Federal Deficit Below Last Year's Record

[Yo_Mama_Been_Loggin]

I'm sure the lowered expectation * administration considers this progress.

By ANDREW TAYLOR, Associated Press Writer



WASHINGTON - The federal deficit hit $319 billion for the budget year that just ended, down significantly from last year's record red ink, although a surge in Katrina-driven spending threatens to drive the shortfall up again.

The improvement from the record $412 billion recorded in the 2004 budget year, which the Treasury Department reported on Friday, is largely due to a surge in federal revenues from an improving economy.

The figures were released three days before Congress returns from a recess and commences a struggle to cut $35 billion from federal benefit programs over the next five years to help defray hurricane recovery costs. Friday's deficit figures underscored that even if lawmakers agree to such savings, they would have a barely visible effect on the overall red ink figure.

Despite the improvement from last year's budget gap, the 2005 shortfall was still the third-highest ever recorded. The government's 2005 budget year ended on Sept. 30.

http://news.yahoo.com/s/ap/20051014/ap_on_bi_ge/federal_deficit

[AX10]

1. Add $100 billion for the money 'borrowed' from Social Security.

Also, the deficit will be $300 billion + for the next 6 years.

[Tace]

5. No Kidding -- And How About The Iraq War -- Which Is "Off-Budget"

They are completely, absolutely full of shit.

[Nickster]

2. Wha?

"The improvement from the record $412 billion recorded in the 2004 budget year, which the Treasury Department reported on Friday, is largely due to a surge in federal revenues from an improving economy"

Wasn't this due to a one time anomaly?

[seasat]

3. They need to read the CBPP's analysis.

(LINK)

Here's their main points. Check out the link for the details.

A surge in economic growth is not behind the greater-than-expected increase in 2005 revenues.
The recent revenue rebound does not make up for the large revenue shortfalls that have developed since 2000.
Many of the factors behind the increase in revenues in 2005 are temporary.
Federal revenues remain low as a share of the economy, and the long-term fiscal outlook remains grim.
Without the recent tax cuts, the deficit in 2005 would have been much smaller.
Tax breaks for investment income lose as much revenue as expected.

This is more Shrub Inc smoke and mirrors. The CBPP also has pointed out in the past that Shrub Inc's OMB uses estimates that inflate the estimated deficit for a year while the CBPP and the CBO come in with much more realistic estimates. The reason Shrub Inc inflates the numbers is so they can claim that the deficit came in below their projections.

[seasat]

14. Oops, I pasted in the wrong link.

Here's the link to the Center on Budget and Policy Priorities. The earlier one shows the increasing consumer debt numbers.

[shoelace414]

4. many reasons

1) tax increases (I believe a tax cut or two expired)
2) don't forget, Iraq and Afganistan are off budget (and Katrina)

[skipos]

7. How/Why are

Iraq and Katrina off budget?

[shoelace414]

8. it's Emergency spending not budgeted for

if you waterheater broke, it wouldn't effect your budget, just how much money you have to spend.

[skipos]

11. ahh. thanks. nt

[MarsThe Cat]

12. in fact- Katrina may have helped their numbers-

since they're intent on cutting current spending to pay for it.

[Lexingtonian]

6. A major reason is

the Bush people and Republicans in Congress running IRS oversight allowed corporations to 'repatriate' money- on the order of $1 trillion- they'd kept overseas for years at a far lower, iirc negotiated, set of tax rates than is set in law.

In short, the American taxpayer net got screwed out of a couple of hundred billion $$$ again by American corporations. Not that the average taxpayer even realizes s/he got screwed and, hey, it put a noticeable amount of money into the federal budget here and now!

And that is why multinational corporations buy themselves governments every now and then.

[progressivebydesign]

9. I try to educate people on how much corporations are ripping the US off..

but they can't quite comprehend it. The freepy types that scream about welfare, don't realize that they are being screwed royally by offshore tax schemes.

[Oeditpus Rex]

10. They'll try to tell us how 'good' this is

It isn't good; it's only... less bad.

[daleo]

13. A $300+ Billion deficit when the economy is not in recession

And when interest rates are at historical lows? Just a sign of impending disaster.

