Upon further inspection I see you were talking about the budget deficit and not the trade dficit. Thats good, because the trade deficit is nothing to get worked up about.
As far as the budget deficits go, congress should spend less money. And there is empirical evidence that shows that tax cuts do increase tax revenues. it is not a straight-line formula, but more like a curve. A quote I had in my earlier post shows that this deficit is still nothing to worry about. 1 trillion may seem high, but as a percentage of GDP, it is not the highest we have seen.
Quote:
All Things Considered, August 15, 2005 · The federal budget deficit has declined somewhat, according to new numbers released by the Congressional Budget Office. An increase in tax revenues caused the latest 2005 budget projections to cut the estimated deficit by $88 billion.
The nonpartisan CBO said that while the news is welcome, it may not have long-reaching effect. The federal deficit for the year of 2004 was $396 billion. A $308 billion shortfall for 2005, as now estimated, would reflect the positive impact of the $88 billion.
While recent total deficit levels have set records, they are not as large a portion of the U.S. economy as previous shortfalls, in the 1980s and 1990s.
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http://www.npr.org/templates/story/...storyId=4800924