U.S. DEFICIT BALLOONS TO $455 BILLION

[ism]

The White House acknowledged that the federal budget deficit would rise to $455B this fiscal year, due primarily to the war in Iraq and Bush's tax cuts. It would rise to $475B in 2004. The White House pledged to cut the deficit in half by 2006 to $238B, but did not specify how it would do so. They forecast the economy to improve starting this summer.

Military operations in Afghanistan and Iraq currently cost approximately $4.8B a month, or $58B per year, well over initial estimates. This easily forced a revision of the White House's original forecast of the deficit in February of $304B. The White House, as late as 2001, had forecasted a 10-year budget surplus of $5.6 trillion. The current deficit and Bush's forecast now shows $2.7 trillion of debt for the first 7 years of that period, a $7.7 trillion gap. Most analysts expect massive deficits into 2013.

The new deficit beats the previous record of $290B in 1992, under Bush's father. The U.S. experienced four straight years of surpluses from 1998 to 2001.

CNN Article (via Reuters)
Yahoo! article via AP

[AliBabaIncorporated]

Solution: cut useless government ministries like the Food and Drug Administration.

[Emperor_Mike]

<!--QuoteBegin-AliBabaIncorporated+Jul 15 2003, 10:22 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (AliBabaIncorporated @ Jul 15 2003, 10:22 PM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin--> Solution: cut useless government ministries like the Food and Drug Administration. [/b][/quote]
What's with you and government ministries anyway? :P I remember you mentioning something awhile back about standards inspectors or something to that degree. Ah well.

In any case, all this talk about tax cuts and debts reminded me of an old political trick of giving the people what they want and then taking it back through other means. Very sneaky! I think Reagan initiated an action such as the one I described.

[AliBabaIncorporated]

<!--QuoteBegin-Emperor_Mike+Jul 16 2003, 01:55 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Emperor_Mike @ Jul 16 2003, 01:55 AM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin--> What's with you and government ministries anyway? :P I remember you mentioning something awhile back about standards inspectors or something to that degree. Ah well. [/b][/quote]
Considering all the damn money I give the government (income taxes, payroll taxes, sales taxes, cigarette taxes back when I still smoked, another tobacco tax for shisha, import duties on books and videos I order from overseas, passport application fees, drivers licence fees), the least they could do is stop harassing my relatives' and friends' businesses, stop banning food products I enjoy from the supermarkets, etc.

Instead they use the money I give them to fund jobs we don't need to perform services nobody wanted.

[pfc beansprout]

wow...guess my credit card debt isn't that bad after all.......... B)

[golden_buns]

Moral of the story;
go republican, go to war, and then get into debt.

[rakovlam]

Solution: cut useless government ministries like the Food and Drug Administration.

And also remove that $400 billion Medicare package that "won't" affect the deficit. Also make states like Connecticutt and California stop spending so much so the federal government doesn't have to bail them out. Washington DC spends almost $15000 per student and their schools still suck. I've learned personally that smaller classroom sizes has zero benefits. And the biggest money wasting service is public employee salary and benefits. While the rest of the country is about to be forced into useless nationalized healthcare federal employees are exempt and are allow to resume select dozens of comptet plans.

I'm not sure if the FDA is useless. I know it's slow as hell when it comes to testing drugs. But when it come to deficits, for some reason people think it's because the taxes are too low.

[rakovlam]

go republican, go to war, and then get into debt.

So, same could be said during the FDR administration and the Kennedy and Johnson administration during Vietnam. What's with the short term memory? It seems that the average historical knowledge of the media is since Bush got elected.

[Emperor_Mike]

The twin problems behind this rapidly accumulating deficit are the tax cuts and the ongoing commitments in Afghanistan and Iraq. Didn't someone mention awhile back on YW that the cost of the "rebuilding" in the aforementioned countries costs something between three to four billion dollars a week? Coupled with the Medi-Care program mentioned by Rakovlam, the Bush II Administration's legacy will be fiscally identical to Bush I's in the 90s. The news of a global economic downturn will not help to make things better as well and unfortunately, you Americans will have to shoulder the burden for the time being until the economy recovers.

[bluetrianglescott]

I kinda think that saying "if the gov't would stop spending all our money on war, they'd spend it on us" leads us to thinking things about the gov't that aren't true--namely, that they give a damn about us in the first place.

Remember the so-called Peace Dividend we were all supposed to get after the Cold War was over? Well, neither Clinton nor Bush I seemed too interested in really pursuing that. Millions are still uninsured, HIV/AIDS isn't going away, poverty has gotten worse as the gap between rich and poor expands, and prisons are being built faster than schools. I don't think it's in the system's nature to really be for the people.

[achtungbaby]

<!--QuoteBegin-AliBabaIncorporated+Jul 16 2003, 02:44 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (AliBabaIncorporated @ Jul 16 2003, 02:44 AM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin--> ...stop banning food products I enjoy from the supermarkets, etc. [/b][/quote]
Just out of curiousity, what food products that you enjoy have been banned?

