Richard Kogan points out once again that the Bush tax cuts have played a much larger role in generating our present and future expected government budget deficits than has the War on Terror.
Posted by DeLong at July 8, 2003 01:17 PM | TrackBackWar, Tax Cuts, And The Deficit, Revised 7/8/03: ...The cost of war, though by no means trivial, is responsible for only a small share of the deficits we face. The President’s tax cuts are a much more significant cause. Congressional Budget Office data indicate that in 2003 and 2004, the cost of enacted tax cuts is almost three times as great as the cost of war, even when the cost of increases in homeland security expenditures, the rebuilding after September 11, and other costs of the war on terrorism -- including the action in Afghanistan -- are counted as “war costs,” along with the costs of the military operations and subsequent reconstruction in Iraq...
Let's see: yesterday, the administration admitted that electricity and water in iraq are below pre-war levels.
today, they admitted that the nigeria story was bs.
Are they going to go for the "trifecta" of honesty and admit where the budget deficit came from?
(I doubt it.)
Posted by: howard on July 8, 2003 02:41 PMAs I read it, Kogan concedes that, regardless of the policy choices made, we'd be in deficit today.
And apparently he concedes that the administration critics were wrong about the cost of the war.
Posted by: Thomas on July 8, 2003 03:39 PMAs I read it, Kogan concedes that, regardless of the policy choices made, we'd be in deficit today.
And apparently he concedes that the administration critics were wrong about the cost of the war.
Posted by: Thomas on July 8, 2003 03:42 PMThomas, that begs the question - What are you reading? Kogan says nothing about whether we'd be in deficit regardless of policy decisions. He says that a far greater share of the deficit is from tax cuts than the War on Terrorism and the War on Iraq combined. There is also nothing about anyone being wrong about the cost of war.
Posted by: Dan on July 8, 2003 03:53 PMDan, presumably Thomas is looking at the "$90B" number, but he probably didn't bother to read the notes. That $90B is based on assumptions that won't pan out, like that we will only spend $18B in Iraq next year (we will only if the administration admits that the coalition of the willing is insufficient for securing and reconstructing Iraq).
So the war costs will be higher, and therefore the deficit will be higher than this projection shows, and therefore a tiny percentage more of the budget deficit will result from the generously defined "war on terrorism," but the underlying point remains the same: it's the tax cuts, stupid.
Posted by: howard on July 8, 2003 06:00 PMHoward, even if Bush tries to augment the 'coalition of the billing' ^H^H^H^H^H willing', it might not work too well. Most European peoples strongly opposed the war,
and a guerilla war is running. It would be crazy for any government to send in forces/reconstruction teams under those circumstances. The only way I can see for that to happen is that Bush (quietly) threatens an oil blockade. This, of course, would decimate the world's energy markets, probably leading to Depression II (with the Great Depression being renamed as Depression I).
Get it. The problem, the Administration told us, was a surplus that would eat Cleveland. Had to cut taxes so the government would not spend spend spend. Cut taxes, for the richest naturally, and watched a needed surplus turn to an endless deficit. The Administration has given us a horrid fiscal policy designed to end the legacy of the New Deal. Well, I really do like social security.
Posted by: lise on July 9, 2003 08:48 AMhttp://www.cbpp.org/7-2-03bud.htm
"In March of this year, the Congressional Budget Office projected that large deficits in 2003 and 2004 would be followed by falling deficits thereafter, a budget surplus within five years, and large and growing surpluses within ten years. Even accounting for the recently enacted tax cuts and supplemental appropriations to fund the Iraq war, CBO’s projections imply steadily improving budgets. But such a conclusion would be considerably too optimistic: CBO’s figures omit as much as $4.3 trillion in costs over the next ten years, costs that result from legislation that Congress is likely — and in many cases, virtually certain — to enact. With these extra costs, the deficit over the ten year from 2004 through 2013 would total $4.1 trillion."
Posted by: lise on July 9, 2003 09:54 AM