Economy Continuing to Surge, Points to Earlier Balanced Budget
Investors Business Daily is reporting that surging tax receipts are rapidly improving the outlook for our budget deficit:
Bush May Meet Vow To Halve The Deficit Three Years Early
Aided by surging tax receipts, President Bush may make good on his pledge to cut the deficit in half in 2006 — three years early.
Tax revenues are running $176 billion, or 12.9%, over last year, the Treasury Department said Monday. The Congressional Budget Office said receipts have risen faster over the first eight months of fiscal ‘06 than in any other such period over the past 25 years — except for last year’s 15.5% jump.
The 2006 deficit through May was $227 billion, down from $273 billion at this time last year. Spending is up $130 billion, or 7.9%.
e CBO forecast in May that the 2006 deficit could fall as low as $300 billion. Michael Englund, chief economist of Action Economics, has long expected a deficit of about $270 billion this year. Now he thinks there’s a chance the “remarkable strength in receipts” will push the deficit even lower.
With the economy topping $13 trillion this year, a $270 billion deficit would equal less than 2.1% of GDP, easily beating the president’s 2.25% goal. Bush made his vow when the White House had a dour 2004 deficit forecast of 4.5% of GDP, or $521 billion. The actual ‘04 deficit came in at $412 billion, or 3.5% of GDP, before falling to $318 billion, or 2.6% of GDP, in 2005.
Not the best week to be a hyper-partisan Democrat, where you put the health of the party ahead of the health of the country.
Tags: Economy
RBB,
Earlier, Rob suggested that Puzzle actually read the posts to which she is commenting. May I respectfully suggest you do the same for your own reference material.
The Center for Budget and Policy Priorities is an admittedly left-wing “think tank” whose very ideology severely clouds the rationality of their judgment… particularly on issues of the federal budget and tax policies. The Center’s purpose, on which I have posted before when someone else used their material as a citation, is to provide rationale for the confiscation and re-distribution of income among American citizens. Clicking on the link you provided above, the following is the very first item presented in support of the Center’s pro-tax increase position,
In other words, the CBPP acknowledges the effectiveness of the Bush tax cuts in stimulating the economy and increasing federal tax receipts, all as predicted by conservatives. But because more and more people are getting wealthier, while some others are not, the results, increased economic activity and increased tax revenues, are simply not acceptable to lefties.
Had this quote been written by Karl Marx himself the meaning could not be more clear. Or more duplicitous, to use an over-wrought lefty turn of phrase.
Speaking of the authors, according to the abbreviated CV listed at CBPP, Richard Kogan is a Senior Fellow for budgetary issues who holds a BA from Yale in political science. This sentence is particularly interesting and germane to the discussion,
Which begs the question: If the so-called Budget Enforcement Act was such an accomplishment, what happened to the “caps on discretionary appropriations” that are mentioned here. If the budget is currently so out of control as the lefties charge, why include this, or Kogan, on the CBPP website?
The co-author of the cited piece, by the way, Ms. Aviva Aron-Dine, is a research assistant barely one year out of Swathmore, with a BA in Philosophy.
Sorry, RBB, but all in all, this isn’t a particularly inspired bit of reference work here. Perhaps Ms. Aron-Dine can hunt you up something more authoritative… and believable.
Every year the administration projects a deficit figure and comes in with a lower one.
The equivalent of telling the country they are going to smack the nation’s big toe with an eight pound hammer, then later pridefully announcing
“Woohoo we only smacked you with the six pound hammer.”
Nobody has paid off the last 5 years of Bush deficits sloshing around in the bilge of the ship of state.
Bush is telling us to be happy cause we are sinking slower.
Real wages are down. People do not go to the grocery store or the gas station with the GDP credit cards.
As it did everyyear of the Clinton administration! That is unless you consider the Social Security Trust Fund to be a fraud.
What’s important is that the economy is growing faster than the yearly deficit. That is an important milestone because it would be sustainable. (Only if of course if you consider the Social Security Trust Fund to be a fraud.)
Yeah, what matters isn’t that the government is getting more money. It’s that rich people including everyone that works for a living are keeping more of their money.
That’s not fair!
And it always will, dumbass.
rbb: Actually, the next round of investment requires some debt, and 2% of GDP, or thereabouts, is about right. No debt=a stagnant economy. In a healthy economy, the debt might remain at the same numerical level, but the mistaken idea is that the debt stays constant. In a dynamic(rather than static) analysis, the debt moves around within the economy, according to where the investment goes.
The fed can do something about short term rates. The market sets long term rates. The fed is in part keeping the balance between long-term and short-term rates.
Wait a minute BW. Are you saying that wages are related to productivity.
If behavior around here is any indication of Woof’s work record then he probably spends his time sabotaging management’s efforts to move the company forward.
Like the Ultra-Lefties who seem to do anything they can to get jobs working for the government where they will never be productive.
Meanwhile many of these greedy bastages are pulling down 6 figures.
Defecit=our National Debt is still GROWING!
Anonomisly:
Well, yeah. The goal should be to reduce the fraction of total public debt to GDP over time. Currently it’s around 65% (but only $4.6 trillion or about 37% of GDP is publicly held debt, the rest is money the government owes itself, this includes SS pensions and so forth).
With a balanced budget, the % of debt publicly held goes down each year, assuming a growing economy. If over the long term, the economy quits growing…then, well, we have a lot more serious problems than public debt!
Gee, I wonder if that has ever happened before?
Oh, but you see, tax cuts are BAD!
Let’s see how the mush heads spin this as somehow being a bad thing.
rbb: Your Enron-style creative accounting is always good for a laugh.
more geat economic news!
American consumers and its business community will probably start saving more than it would otherwise -The Feds are poised to raise interest rate for what would be the 17th consecutive time!
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In other good(!) economic news,
In the last several days of trading the stock market has experienced a lower than expected precipitous decline!!
While it was fear it would loose all of its yearly gain to date, signaling a recession, it came close but in the end did not…
…
George Orwell would be proud
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WOOF, if you want a raise try working harder. If your current job isn’t paying off look for another one where they’ll value your contribution to the bottom line, if you are capable of making one. Short of doing that you can continue with the whining and hope for the policies you liberals advocate, you won’t have any more in your pocket on payday but the people who are contributing to the bottom lines where they work will have less. That’s your true goal apparently.
If all those lefties are serious about lowering the deficit they could all get off their asses and go to work. Entitlements are the cause of a big part of it. If they aren’t drawing welfare outright they could try investing and paying some taxes on the income from that. I’m more than a little sick of the parasites telling me I should pay more taxes when they pay none or very little themselves.
Yeah, that’s what I’m saying Whistler. Minimum wage laws are what prevent people like WOOF from being paid what they are worth. Liberals always know how things should be run, especially the business they work for, but they rarely have enough faith in their own worth to take the risk themselves. Blustering about how people should be paid more could be followed up by starting a business and actually proving it can be done if the mouth spewing that crap actually believed it would work. They don’t ever do it but they never admit the reason they don’t is because they lack the ability to do it.
A rise in wages.
other good(!) economic news,
Prices on daily goods are still very low; -as officially reported, the Consumer Price Index(CPI) grew a mere fraction.
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Just as a point of interest, WOOF. What would it take for you to say something–anything–positive about the current state of the economy?
Regards…
And it always will, dumbass.
TwoHotel9 on June 13, 2006 at 5:54 PM
Did I poop your party?
Too bad. I mean for the MSM. Not us.