U.S. budget deficit estimated at $250 billion.
A new Congressional Budget Office estimate released today concluded that the “budget deficit for the current budget year will jump to about $250 billion,” which includes the cost of the Iraq war. This figure, however, does not factor in the “at least $100 billion in additional red ink from an upcoming deficit-financed economic stimulus measure.”
UPDATE: Senate Budget Commitee Chairman Kent Conrad’s (D-ND) statement:
CBO’s new projections show that the deficit will worsen in 2008. This short-term deterioration is due, at least in part, to our slowing economy. And it is important to note that CBO’s baseline projections actually understate the likely short-term deficit levels, because they exclude expected costs such as a stimulus package and additional war funding requested by President Bush. Once these costs are added in, the deficit in 2008 is likely to exceed $350 billion, and the debt is likely to increase by over $600 billion.
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63 Responses to “U.S. budget deficit estimated at $250 billion.”
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Run it up as high as you want, Chimpy. No worries - our kids and their kids will pay for it.
January 23rd, 2008 at 10:02 amPaying it off will be much easier when the hyperinflation kicks in!
January 23rd, 2008 at 10:09 am$250,000,000,000?
January 23rd, 2008 at 10:13 amWe could buy every man, woman, and child in the world a strawberry-banana smoothie with that. Think ho wmuch happier everyone would be..cause, I mean, hey, free smoothie!
http://www.tshirtinsurgency.com
Bankrupt the country, turn the business of running the government over to private companies that get no bid contracts.
January 23rd, 2008 at 10:14 amBu$h is either the worst president ever, or the most successful, depending on your political ideology.
Did we once really have a budget surplus, or did I just dream that. Things have been so bad for so long, I’m having trouble remembering those days.
I’m sure that the our ’saviours’, the ‘fiscally conservative’ Republicans, whose ‘credentials’ our ‘independent’ media will burnish so brightly, will tell us how more tax cuts for the ‘dynamic’ capitalistic forces of our upper class will get us back to where we ‘need’ to be.
/ sarc off
/sarc off
/SARC OFF
…. damn, I think the thing might be stuck permanently.
January 23rd, 2008 at 10:14 amI wonder how Hill’reh will be able to campaign on health care and other big spending programs, when there is already a deficit? What and where will she cut to create these programs? Homeland security? Defense? Schools? Welfare?
Our economy is no longer in the position to do the things that Dems campaign on, and any movement in that direction will further sink already stumbling markets.
Their golden opportunity was in 1992, but Hill’reh knew nothing of the art of compromise, nor baby-steps. She wanted a Democratic Congress to swallow a giant bitter pill all at once, and they spat it out.
The great relief I feel, is that no matter how unpopular Reps get, even if Dems are elected, their non-viable approaches to policy guarentees their failure. It only means that the proper solutions get implemented later, after Dems flounder for an election cycle or two.
January 23rd, 2008 at 10:14 amYep, this and other aspects of the economy will be the story of the day….the week, the month, maybe the year…
#2 has a valid point…lowering the prime to much too fast is dangerous too…..these repubs should not be allowed to run a lemonade stand. This recession was predictable the moment bush was appointed.
January 23rd, 2008 at 10:18 am#6, the lowering of the interest rate will simply accelerate the collapse of the dollar, because it will encourage foreign investors to further divest from US bonds and put their money elsewhere. This could turn into a run.
January 23rd, 2008 at 10:21 am#6 This recession was predictable the moment bush was appointed.
And technically, this is the second Bush recession, with a very weak recovery between them sustained only by government and private borrowing.
January 23rd, 2008 at 10:22 amHave they counted the cost of the Iraq occupation this time? It’s the part they always seem to forget…
January 23rd, 2008 at 10:29 am#8 I agree Pete and it happens every time a republican president is running things.
hoover, ike, nixon, raygun/bushI, and inevitably bushII
when I talk to the younger generation that are just awakening to the affects that politics has on thier lives and point this out they always want to know why its not talked about……especially when they start researching it and find out how true it is……
January 23rd, 2008 at 10:30 amThe one tiny bright spot is that all our debt is held in US instruments, as Krugman points out. So when the inflation kicks in, our debt will be worth less.
