Washington ? Federal deficits should balloon to the $200 billion to $300 billion range in the next two years, President Bush’s budget director said Wednesday, a far bleaker view of the fiscal horizon than the White House had painted.

In remarks to the U.S. Chamber of Commerce and later to reporters, budget chief Mitchell Daniels also spoke of federal shortfalls “for the foreseeable future” and declined to say when surpluses might reappear, saying, “stand by.” The White House estimated last July that the red ink could fade to black by 2005.

Daniels’ somber outlook — which would put deficits near record levels — further roiled this year’s budget fight between Bush and congressional Democrats, particularly about the president’s $674 billion, 10-year tax-cutting proposal. Republicans say the plan would spark an economic revival that would help shrink deficits, which reappeared last year to the tune of $159 billion after four consecutive annual surpluses.

Democrats say Bush’s plan would worsen red ink even as possible war with Iraq, a potential Medicare expansion and other items threaten to widen the budget gap. They say now is when the government should be running surpluses to help buttress Social Security and Medicare for the retirement of baby boomers in less than a decade.

“It is the most reckless fiscal policy imaginable for our country,” said Sen. Kent Conrad of North Dakota, the Senate Budget Committee’s top Democrat.

Last summer, the administration projected that there would be deficits of $109 billion this year and $48 billion in 2004. At the time, Democrats criticized those numbers as overly optimistic.

In recent weeks, private forecasters have been issuing their own dreary fiscal assessments. Last week, the investment bank Goldman Sachs said it believes this year’s deficit will hit $300 billion and soar to $375 billion in 2004.

Daniels minimized the impact of the near-term deficits, saying they were so small compared to the size of the nation’s economy that they would be manageable.

The budget chief provided no specific numbers, but said deficits the next two years will be 2 percent to 3 percent of the size of the economy, currently estimated at $10.5 trillion.

“It’s important to keep our heads about this,” he said.

One Republican familiar with White House budget deliberations said he expected the deficits to hit about $200 billion this year and about $250 billion next year, excluding costs of a war.

Deficits of the size discussed by Daniels would approach the record $290 billion shortfall set in 1992 under the first President Bush. But compared to the size of the economy — which many analysts consider the best way to measure the country’s ability to afford deficits — the shortfalls peaked at 6 percent in 1983 and remained in the 4 percent and 5 percent range for much of the 1980s and 1990s.

“By historical perspectives, they are modest, they are manageable at this level,” Daniels said. “Our common goal ought to be to contain them.”

But Democrats said the White House was merely trying to contain the political damage of a budget spinning out of control. Just a decade ago, several noted, many in the GOP were adamant about controlling the era’s rising deficits.

“They’re whistling past the graveyard. They’re putting the best face they can on a bad situation,” said Rep. John Spratt of South Carolina, top Democrat on the House Budget Committee. “They want to cushion the impact as much as possible to make it seem like it doesn’t matter.”

Bush will release his 2004 budget on Feb. 3. Asked what it would do to control deficits, Daniels said, “It’s going to control spending and propose measures that will grow the economy, which is the only way back to surplus.”

Daniels said that while controlling the budget is important, it is not as a high a priority for Bush as protecting national security and strengthening the economy.

He blamed the worsened fiscal picture on a continued collapse of federal revenue collections, reflecting the weak economy and financial markets, as well as on the costs of battling terrorism. Democrats say the $1.35 trillion, 10-year tax cut enacted in 2001 has also driven up the shortfalls.

Daniels noted that his deficit projections exclude the price tag of any war with Iraq. He has estimated such costs at perhaps $50 billion to $60 billion, while former White House economic adviser Lawrence Lindsey estimated $100 billion to $200 billion.

Meanwhile, Agriculture Secretary Ann Veneman said Bush will seek a 1 percent increase next year for the government’s primary nutrition program for low-income infants, preschoolers and pregnant women, enough to reach an additional 400,000 people.