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Deficit projections skyrocketing, Tuesday, August 25, 2009, Obama agenda, White House budget office, Congressional Budget Office, CBO, 2 trillion jump

From Reuters:

“New deficit projections pose risks to Obama’s agenda”

“WASHINGTON (Reuters) – President Barack Obama’s domestic policy proposals will face the reality of skyrocketing deficits on Tuesday when officials release two government reports projecting huge budget shortfalls over the next decade.

The White House budget office and the Congressional Budget Office (CBO), a non-partisan arm of Congress, release updated economic forecasts and deficit estimates on Tuesday, providing further fiscal fodder to opponents of Obama’s nearly $1 trillion healthcare overhaul plan.

Many of the figures are already known.

The White House has confirmed that its deficit estimate for the 2009 fiscal year, which ends September 30, will inch down to $1.58 trillion from $1.84 trillion after eliminating billions of dollars originally set aside for bank rescues.

Looking forward, an administration official told Reuters the 10-year budget deficit projection will jump by about $2 trillion to roughly $9 trillion from an original forecast of $7.1 trillion.”

“Many economists think it is unlikely that the government can curtail spending, which means taxes would have to rise to cover the increasing costs of providing retirement benefits and healthcare to older people. That could slow economic growth.

Stanford University economics professor John Taylor, an influential economist, told Reuters Television on Friday the U.S. budget deficit poses a greater risk to the financial system than the collapse in commercial real estate prices.”

Read more:

http://www.reuters.com/article/politicsNews/idUSTRE57M0WV20090823