Tilted Forum Project Discussion Community - View Single Post - From Federal Budget Surplus, to Disaster, in Just Six Years

aceventura3 · 10-11-2006, 03:07 PM

Quote:

Originally Posted by dc_dux

So you credit, in part, the downward trend during CLinton's term to Bush I and you blame, in part, the upward trend in Bush II. to Clinton.....and you don't spin?

Let's be clear. I spin stuff regularlly, but I did not spin the graphs. The graphs speak for themselves.

I need to understand who I am dealing with on this issue. I think there is latency in federal tax and spending policy. Do you agree or not - and why?

P.S. - I am betting $100 to your favorite charity that you avoid a direct answer to the question. If by chance you do answer the question, one way or the other - I think it can lead to a more productive exchange.

Quote:

Originally Posted by Ch'i

.....................

In todays news.

Quote:

Deficit falls to lowest level in 4 years
Bush hails figures; Democrats say trouble ahead
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By William L. Watts, MarketWatch
Last Update: 2:57 PM ET Oct 11, 2006

WASHINGTON (MarketWatch) -- A surge in tax receipts outpaced growth in spending, trimming the size of the federal deficit to $247.7 billion in fiscal 2006 -- the smallest gap in four years, the Treasury Department announced Wednesday.
President Bush and congressional Republicans trumpeted the figures as a triumph for the White House's economic policies, particularly the 2001 and 2003 tax cuts.
"The budget numbers are proof that pro-growth economic policies work. By restraining spending in Washington and allowing Americans to keep more of what they earn, the economy's creating jobs and reducing the deficit, making our nation a more prosperous nation for all our citizens," Bush said at a White House news conference otherwise dominated by questions about North Korea and Iraq.
Democrats said the shortfall was nothing to brag about, and that the long-term budget picture remains gloomy.
Bush and the Republican-controlled Congress "have raised the statutory debt limit four times in five years, adding more than $3 trillion to the national debt, which today stands at $8.6 trillion," said House Minority Whip Steny Hoyer, D-Md.
The final figure marked a decline of $71 billion from the $319 billion shortfall recorded in 2005. The fiscal year ended on Sept. 30.
Bush boasted that the final figure shows the White House managed to outperform his original goal of cutting the deficit in half by fiscal 2009 from its 2004 projected peak of $521 billion, or 4.5% of GDP.
Budget watchers note that the $521 billion projection actually never materialized, with the actual fiscal 2004 shortfall totaling $412 billion.
Receipts and spending at record levels
Both receipts and spending growth outpaced the economy in 2006, with both sides of the ledger rising to record levels, according to the Treasury Department. Revenues surged 11.8% to $2.407 trillion, while outlays grew 7.4%, to $2.654 trillion. The final deficit figure was an improvement on the White House's summer estimate of a $296 billion shortfall.
Individual income-tax receipts grew by 12.6% from fiscal 2005, to $1.044 trillion. Corporate income tax receipts grew 27.2%, totaling $343.9 billion in fiscal 2006.
The figure is a more dramatic drop from the White House's initial February estimate of a $423 billion deficit, which would have been a record in dollar terms.
Meanwhile, economic data show "that this economy continues to thrive," said Senate Budget Committee Chairman Judd Gregg, R-N.H. "We have met the president's goal of cutting the deficit in half - three years earlier than planned."
Democrats say the flow of red ink remains a daunting problem.
"The fact that some are trumpeting this year's deficit number as good news shows just how far we've fallen. Our budget picture today is extremely serious by any measure," said Sen. Kent Conrad of North Dakota, the senior Democrat on the Senate Budget Committee.
"Every year, the Bush administration puts out a high deficit estimate at the beginning of the year so that it can claim an improvement at the end of the year. This year is no different. No one should be fooled by the game being played here," Conrad said.
Economists and budget watchers have cautioned that revenue growth could be tempered in the next year amid signs of a slowing economy.
That means revenue growth is likely to slow to around a 6% pace, said Brian Bethune, U.S. economist at Global Insight.
Meanwhile, spending is expected to continue outpacing the growth of the economy, driven by defense-related spending and outlays for programs such as the Medicare prescription drug benefit, he said.
"As a result, upward pressure on the deficit is in the cards for fiscal 2007. While mild upward pressure on the deficit in fiscal 2007 is not particularly egregious, the persistent underlying structural deficit could prove to be an Achilles' heel should the economy slow down more rapidly than expected," Bethune said, in a research note. End of Story
William L. Watts covers Congress and politics for MarketWatch.

http://www.marketwatch.com/News/Stor...2FA5987D2C3%7D

The OP noted when the deficit started to drop and gave credit to Clinton. Now we have a peak in '04, a drop in '05 and another drop in '06. Who gets the credit for that?