Parkbandit
05-11-2009, 10:35 AM
WASHINGTON (Reuters) - The White House on Monday pushed up its forecast for the U.S. budget deficit for this year by $89 billion, reflecting the recession, a raft of new unemployment claims and corporate bailouts.
A fresh estimate of the deficit showed it coming in at $1.84 trillion -- representing a massive 12.9 percent of gross domestic product -- in the current 2009 fiscal year that ends on September 30. A prior White House forecast released in February projected a deficit of $1.75 trillion, or 12.3 percent of GDP.
The report may add to the political challenges facing President Barack Obama as he seeks to push through a new healthcare plan and other big domestic initiatives.
A White House official said the gloomier deficit picture reflected weaker tax receipts as the economy declined and higher costs for social safety-net programs such as unemployment insurance. Spending on the government rescues for the financial and automobile industries was also a factor in the higher deficit, said the official, who spoke to reporters on condition of anonymity.
While the Democratic-led Congress has given its approval to the broad outline of Obama's proposed budget for the 2010 fiscal year that includes initiatives on healthcare, education and other items, some moderate Democrats and a number of Republicans have expressed wariness about the deficit outlook.
Republicans contend that Obama's agenda would sharply increase the size of government and add to a mountain of debt but Democrat Obama counters that the enormous deficits are a legacy of President George W. Bush, a Republican.
The higher deficits "are driven in large part by the economic crisis inherited by this administration," White House budget director Peter Orszag wrote in his blog on Monday.
The report from the White House Office of Management and Budget also revised the deficit higher for the 2010 fiscal year, forecasting it at $1.26 trillion, or 8.5 percent of GDP, and up $87 billion from the $1.17 trillion projection given in February.
After taking office in January, Obama released a bare-bones version of his budget in February that offered a spending plan for 2010 carrying a price tag of $3.55 trillion. The White House revised up the size of the spending plan to $3.59 trillion.
The U.S. economy shrank at a surprisingly steep 6.1 percent rate in the first three months of this year.
CLOSING THE GAP
The new White House figures bring the deficit estimates closer in line with the non-partisan Congressional Budget Office, which has forecast a $1.85 trillion deficit this year and $1.38 trillion in fiscal 2010.
To allay worries about the deficit and fend off Republican attempts to paint him as a big spender, Obama over the past week has rolled out a series of announcements aimed at showing he is working to stem the red ink.
Last week, Obama said he could wring $17 billion in savings from his budget by cutting waste in areas from weapons systems and education to the cleanup of abandoned mines.
But the cuts in 121 programs amounted to less than one-half of 1 percent of the total budget for 2010 and even the slim list of reductions is likely to face resistance in Congress.
Obama also unveiled new details of his plan to toughen tax policies for multinational companies that invest abroad and to close loopholes on overseas tax shelters. Many businesses strongly oppose the proposed changes for multinational firms.
Later on Monday, Obama will preside over a White House forum aimed at highlighting budget savings that could be reaped by making the healthcare system more efficient.
Trade groups such as the American Medical Association and the American Hospital Association as well as labor unions are expected to present Obama with a letter pledging to reduce the growth of health spending by 1.5 percentage points annually.
The cost savings would be achieved through steps such as streamlining paperwork and changing the way hospitals deliver and bill for services to patients.
But the healthcare event appears likely to gloss over the political battle looming over Obama's push to establish a new public health insurance plan to help cover the estimated 46 million uninsured Americans.
http://finance.yahoo.com/news/White-House-forecasts-higher-rb-15199206.html?.v=3
So.. the White House had to up the estimated deficit this year by 89 BILLION dollars.. but to compensate for it, he's claiming saving 17 BILLION?
I watched a documentary about Joseph Stalin this weekend.. and before you freak out and post "OMG HE R COMPARING OBAMA 2 STALIN!!".. I'm not. I did walk away from the show thinking that no matter what Obama does, people still blindly love this guy and will excuse pretty much anything he does... much like Stalin was beloved in Russia up until he died.
A fresh estimate of the deficit showed it coming in at $1.84 trillion -- representing a massive 12.9 percent of gross domestic product -- in the current 2009 fiscal year that ends on September 30. A prior White House forecast released in February projected a deficit of $1.75 trillion, or 12.3 percent of GDP.
The report may add to the political challenges facing President Barack Obama as he seeks to push through a new healthcare plan and other big domestic initiatives.
A White House official said the gloomier deficit picture reflected weaker tax receipts as the economy declined and higher costs for social safety-net programs such as unemployment insurance. Spending on the government rescues for the financial and automobile industries was also a factor in the higher deficit, said the official, who spoke to reporters on condition of anonymity.
While the Democratic-led Congress has given its approval to the broad outline of Obama's proposed budget for the 2010 fiscal year that includes initiatives on healthcare, education and other items, some moderate Democrats and a number of Republicans have expressed wariness about the deficit outlook.
Republicans contend that Obama's agenda would sharply increase the size of government and add to a mountain of debt but Democrat Obama counters that the enormous deficits are a legacy of President George W. Bush, a Republican.
The higher deficits "are driven in large part by the economic crisis inherited by this administration," White House budget director Peter Orszag wrote in his blog on Monday.
The report from the White House Office of Management and Budget also revised the deficit higher for the 2010 fiscal year, forecasting it at $1.26 trillion, or 8.5 percent of GDP, and up $87 billion from the $1.17 trillion projection given in February.
After taking office in January, Obama released a bare-bones version of his budget in February that offered a spending plan for 2010 carrying a price tag of $3.55 trillion. The White House revised up the size of the spending plan to $3.59 trillion.
The U.S. economy shrank at a surprisingly steep 6.1 percent rate in the first three months of this year.
CLOSING THE GAP
The new White House figures bring the deficit estimates closer in line with the non-partisan Congressional Budget Office, which has forecast a $1.85 trillion deficit this year and $1.38 trillion in fiscal 2010.
To allay worries about the deficit and fend off Republican attempts to paint him as a big spender, Obama over the past week has rolled out a series of announcements aimed at showing he is working to stem the red ink.
Last week, Obama said he could wring $17 billion in savings from his budget by cutting waste in areas from weapons systems and education to the cleanup of abandoned mines.
But the cuts in 121 programs amounted to less than one-half of 1 percent of the total budget for 2010 and even the slim list of reductions is likely to face resistance in Congress.
Obama also unveiled new details of his plan to toughen tax policies for multinational companies that invest abroad and to close loopholes on overseas tax shelters. Many businesses strongly oppose the proposed changes for multinational firms.
Later on Monday, Obama will preside over a White House forum aimed at highlighting budget savings that could be reaped by making the healthcare system more efficient.
Trade groups such as the American Medical Association and the American Hospital Association as well as labor unions are expected to present Obama with a letter pledging to reduce the growth of health spending by 1.5 percentage points annually.
The cost savings would be achieved through steps such as streamlining paperwork and changing the way hospitals deliver and bill for services to patients.
But the healthcare event appears likely to gloss over the political battle looming over Obama's push to establish a new public health insurance plan to help cover the estimated 46 million uninsured Americans.
http://finance.yahoo.com/news/White-House-forecasts-higher-rb-15199206.html?.v=3
So.. the White House had to up the estimated deficit this year by 89 BILLION dollars.. but to compensate for it, he's claiming saving 17 BILLION?
I watched a documentary about Joseph Stalin this weekend.. and before you freak out and post "OMG HE R COMPARING OBAMA 2 STALIN!!".. I'm not. I did walk away from the show thinking that no matter what Obama does, people still blindly love this guy and will excuse pretty much anything he does... much like Stalin was beloved in Russia up until he died.