[louis-t]

15. Yeah, and * isn't actually the 'worst' prezeedent

Somewhere in history, there's got to be at least ONE that's worser than he. So sick of the rationalization.

[twaddler01]

16. key part of this article

"The figures were released three days before Congress returns from a recess and commences a struggle to cut $35 billion from federal benefit programs over the next five years to help defray hurricane recovery costs."

They are grasping at straws to get more money....

Can someone remind me how much the Iraq war has costed so far? :grr:

[snippy]

17. A deficit of only 2.6% of GDP is very low for a republican president.

The last time a republican president had a deficit this low as a percentage of GDP was in fiscal year 1974. Eisenhower was the last fiscally conservative republican president. Republicans like to talk about LBJ as a big spender, but every republican president since Johnson has been a bigger spender than LBJ was.

Government spending under Eisenhower as a percentage of GDP averaged a little over 17.4%. Government spending under Johnson as a percentage of GDP was highest in his last three years, which were fiscal years 1967, 1968, and 1969. During those years, government spending as a percentage of GDP was 19.4%, 20.6%, and 19.4% respectively. This is an average of 19.8%. Every republican administration since has averaged a higher level of spending. However, if the Nixon/Ford years are considered as two separate administrations, the Nixon administration's spending averaged only 19.5% of GDP.

A comparison of government spending and the annual federal deficits accumulated since 1960 under republican presidents and under democratic presidents shows that republicans are bigger spenders and run much larger deficits than democrats. Bush has been about average as a big spender for republican presidents. If Bush was a democrat he would be the biggest spending democrat since WWII.

The Kennedy/Johnson administrations accumulated deficits of $53.5 billion or $269.9 billion in constant 2000 dollars. Annual spending by the federal government averaged 18.8% of GDP and the annual deficit never exceeded 3% of GDP.

The Nixon/Ford administrations accumulated deficits of $265.5 billion or $798.5 billion in constant 2000 dollars. Annual spending by the federal government averaged 19.9% of GDP and the annual deficit exceeded 3% of GDP 2 times.

The Carter administration accumulated deficits of $252.7 billion or $519.4 billion in constant 2000 dollars. Annual spending by the federal government averaged 21.2% of GDP and the annual deficit never exceeded 3% of GDP.

The Reagan administration accumulated deficits of $1,412.2 billion or $2,082.3 billion in constant 2000 dollars. Annual spending by the federal government averaged 22.3% of GDP and the annual deficit exceeded 3% of GDP 7 times.

The Bush the Lesser administration accumulated deficits of $1,035.8 billion or $1,241.5 billion in constant 2000 dollars. Annual spending by the federal government averaged 21.9% of GDP and the annual deficit exceeded 3% of GDP 4 times.

The Clinton administration accumulated a surplus of $62.5 billion or $15.9 billion in constant 2000 dollars. Annual spending by the federal government averaged 19.6% of GDP and the annual deficit never exceeded 3% of GDP.

The Bush the Liar administration has in just four years has accumulated deficits of $1,263.5 billion. and projects additional accumulated deficits during his administration of $1,296.5 billion. Annual spending by the federal government has averaged 19.9% of GDP and the annual deficit has exceeded 3% of GDP 2 times and almost certainly will again in the next fiscal year. All of the estimates included in these numbers are pre-Katrina and Rita, so the actual results for the estimated numbers probably will be much worse.

Thus, of the slightly more than $4.2 trillion in accumulated deficits since 1960, more than $3.9 trillion has been accumulated under republican presidents while only about $244 billion has been accumulated under democratic presidents.

And of the 15 times since 1960 that the annual deficit has exceeded 3% of GDP, every single time it was under a republican president. In that time the annual deficit has never exceeded 3% of GDP under a democratic president.

http://www.whitehouse.gov/omb/budget/fy2006/sheets/hist01z3.xls(Note: The first year of a presidential term operates under the budget and appropriations of the last year of the preceeding presidential term, except for any supplemental appropriation bills passed during such first year. The summary above does not include any such supplemental bills.)