CBO estimates that the fiscal 2010 deficit will be $1.37 trillion.
The Congressional Budget Office Friday projected the initiatives proposed in President Obama's fiscal 2010 budget would swell the fiscal 2009 deficit to over $1.8 trillion, more than the $1.75 trillion fiscal 2009 deficit projected by the White House.
Obama last month sent Congress a $3.6 trillion fiscal 2010 budget that focused on overhauling health care; implementing a cap-and-trade bill to limit greenhouse gas emissions while raising revenue for middle-income tax cuts and renewable-energy research; and improving education.
The Obama budget estimated the fiscal 2010 deficit would be $1.17 trillion but drop to $533 billion in fiscal 2013.
CBO put the fiscal 2010 deficit at $1.37 trillion and the fiscal 2013 budget gap at $672 billion. "The cumulative deficit from 2010 to 2019 under the president's proposals would total $9.3 trillion, compared with a cumulative deficit of $4.4 trillion projected under the current-law assumptions embodied in CBO's baseline," CBO said.
As a percentage of GDP, Obama's fiscal 2009 deficit projection is 12.3 percent. The $533 billion fiscal 2010 deficit number would be 3 percent of GDP. But the CBO projects the fscal 2010 deficit at 13.1 percent of GDP, and would never get below 4 percent.
Release of the dreary CBO figures raises the question of whether Democrats can push through Obama's ambitious agenda. Obama Friday said the White House was looking at the budget, line by line, for areas to cut spending, but he added that he would not cut back on the three policy initiatives.
"What we will not cut are investments that will lead to real growth and prosperity over the long term," he told a group of state lawmakers. "That is why our budget makes a historic commitment to comprehensive healthcare reform. That is why it enhances America's competitiveness by reducing our dependence on foreign oil and building on a clean energy economy. And that is why it makes a down payment on a complete and competitive education for every child."
Democrats blamed President Bush for the deficit and remain confident that the Obama agenda can be completed. "Despite these new numbers, we will adopt a budget resolution that reflects the key priorities of the president and the nation of reducing our dependence on foreign energy, striving for excellence in education, reforming our healthcare system, and cutting the deficit by more than half over the next five years," Senate Budget Chairman Kent Conrad, D-N.D., said. "We can meet those priorities and still take the difficult steps that will be needed to dig out of the fiscal and economic mess this administration has inherited."
Office of Management and Budget Director Peter Orszag also addressed the prospect of Democrats using budget reconciliation to move healthcare provisions or other parts of the budget through Congress. He said reconciliation "is not where we want to start, but it is premature to take off the table. We will have to see what comes out of the House and Senate."
Drew Hammill, a spokesman for House Speaker Nancy Pelosi, D-Calif., said no decisions about reconciliation have been made. Republicans have argued that putting any part of the budget in a filibuster-proof reconciliation measure would damage bipartisanship. Democrats say Republicans had no qualms about using reconciliation when they were in the majority.