Administration official projects record deficit

[fletchisrhsm]

ope: The Bush Boom continues Biatches!!!!



Bush administration official: 2008 will set record


ANDREW TAYLOR
The Associated Press


WASHINGTON - A Bush administration official said Monday the next administration will inherit a record federal budget deficit for next year that approaches $490 billion. The official said the deficit was being driven to record levels by the sagging economy and the stimulus payments being made to 130 million households in an effort to keep the country from falling into a deep recession. A deficit approaching $490 billion would easily surpass the record deficit of $413 billion set in 2004.


The administration official spoke on condition of anonymity because the new estimate had not been formally released. Administration officials were scheduled to do that at a news conference later Monday.The White House had predicted next year's deficit at $407 billion. Figures for the 2008 budget year ending Sept. 30 may also set a record.


February's White House estimate predicted the next administration would inherit a $407 billion deficit. That's expected to rise too, given the continuing weak performance of the economy.The numbers represent about 3 percent of the size of the economy, which is the deficit measure seen as most relevant by economists. That's considerably smaller than the deficits of the 1980s and early 1990s, when Congress and earlier administrations cobbled together politically painful deficit-reduction packages.


Still, the new figures are so eye-popping in dollar terms that it may restrain the appetite of the next president to add to it with expensive spending programs or new tax cuts.The deficit for 2007 totaled $161.5 billion, which represented the lowest amount of red ink since an imbalance of $159 billion in 2002. The 2002 performance marked the first budget deficit after four consecutive years of budget surpluses.


That stretch of budget surpluses represented a period when the country's finances had been bolstered by a 10-year period of uninterrupted economic growth, the longest period of expansion in U.S. history.However, the country fell into a recession in March 2001 and government spending to fight the war on terrorism contributed to pushing the deficit to a record in dollar terms in 2004.The figures to be released later will paint a picture of the financial health of the government that President Bush's successor will inherit, as well as updated predictions of the health of the economy.
White House budget director Jim Nussle and Edward Lazear, chairman of the president's Council of Economic Advisors, were scheduled to release the administration's updated forecasts at an early afternoon news conference


All hail to "compassionate conservatism". With two liberals running for POTUS it can only get worse.

 

[Willie99]

Fletch, I started a thread for you

http://www.therxforum.com/showthread.php?t=601021

BTW: soaring energy costs make a strong economy very difficult, if not impossible

 

[tiznow]

energy costs LMAO

high energy costs usually means global economy is humming along sucking up alot of energy and consuming lotsa goods

petroleum industry got annilated just like everybody during the depression

anywho as for the deficit

only gonna get worse as the amount spent on bailouts gonna rise

while tax revenues will continue to fall with the crappy economy

get ready for obama to tax the hell outta the rich gotta happen at some point....you neocons got your free ride under bush "protecting our country" by waging an expensive war/nation building campaign and lowering taxes at the same time

 

[Willie99]

Tiz, when the economy was growing strong for an extended period of time, energy costs increased at a moderate rate. Yet when the economy slows, energy costs soar.

It seems to me that the strength of the economy and the cost of energy have had more of an inverse relationship. You argument sounds reasonable, but the results don't support it.

I know there are scores of variables impacting the cost of energy, but to date, the soaring costs appear to have hurt the economy. If there is a correlation, that's the only one that can be reached.

 

[tiznow]

Tiz, when the economy was growing strong for an extended period of time, energy costs increased at a moderate rate. Yet when the economy slows, energy costs soar.

It seems to me that the strength of the economy and the cost of energy have had more of an inverse relationship. You argument sounds reasonable, but the results don't support it.

I know there are scores of variables impacting the cost of energy, but to date, the soaring costs appear to have hurt the economy. If there is a correlation, that's the only one that can be reached.

your somewhat looking in the rearview mirror and sometimes it takes time for the trend to change....they all don't do it at once

like unemployment is a lagging indicator always the last chip to fall so to speak

china, brazil, india etc were all still overheating while we were starting to fall

oil consumption ain't just the US anymore

china instituted a large number of anti inflationary/growth controls as their large poor population can't deal with the inflation and both the inflation and their consumption is starting to slow granted its still growing but not at the pace it was in the recent past

plus oil was an inflation hedge for alot of these troubled financials and many other people in the latest ramp......as the fed as expected was tossing around funny money like madmen

i'm sure places like goldman sachs were heavily long and made money on oil futures with the big ramp to 147 oil

 

[fletchisrhsm]

Tiz, when the economy was growing strong for an extended period of time, energy costs increased at a moderate rate. Yet when the economy slows, energy costs soar.

So witch is it Willie... was there a Bush boom or not? Because ever since his second year in office gas prices have trended up, WAY UP. So with your line of thinking, we must have had a weak economy during these last seven years?

:nohead:

 

[Mistermj]

Run that defecit up as high as you can George...its money well spent to handcuff Bambi from having any weird ideas about social programs that we will be locked into for the next hundred years.

So in the long run...Bush is again a genius...he is saving us money!

:nohead: :drink:

 

[MichaelScott]

I think costs and prices are being confused. Costs as in the bills you accumulate from a booming economy, and are lowering as Tiz stated. Prices however, are forecasted to rise 8-9% this year. I think gas in inlcuded in this figure. This was a CNN money article last week.

Where is Dawoof when you need him?

 

[tiznow]

i think prices will stay elevated in the necessities

gas food etc....

but i don't see how oil is gonna go parabolic again until we get this credit mess worked out (gonna take a long time)

also as far as food at the store it takes a while to filter through the system

i just think overall you are looking at a deflationary environment in which prices of shit you don't need, homes, etc.....are gonna fall alot

while prices of oil, food shit you need will stay relatively flat or maybe slightly down FROM CURRENT LEVELS

woof IMO is right over the longer term 10-20 year outlook