It’s bad enough with what’s happening, but imagine our currency sinking and our debt being held in foreign currencies - like Argentina got hit with.
January 23rd, 2008 at 10:34 amBush knew this recession was going on in June of ‘07. Add one more lie to that list, please.
Leave it to the Chimpster to wait until we’re close to a Depression.
Makes one wonder if the Neoturd’s plan all along was bankrupt America, make some quick cash and head off to Dubai or Paraguay.
January 23rd, 2008 at 10:34 amIt also doesn’t include the roughly $2 trillion+ in deficit Social Security and Medi-aid added.
January 23rd, 2008 at 10:36 amOur next president should be a CEO type who knows how to run our government like a business and balance the books….Oh wait ,that didn’t work out so well did it?
January 23rd, 2008 at 10:36 am#13, you can thank Reagan and Greenspan for that fraud. SS should have never departed from a “pay as you go” system.
January 23rd, 2008 at 10:37 amI like the bit at the end about the deficit increasing by over $600 billion. These numbers are all such a fraud in the first place. How can there be a substantive difference between an annual budget deficit and the annual increase in the national debt?
The increase in the debt is the real number, and we’ve been running at about $500 billion a year for the last several years under our wonderful “CEO President”.
January 23rd, 2008 at 10:39 amIf public utilities like electricity need regulation, price reviews and Utility Commissions, why isn’t Oil subject to the same?
40% of the cost of gasoline right now is because speculation drives the market. Who, other than Wall St., is this good for?
I’m not suggesting a Chavez like ‘Nationalizing’, but rather holding big oil to the same controls & regulations we already have in place for many other energy providers.
January 23rd, 2008 at 10:39 amComment by Zimzone — January 23, 2008 @ 10:34 am
Come to think of it, its surprising any Republican would actually want to be the next President.
Bush has so thoroughly fu(ked things up, its going to take a lot of sacrifice to fix it.
Bush’s going away gifts to the next President include:
1) Recession
2) Huge national Debt
3) A war in Iraq
4) A destruction of the world’s goodwill towards the USA
On top of that, the crazy fu(k might drop bombs on Iran right as he’s leaving the WH too.
January 23rd, 2008 at 10:41 am15 ignore the ignorance Pete. He doesn’t even consider the difference between buying things we need as opposed to a spending spree on luxury items like this war of choice and putting them on a credit card…..really responsible…..fiscally……not.
January 23rd, 2008 at 10:43 amWhich court does America file bankruptcy in?
Always thought that it was amazing that even though Bush was a complete failure of a businessman prior to public office, so much of the country trusted/still trusts what he said/says about economic issues.
January 23rd, 2008 at 10:44 am“It also doesn’t include the roughly $2 trillion+ in deficit Social Security and Medi-aid added.”
Comment by Roger_Roger
There would be no deficit in SSI spending if they just removed the income cap.
January 23rd, 2008 at 10:45 amso much of the country trusted/still trusts what he said/says about economic issues.
that’s because republicans are really very stupid, and are more interested in “winning” than in strengthening their country.
January 23rd, 2008 at 10:46 am#18 -
But…. but… he’s fightin’ ter’ists!
Presidentin’s hard work.
January 23rd, 2008 at 10:46 am#22 -
True.
The modern GOP: Party over country.
January 23rd, 2008 at 10:47 am“Presidentin’s hard work.”
Comment by bobcat_grad
He’s been using that excuse since he was a little boy, to explain why he wasn’t getting his chores done. I’ll bet his mom smiles whenever she hears him say it, knowing it’s just an excuse.
January 23rd, 2008 at 10:50 am#21, And technically, SS is still running a surplus, which is rolled over into the general funds. The problem is that because SS has been used to hide the size of budget shortfalls since the ’80s,
Basically the SS Surplus was a scheme concocted by Reagan and Greenspan to partially counter the massive tax cuts to the rich with a massive tax increase on working people. Under the pretense of “having the boomers pay for both their and their parents’ retirement”, they basically pushed off a significant fraction of their out-of-control spending to the indefinite future.
