Spending the Old-Fashioned Way
At least one American appears comfortable spending beyond his means, and he lives in the White House. While President Bush may have "hoped to preside over a shrinking of the federal deficit in his final year in office," as the New York Times writes, the budget he proposed yesterday projects that the deficit, which had dropped the past three years, will rise to $410 billion in 2008 from $162 billion last year -- approaching the $413 billion record deficit of 2004. Mr. Bush maintains that the government will run a surplus by 2012, "but that outlook is based on scenarios considered unlikely by budget experts, congressional Democrats and even some Republicans," The Wall Street Journal writes. The paper notes that while the budget incorporates the $145 billion economic-stimulus package, which Congress is expected to pass this year, it doesn't factor in the economic slowdown itself. The administration's budget is based on productions of 2.7% economic expansion in 2008, but the Congressional Budget Office forecasts this year's growth at 1.7%. A slower expansion would mean less tax revenue and even higher deficits, the Journal says.

The proposal also projects "a fraction of the true costs" of the wars in Iraq and Afghanistan, fingering $70 billion for this year when the real price tag could reach $200 billion, the Washington Post reports, adding that the budget factors in zero war costs past 2009. The paper says federal debt will have risen by $4 trillion during the Bush administration, to $9.7 trillion by the time he leaves office. "Interest on the debt next year will total $260 billion, about what will be spent by the departments of Education, Energy, Health and Human Services, Homeland Security, Housing and Urban Development, Interior, and Justice combined," the Post writes. The new deficit projections "clearly make a problem not only for the next Congress but also the next couple of Congresses, and the next president, too," G. William Hoagland, former Republican Senate aide and budget expert who is now a health-care lobbyist, told tells the Post. The Journal notes that the budget sets up a battle between parties over tax cuts which are exacerbating the deficit. And this puts Democrats on the presidential campaign trail and in Congress in a bind, the Journal writes, because if the party allows tax cuts to expire as scheduled in 2010, they "would be, in effect, approving a $2 trillion tax increase at a time when polls suggest a weakening economy is making tax cuts more appealing to some voters."