Alan Greenspan hit a hornet's nest when he disparaged the Bush fiscal policy record in his new book. Responding to Greenspan's comments, President Bush, yesterday: "I would also argue that cutting taxes made a significant difference, not only in dealing with a recession and an attack on our country, but it also made a significant difference in dealing with the deficit because the growing economy yielded more tax revenues, which allowed us to shrink the deficit." Vice President Cheney, today:

To follow up on yesterday's post, Debt on Arrival, the Senate Finance committee acted today, voice voting to increase the debt limit by $850 billion to close to $10 trillion. That's a 14-digit figure, in case you are counting.

An "Economic Snapshot" offered today by Max Sawicky of the Economic Policy Institute brings home the sobering cost of extending the Bush tax cuts of earlier this decade, measured two ways. It shows that, all other things being equal, despite "out of control" projected growth in Social Security, Medicare, and Medicaid spending, the cost of these benefits in 2017 will be dwarfed by the cost of Bush tax cuts and related revenue policies, excluding interest costs associated with debt payments.

CBO's The Budget and Economic Outlook: An Update is a statute-directed baseline: "In accordance with long-standing procedures, CBO's projections assume that current laws and policies remain in place." So, the revenue figures in years 2010-2017 reflect a scenario in which the 2001/2003 tax cuts expire (as legislated). If Congress does nothing - that is let the sun set on tax cuts, the Treasury will see surpluses starting in 2012. But if those tax cuts are extended, it's a river of red ink. Federal Budget Surplus/Deficit(-) (billions of dollars) 2012 2013 2014 2015 2016 2017