.

I think the scariest thing is not that the deficit is $422 billion, but rather that it constitutes like 5% of total US debt (3-5 trillion?). That's a lot of borrowing to do in one year.

Ahhh, it's actually like 10%. Which is a whole lot scarier.

[Agamemnon]

Originally posted by Bring_Back_Shantz+Sep 7 2004, 05:56 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Bring_Back_Shantz @ Sep 7 2004, 05:56 PM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Agamemnon@Sep 7 2004, 11:17 AM
It's not sustainable. I'm sure several factors will be pointedly blamed by the Administration. The economy was supposedly tanking when Bush took office. The war in Iraq might easily account for half of that, both in payments to contractors, the military, as well as direct assistance to Iraq. I believe next year's deficit is predicted to be more or less similar to this year's.

I think the scariest thing is not that the deficit is $422 billion, but rather that it constitutes like 5% of total US debt (3-5 trillion?). That's a lot of borrowing to do in one year.

Ahhh, it's actually like 10%. Which is a whole lot scarier. [/b][/quote]
Agreed. Bush is making Reagan look like a tightwad