White House: Budget deficit will reach $482 billion
The Bush administration Monday projected that the budget deficit for fiscal 2009 would be $482 billion, more than the record $413 billion deficit recorded for fiscal 2004.
The figure includes the $151 billion economic stimulus package enacted in February and would total 3.3 percent of gross domestic product.
That compares with 3.6 percent in fiscal 2004. For fiscal 2008, the projected deficit is $389 billion, 2.7 percent of GDP.
The projected fiscal 2009 deficit is roughly $70 billion more than the $410 billion fiscal 2009 deficit estimated in President Bush's budget proposal released in February and about $320 billion more than the $162 billion fiscal 2007 estimated deficit.
It does not include fiscal 2009 funding for the wars in Iraq and Afghanistan that Congress approved this year, totaling $80 billion.
In a document released Monday on the midyear budget review, the White House said the exclusion of the tax rebates and other provisions in the stimulus package would lower the fiscal 2008 figure to only 1.9 percent of GDP.
In addition, the paper said, the deficit is "expected to fall sharply after fiscal 2009," with the deficits in following two fiscal years only "slightly higher than projected in February." The paper concluded: "These projected deficits are both manageable and temporary if spending is kept in check, the tax burden remains low, and the economy continues to grow." The White House maintains the budget will be balanced by fiscal 2012.
Senate Budget Chairman Kent Conrad, D-N.D., slammed the new numbers and blamed the increase in part on the tax cuts Bush pushed through in 2001 and 2003, which are scheduled to expire in 2010. Bush "squandered a record surplus on tax cuts for the rich and drove us deeply into deficit and debt," Conrad said in a press release. "And he has dramatically increased our indebtedness to foreign nations like China, Japan, and Saudi Arabia -- which is clearly unsustainable." Conrad added that the debt has pushed down the dollar, causing high gas prices, inflation, and worsening living standards.
"If they gave out Olympic medals for fiscal irresponsibility, President Bush would take the gold, silver, and bronze," Conrad said.