yeah...bush's strategy to bankrupt us is GOING WELL
2004 Deficit Hits Record $214 Billion
Thu Oct 14, 4:21 PM ET
story.news.yahoo.com.
By ALAN FRAM, Associated Press Writer
WASHINGTON - The federal deficit surged to a record $413 billion in
2004, the Treasury Department announced Thursday,
injecting the figure into a presidential campaign in which the two parties
have clashed over President Bush (news - web sites)'s management of
the economy and the budget.
The number was a significant improvement from the shortfalls that
analysts projected earlier this year, including a $521 billion estimate the
Bush administration made in February. In March, the nonpartisan
Congressional Budget Office (news - web sites) estimated a deficit of
$477 billion.
Both the administration and the Congressional Budget Office had
lowered their deficit forecasts as the year progressed, due to stronger
than expected revenue collections and lower spending.
Even so, the final deficit figure easily surpassed the previous record in
dollar terms - a revised $377 billion deficit that was run up last year.
The government's 2004 budget year ran through Sept. 30.
In a statement, Treasury Secretary John Snow cited improving economic
data and said the budgetary improvement shows Bush is on track to cut
the deficit in half over five years as he has promised.
"All of this shows that the president's tax relief initiatives are having the
intended effects," Snow said.
Democrats disagreed.
"There is simply no credible way to present the largest deficit in history
as good news," said Rep. John Spratt of South
Carolina, top Democrat on the House Budget Committee. "The
Republicans control the House, the Senate and the White House, but
today's news proves again they have failed to control the budget."
The government spent $2.292 trillion last year and collected $1.88 trillion
in revenue, the Treasury Department said.
The administration and congressional Republicans have discounted the
significance of a deficit of this magnitude.
They say the more important measure is that the 2004 shortfall was an
estimated 3.6 percent the size of the economy, well below the worst-ever
6 percent figure set in 1983 under President Reagan.
Many economists agree that comparison is more significant because it
shows how affordable the deficit is for the nation. But many of them are
uncomfortable with shortfalls of that size because the deficits are
expected to worsen later this decade when the huge baby boom
generation begins drawing on Social Security (news - web sites) and
Medicare.
The Treasury released the final deficit figure the same day it announced
that the government has begun using accounting procedures to avoid
hitting the $7.4 trillion national debt limit.
Snow made that announcement in a letter to Congress. Lawmakers have
yet to pass legislation needed to boost the government's borrowing
authority, which now stands at a statutory limit of $7.4 trillion.
"Given current projections, it is imperative that the Congress take action
to increase the debt limit by mid-November," when "all of our previously
used prudent and legal actions to avoid breaching the statutory debt limit
will be exhausted," Snow wrote House and Senate leaders of both
parties.
When the government runs an annual deficit, it must borrow money to
finance its operations, driving its accumulated debt ever higher. |
