U.S. deficit to soar to $2.4 trillion

Congressional Budget Office predicts record shortfall

? The government’s budget outlook deteriorated further Monday as the Congressional Budget Office projected nearly $2.4 trillion in deficits over the next decade, providing new fuel for an election-year battle over soaring federal shortfalls.

Along with the forecast, almost $1 trillion worse than estimated in August, Congress’ nonpartisan fiscal watchdog said this year’s deficit would hit $477 billion. That would be a record in dollar terms.

Although the report envisioned red ink ebbing to $362 billion next year and receding thereafter, it stirred up Democrats, who blame President Bush for squandering the unprecedented surpluses of just three years ago; and conservative Republicans, who say he has let the budget spin out of control.

“He’s been completely irresponsible,” presidential hopeful Sen. John Edwards, D-N.C., said in New Hampshire, underscoring Democrats’ hopes that the issue is catching on. “We can’t afford four more years of the right-wing Republican administration,” candidate Howard Dean said. “Republicans don’t balance budgets; Democrats do.”

“These budget deficits as far as the eye can see are the predictable result of a president and Congress spending taxpayer dollars with reckless abandon,” said Brian Riedl, who studies the budget for the conservative Heritage Foundation.

The highest deficit ever was last year’s $375 billion.

Bush sends Congress his $2.3 trillion budget for 2005 next Monday. It will propose holding nondefense, nondomestic security spending to about 0.5 percent growth, with a goal of halving deficits by 2009.

“The president has a plan to cut the deficit in half over the next five years, and that’s what we intend to do,” said White House spokesman Scott McClellan.

Critics from both parties say the actual shortfalls could be even worse than projected because the budget office excluded the cost of extending tax cuts and other items that are set to expire in coming years. Lawmakers are considered likely eventually to enact such extensions.

In addition, the report’s numbers do not extend far enough to catch the brunt of the retirement of the baby boom generation, which will foist huge costs on Social Security, Medicare and other income-support programs.

“Even if economic growth turns out to be greater than projected, however, significant long-term strains on the budget will start to intensify within the next decade” from the mass retirements, the report said.

Conservatives, who have been rebelling openly for weeks over the growth of spending and deficits on Bush’s watch, said Monday his proposals for corrective action were too timid.

Rep. Mike Pence, R-Ind., said he and other conservatives were working on a budget that would balance in five years and be even more stringent on spending, perhaps cutting programs that Congress controls.

“I think Congress can do better, and I think we should make it our purpose to present a bolder fiscal vision than the administration will put forward,” he said.