[achtungbaby]

<!--QuoteBegin-rakovlam+Jul 16 2003, 09:20 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (rakovlam @ Jul 16 2003, 09:20 AM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin--> So, same could be said during the FDR administration and the Kennedy and Johnson administration during Vietnam. What's with the short term memory? It seems that the average historical knowledge of the media is since Bush got elected. [/b][/quote]
Come on, you really wanna try and compare Republican / Democratic administrations from those eras with today? Let's face it, part of budget deficits that have become a staple of Republican adminstrations during the last twenty years, from Reagan to Bush to Bush Dubyah. Is there some correlation here? Sure.

[rakovlam]

Didn't someone mention awhile back on YW that the cost of the "rebuilding" in the aforementioned countries costs something between three to four billion dollars a week?

Could of said $8-10 billion also. Doesn't mean anything. By the way, it's 3-4 billion a month.

Come on, you really wanna try and compare Republican / Democratic administrations from those eras with today? Let's face it, part of budget deficits that have become a staple of Republican adminstrations during the last twenty years, from Reagan to Bush to Bush Dubyah. Is there some correlation here? Sure.

Please, it's all the same. If I can't compare things to the past, you might as well stop evoking your Vincent Chins and Manzanars. Deficits aren't caused by Presidents you see. The folks that actually do the spending and earning are members of the House of Representatives according to the Consitution. The Democrats had majorities in Congress during the Reagan and Bush Sr. administrations. The Republicans had a majority during the Clinton administration. Now, I am a bit annoyed how spending has gone out of control especially the Republicans who like to roll in the pork. But despite record high tax revenues after the Reagan tax cuts, the Democrats (and the rest of Congress) managed to outspend it.

Take your state, California, for instance. During the internet bubble, California raised its taxes in order to capitalize on silicon valley. What does California spend that money on? Illegal immigrants, bureaucrats, teacher's unions, and later on electricity. Then the bubble burst. Now California has higher defiit than all states combined. The national unemployment rate wouldn't be so bad if it wasn't for California. Electricity all the sudden becomes a luxury. And the Dodgers can't spend right either. Can't blame war or tax cuts on California's problems. Neighboring states Colorado and Nevada doesn't have deficits. Meanwhile in Connecticut the state grew 12% in population last decade but the bureacracy managed to grow twice as large. My state New Jersey managed to double traffic fines again and managed to raise licencing fees again and they spend it on hiring Jew-hating Amiri Baraka as poet laureate (actually the arts in NJ are funded by the hotel tax but why is there a hotel tax in the first place). Therefore, all our problems is the cause of overspending from all parties. $400 billion Medicare package and some say that's still not enough. Okay....

[pfc beansprout]

<!--QuoteBegin-rakovlam+Jul 16 2003, 02:24 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (rakovlam @ Jul 16 2003, 02:24 PM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin-->
Could of said $8-10 billion also.&nbsp; Doesn't mean anything.&nbsp; By the way, it's 3-4 billion a month.



[/b][/quote]
oh..that's it? wow, that ain't too bad...we should invade more countries and do the same (in progress)......

[Emperor_Mike]

<!--QuoteBegin-rakovlam+Jul 16 2003, 11:24 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (rakovlam @ Jul 16 2003, 11:24 AM)</td></tr><tr><td id='QUOTE'><!--QuoteEBegin--> Could of said $8-10 billion also. Doesn't mean anything. By the way, it's 3-4 billion a month. [/b][/quote]
Even at a projection of three to four billion a month those sort of numbers, combined with various government initiatives on the home front will put a big dent in the US deficit numbers as the article suggests. It's not so much a question of what sort of figures are being put forth, it's a matter of how those calculations will work in the long term. At thirty-six to forty-eight billion dollars a year (assuming the commitments in Iraq and Afghanistan take that long and all signs point to even longer timelines) the US Government is dealing with a very big problem that, in better economic times, would've been manageable. However, given that the US and parts of the global economy are spiraling into a slump (according to analysts) a deficit that's almost at the half trillion dollar mark will be difficult to mediate indeed. Of course, I'm no economist and if someone who is qualified to make a definitive statement wishes to correct me, please do.

In short, while Iraq and Afghanistan may or may not turn into a military quagmire, the situations are certainly displaying the traits of a financial one. The impact of the post-conflict spending and development may have been lessened if the Bush tax cuts are done away with. If George wanted to fight a war with "minimal" fiscal difficulties, he ought to have used the small window of opportunity offered to him by the 9-11 crisis to eliminate plans for the tax cuts and instead funnelled the resources he had into the conflict(s). All in all, in my opinion the President did a rather bad job of setting priorities. It is more than clear that he wanted to have his cake and eat it to (i.e. satisfy his voters *and* prosecute a war in Afghanistan and Iraq.) Sadly, something has to go and now the US will have to pay for it in the years to come.