R_R likes to tout the “problem” SS causes, but SS isn’t the problem. It’s general revenues which will have to pay back to SS what it inappropriately borrowed. SS is, in itself, fine.
January 23rd, 2008 at 10:51 amThe modern GOP: Party over country.
Comment by bobcat_grad
Let’s not go there. Remember delafield? He was advocating just that, a few days ago, regarding Hillary. So it would seem there are those in both parties who think that way.
January 23rd, 2008 at 10:54 amZimzone, good point, except……Bush and the Saudis have their hand’s up each other’s dresses, have for a generation….Indeed 16 of the 9/11 bomber’s were financed by the very people bush is in bed with….All these thing’s are relative in the price of the oil we are sucking out of the ground…Big business, the rich get richer and to hell with the rest of us..Secret behind closed door deal’s by the most evil cheney will probably not serfice for year’s….Their grand plan has worked…..I don’t know how to fix it except to vote all the basterdas out…Time for a new team and it will take more than one or two voting cycles to do that, providingthe voting isn’t rigged…..Blessings
January 23rd, 2008 at 10:55 am“Basically the SS Surplus was a scheme concocted by Reagan and Greenspan to partially counter the massive tax cuts to the rich with a massive tax increase on working people. R_R likes to tout the “problem†SS causes, but SS isn’t the problem. It’s general revenues which will have to pay back to SS what it inappropriately borrowed. SS is, in itself, fine.”
Comment by PeterW
I think you left out someone who was integral to SS’s change. Daniel P. Moynihan.
January 23rd, 2008 at 10:56 amFred #6..Very true……Blessings
January 23rd, 2008 at 10:57 amThere would be no deficit in SSI spending if they just removed the income cap. -Comment by barfly
Thank you, barfly, that certainly bears repeating.
As the NYT notes this morning, not renewing the Bush tax cuts could do as much to turn the economic situation around as a ’stimulus’ will.
January 23rd, 2008 at 10:57 amBut…. but… he’s fightin’ ter’ists!
Presidentin’s hard work.
Comment by bobcat_grad — January 23, 2008 @ 10:46 am
ha ha
I was always under the impression W was funding the terrorists so that he could justify fighting them.
January 23rd, 2008 at 10:57 amThe Democrats need to do a better job of pointing out how the War in Iraq is what is causing Americans all this economic suffering. It is the cost of staying in a war without end that is costing them at home. Many people think Iraq is just some distant war that is not affecting them, but the truth is, it’s hurting us in ways we don’t even realize yet. Not only is the war a foreign policy blunder, it’s also an economic nightmare for Americans.
The scary part is how we will deal with all the mentally ill veterans we are creating. You know, the ones Bill O’Reilly pretends are not real. That’s part of the human toll this war is having on our people.
January 23rd, 2008 at 10:58 am#29, fair enough. And there were a lot in Congress who were duped by the scheme.
SS was seeing a short-term shortfall, which fueled the hysteria that led to the “surplus” scheme.
And as for lifting the cap, I am of mixed mind. It’s supposed to be wage insurance, so I don’t think it’s reasonable to lift it on investment income. Really, SS is fine and doesn’t need a revenue increase. It’s the general fund that needs it. SS could actually dial back the FICA withholding a bit.
I’m all for a 90% top marginal income tax rate (for income earned over $5mil) instead, irrespective of whether it’s wages or investment income, and a reduction in the FICA rates until SS is pay-as-you go with maybe a 5%-of-expected-payout “rainy-day” overage.
January 23rd, 2008 at 11:02 am“The scary part is how we will deal with all the mentally ill veterans we are creating. You know, the ones Bill O’Reilly pretends are not real. That’s part of the human toll this war is having on our people.”
Comment by BrianFL —
I’m sure there is an enterprising republican even now wondering how he/she can cash in on the damaged vets, and milk their military benefits.
January 23rd, 2008 at 11:02 amAs usual the capitalist, corporate media is misleading us. The budget numbers above are the total or unified budget deficits. This unified budget deficit includes “off budget” surplus, which is overwhelmingly due to a Social Security SURPLUS offsetting the “on budget deficit” i.e., the rest of the government.
