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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (42040)	5/4/2004 12:23:18 AM
From: LindyBill	Read Replies (1) \| Respond to of 793917

Federal Deficit Likely to Narrow By $100 Billion Tax Receipts Pare Borrowing By Jonathan Weisman Washington Post Staff Writer Tuesday, May 4, 2004; Page E01 Smaller-than-expected tax refunds and rising individual tax receipts will pare back federal borrowing significantly for the first half of this year and could reduce the $521 billion deficit projected for the fiscal year by as much as $100 billion, Treasury and congressional budget officials said yesterday. The Treasury Department's borrowing estimates may prove to be more good news for President Bush on the economic front, as opponents attempt to make his fiscal stewardship a campaign issue. The $184 billion the government is now expected to borrow through June is a 27 percent improvement from Treasury's February projection of $252 billion, the department said. G. William Hoagland, a senior economic aide to Senate Majority Leader Bill Frist (R-Tenn.), said he dashed off a memo to GOP leadership predicting the 2004 deficit could be trimmed to $420 billion, a record in dollar terms but considerably lower than the White House's $521 billion projection. "This is better than what everybody expected," Hoagland said. Democratic and Republican budget aides in the House warned yesterday that it was too early to reach conclusions. Spending could still take an unexpected jump because of surging hostilities in Iraq. The improving federal borrowing picture, they said, may just be bringing the administration's $521 billion deficit forecast more into line with the $477 billion deficit predicted by the nonpartisan Congressional Budget Office, Capitol Hill's official budget scorekeeper. Individual disappointments last month could prove to be to the government's fiscal advantage. Earlier this year, Bush had boasted that this year's average income tax refund would be $300 larger than it would have been without last year's tax cut. But refunds have fallen well short of that mark. Treasury officials also cited lower-than-expected government spending and higher payroll and individual income taxes as reasons that less borrowing may be needed. All of this indicates that the improving economy is beginning to slow a three-year slide in overall tax receipts. "The 5.5 percent average [economic growth] pace in the latest three quarters was the largest since 1984," said Mark J. Warshawsky, assistant Treasury secretary for economic policy, in a statement to the department's borrowing advisory committee. "With the assistance of tax cuts, growth has become self-sustaining." An improving picture could strengthen the political hands of the president and House Republican leaders as they wrangle with the Senate over more tax cuts and a budget blueprint for the fiscal year that begins Oct. 1. For weeks, the negotiations have been stalled, with a majority of the Senate demanding new procedural hurdles for further tax cutting and the House and White House steadfastly refusing. The latest compromise would mandate that tax cuts over the next three years be offset by equal tax increases or spending cuts, unless 60 Senate votes could be mustered to set the restriction aside. However, under the compromise being floated, some tax cuts -- $92 billion worth in 2005 -- would be exempted from that restriction under Congress's annual budget resolution. So far, House tax cutters have been undaunted by federal red ink. Last week, lawmakers in both parties voted overwhelmingly to make permanent Bush's tax cuts for married couples, a bill that would cost the Treasury $105 billion over 10 years. For the next three weeks, the House has scheduled successive votes on more tax cuts totaling hundreds of billions of dollars. © 2004 The Washington Post Company

To: Sam who wrote (42040)	5/8/2004 9:34:42 PM
From: Dayuhan	Respond to of 793917

I suppose we’ll see, assuming that he wins, which I think he probably will. I suspect that further deficit-building policies may be difficult to push through without producing opposition from fiscal conservatives within the Republican party – there are a few left, I hope? Domestic fiscal policies can be reversed. A reversion toward protectionism would produce a wave of similar moves throughout the world, and that would be a course much harder to change and with far wider implications. I’m not saying that I like Bush. If I have a litmus issue, though, free trade would be it, and Kerry is flunking that test abysmally. Bush doesn’t exactly pass - the continued American farm subsidies should be a national scandal – but he’s made some of the right moves on trade. This is not necessarily a Republican/Democrat divide. Clinton, for one, had better trade policies than his Republican predecessors. Today’s democrats, though, have sold their souls to pseudo-populist demagoguery on the single most important issue of the day, pandering to the lowest level of public opinion. That’s not an impressive achievement. I don’t want to vote Republican. The neocon-driven foreign policy is one of the stupider idea sets to have its day in recent years (though neocon influence is waning and will probably continue to wane). That’s going to leave us in a deep hole when the pendulum swings back the other way. The rising influence of the fundamentalist wackos is downright frightening to anyone who respects personal liberty, as any good conservative should. Republican gerrymandering and tampering with procedural rules in the legislature should leave a bitter taste in the mouth of anyone who believes in democracy. None of these, though, would be as dangerous as a retreat into economic isolationism. I wonder if we will ever have the opportunity to decide which of two good candidates and platforms is better, rather than trying to choose the least bad of two awful ones.