White House Projects Record $455B Deficit
WASHINGTON (AP) _ The Bush administration projected Tuesday that this year’s federal deficit will surge to a record $455 billion, underscoring the toll that recession, tax cuts and the costs of fighting terrorism are taking on the government’s books.
The White House also estimated that next year’s budget shortfall will hit $475 billion, though the red ink will ease downward to $226 billion in 2008. Those figures accentuate that though the White House expects the huge shortfalls to begin to decline, they remain a long-term concern _ especially with the huge baby boom population ready to start retiring later this decade.
The numbers, to be unveiled later in the day by the White House, were described by a Republican who spoke on condition of anonymity.
Before their release, White House spokesman Scott McClellan tried to put the best face on the figures, which easily exceeded the record $290 billion deficit recorded in 1992.
``The deficit certainly remains a concern, but it’s one that is manageable and it’s one that we are addressing,″ McClellan told reporters. ``Over next few years, we will cut this deficit in half. It is a priority that we are addressing.″
McClellan provided no details about how the president would achieve such a major reduction in the budget shortfall, or precisely how long that would take. An economic recovery by itself would tend to reduce the deficit as businesses and individuals pay more taxes to the government, but that could be offset by tax cuts and higher spending.
``It’s part because of how we’re managing things, addressing the spending side of things ... but it’s also getting the economy growing,″ McClellan said. ``The economic forecasts are that the economy will be growing at a much stronger rate in the coming years.″