The number that should be reported is the “on budget” deficit which is $414B. The “off budget” surplus, meaning the Social Security surplus for 2008 is $191B.
Also, the improvement in the “on budget” deficit predicted by the report is based on assuming, among other things that all of Dinkledorf’s tax cuts are not made permanent and expire in 2011.
January 23rd, 2008 at 11:03 amBloggers above, PLEASE note there is a Social Security surplus and has been one since 1985!
January 23rd, 2008 at 11:04 amIf we give Bush 1 dollar per second, 24 hours a day, it will only take about 8000 years to break even.
January 23rd, 2008 at 11:05 am“And as for lifting the cap, I am of mixed mind. It’s supposed to be wage insurance, so I don’t think it’s reasonable to lift it on investment income.”
It’s a payroll tax, isn’t it? I was unaware that it extended to other modes of income generation.
January 23rd, 2008 at 11:06 am#37, yes, but that surplus is spent in current general revenues, and hence represents a major future obligation to the general fund.
January 23rd, 2008 at 11:06 am#39, it is indeed, but some of the “lift the cap” suggestions have advocated it being on all income. And in any event, to dodge it, you’d see more CEO pay shifted to stock options and the like.
January 23rd, 2008 at 11:07 am“And in any event, to dodge it, you’d see more CEO pay shifted to stock options and the like.”
Comment by PeterW
Well, if a fix was installed it would have to slam the door on shifting compensation, or use an estimated formulation of some sort.
January 23rd, 2008 at 11:10 am#40. The more accurate formulation is that by law Social Security must lend any surplus to the federal government if the latter is running an on budget deficit by buying Special Issue bonds with the Social Security surplus.
When the Treasury borrows from China and Japan by selling T-bills, notes and bonds, the lenders must be repaid interest and principle. The same goes for loans from Social Security, they must be repaid with interest. This means that if there is a problem at all in this area it is with Dinkledorf’s fiscal policy that has led to history of the world record deficits and debt and NOT in any way with Social Security.
January 23rd, 2008 at 11:10 amRIP GOP.
Bush and the neocons have destroyed your party for years to come.
I hope they haven’t destroyed the country as well.
January 23rd, 2008 at 11:14 amThanks for the lesson on Social Security stewarjt.
January 23rd, 2008 at 11:16 am36…..are you taking acid….what the hell is that supposed to mean? Seriously, do you even know of is it just something that ran down your cheek like drool so you thought you would share it with us?
January 23rd, 2008 at 11:17 am#43, precisely.
So basically what I’m saying is that they can’t use the SS surplus responsibly, and so thus it needs to be taken away.
Make up the difference and then some until the budget is balanced with progressive income and corporate taxation.
January 23rd, 2008 at 11:17 amstewarjt
January 23rd, 2008 at 11:23 amI guess I’m just dumb…..this goes over my head I guess…please ignore my rant from earlier as I’m not sure I’m not the one drooling…..
Bloggers above, PLEASE note there is a Social Security surplus and has been one since 1985!
Comment by stewarjt — January 23, 2008 @ 11:04 am
Where is it?
Comment by plunger
you guys that understand these things don’t jump on me too hard but I understand it to be borrowed by the government to fund their war and other nonsense…..pretty sure someone else has a more detailed answer but for us regular joes……
January 23rd, 2008 at 11:35 amI don’t support earmarks.
However fair is fair.
Using CAGW “Pig Book” data the link below provides the data to show that earmark DOLLARS have gone done by 25-36% in recent years, compared to period that Republicans were in charge of Congress:
January 23rd, 2008 at 11:41 am
Ooops, the link should have been THIS:
http://oregonearmarks.blogspot.com/ 2007/ 12/ news-flash-for-president-earmark.html
January 23rd, 2008 at 11:42 am“but I understand it to be borrowed by the government to fund their war and other nonsense…..pretty sure someone else has a more detailed answer but for us regular joes……”
“Borrowed” is political nicety. The money goes directly into the general fund - which goes to fund all capital expenses.
January 23rd, 2008 at 11:46 amStocks extended their decline Wednesday, with investors uneasy after reports from big names like Apple Inc. and Motorola Inc. dashed any notion that the Federal Reserve’s emergency rate cut could in short order patch up the economy.
http://finance.yahoo.com/
not good news…..
