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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (14916)	11/5/2004 10:36:31 AM
From: mishedlo	Respond to of 116555

With federal deficits already running amok, it is unclear how President Bush will pay for his second-term agenda, a potentially multitrillion-dollar smorgasbord that includes overhauling Social Security (news - web sites) and revamping the tax system. Bush laid out lofty goals Thursday at his first news conference since his Election Day triumph. He said he wanted to buttress Social Security, simplify the tax system, strengthen the economy, fight terrorism, bolster education, and battle AIDS and poverty abroad. "I earned capital in the campaign, political capital, and now I intend to spend it," the president said. But all the political capital in the world won't pay for his pricey priorities. And unlike four years ago, when his first term began amid projections for $5.6 trillion in federal surpluses over the next decade, the budget's future looks bleak. Thanks to recession and the burden of higher spending and tax cuts that Bush won, the nonpartisan Congressional Budget Office now sees $2.3 trillion in accumulated deficits over the next 10 years. That excludes the costs of wars in Iraq (news - web sites) and Afghanistan, easing the alternative minimum tax's growing burden on middle-class families, and the long-term crunch retiring baby boomers will place on federal support programs like Medicare. ------------- For his second term, Bush envisions reshaping Social Security so workers can use some taxes they pay to support the system to create personal savings accounts. He has not advanced details or cost estimates, but some analysts have estimated the 10-year price tag at between $1 trillion and $2 trillion. Bush wants to make 2001 and 2003 tax cuts permanent — they will otherwise expire by this decade's end — at a roughly $1 trillion price tag. He said Thursday he wants to simplify the tax system at no net cost, but in the past such exercises have often resulted in tax cuts as part of the drive to get lawmakers' votes. It is hard to estimate the long-term costs of the Iraq and Afghanistan wars, but this year's expenses alone may approach $100 billion. Domestic security costs several tens of billions annually, while his initiatives for education and foreign aid are relatively small, just a few billion a year. story.news.yahoo.com