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Economic News, Data and Analysis

Budget Situation Worsens

More bad news on the deficit front. The CBO is projecting a $400 billion deficit (about 4% of GDP) for 2003.
This is the largest nominal deficit on record, and the largest percentage of GDP since 1992. (See historical budget data. )

Monthly Budget Review
CBO now projects that the federal government is likely to end fiscal year 2003 with a deficit of more than $400 billion, or close to 4 percent of gross domestic product. The deterioration in the short-term budget outlook stems from
continued weakness in revenue collections and from enactment of the Jobs and Growth Tax Relief Reconciliation Act of 2003, which will add an estimated $61 billion to this year’s deficit in the form of tax cuts, refundable credits, and
aid to states.

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Filed under: Economics, Economy, Fiscal Policy, Policy

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