January 23rd, 2008 at 11:54 am“budget deficit for the current budget year will jump to about $250 billionâ€
————————————————–
And interest paid on the national debt for fiscal year 2007 was $430 billion. U.S. population is 303,291,883. Interest works out to $1,417.70 for every man, woman, and child in this country for 2007, or $5,670.81 for a family of four (this is average — richer people will pay more, poorer people will pay less). Think of this as you’re doing your taxes this spring. When you think of how much you are paying, remember how much of it is going just to pay interest on our gigantic debt.
http://www.treasurydirect.gov/ govt/ reports/ ir/ ir_expense.htm
Anybody notice that the deficit increase is less than the interest we are paying? If not for the interest payments, we’d have a surplus. That’s right. If our debt was even down to pre-Reagan levels, and we weren’t spending money on stupid wars, we’d have a balanced budget, everybody’s taxes would be lower, our dollar would be strong, and we wouldn’t be indebted to foreign interests.
Thanks Reagan, Bush, and Bush!
January 23rd, 2008 at 11:56 amAs the NYT notes this morning, not renewing the Bush tax cuts could do as much to turn the economic situation around as a ’stimulus’ will.
Comment by Zimzone
Not renewing them wouldn’t help until 2010 when they are set to expire. Reversing them right now would help tremendously.
January 23rd, 2008 at 12:00 pmI went to taco bell yesterday and they woudn’t take anything but pesos! WTF?!?!?!
January 23rd, 2008 at 1:03 pm#49. The social insurance program known as Social Security is financed by a legally separate (from the rest of the government) FICA payroll tax, currently at 6.2% for employer and employee. When current FICA tax revenues exceed Social Security current benefits, this is a Social Security SURPLUS!
As I said above, by law this Social Security surplus must be loaned to the federal government if the latter runs an “on budget” (all other spending) deficit. Social Security loans its surplus to the government by buying special issue bonds that become the Social Security trust fund. Thus, if you want, the surplus exists in the form of these special issue government bonds held in the Social Security Trust Fund.
The Social Security surplus was created to pay benefits for retiring baby boomers, along with current revenues.
I hope this answers your question.
January 23rd, 2008 at 1:14 pmRIP GOP.
Bush and the neocons have destroyed your party for years to come.
Comment by hellinabucket — January 23, 2008 @ 11:14 am
I hope you’re right, hib, and in a rational world there wouldn’t be any question.
But there are so many true believers who are so willing to be deluded, just so they don’t have to alter their view of the world to accommodate, y’know, facts, that I fear there will always be a ready market for stupid ideas masquerading as “free market philosophy” or “healthy forests initiatives” or “pro-life positions” or “exporting democracy” that there will always be a GOP. After all, the success of Republican ideas is due to marketing, not to essence. And if America can be turned into a nation of lite beer drinkers, you know we can be sold anything.
The best we can hope for is that the are consigned to permanent minority status.
January 23rd, 2008 at 1:22 pmI don’t think Osama Bin Laden was responsible for 9/11, but I’m sure that wherever he is, he is laughing his head off and giving paryers of gratitude to Alah for having sent Bush and Chenney… they are doing a great job destroying the USA!
January 23rd, 2008 at 1:53 pmThe Republic666an mantra is, as Raygun the idiot said, deficits don’t matter.
January 23rd, 2008 at 2:10 pmralph, I’m sure the GOP will still be around. There’s still a Communist Party in this country but they are as relevent as Fred Thompson.
The GOP will redinvent itself and be back in 10 to 15 years. But first the grand purge has to take place. All the one issue, or incendiary issue believers leave the party they will, once again, concentrate on the idea of a smaller govt. and fiscal responsibility. Something that is nowhere to be found now.
January 23rd, 2008 at 2:36 pmA billion here, a billion there. After a while you are talking about real money.
It’s unbelievable that the citizens of this country are not concerned about this. Bush is bankrupting this country (I believe by design) and the sheeple are sitting idly by watching it happen.
January 23rd, 2008 at 2:55 pm