Half of 2004 Deficit Deterioration Due to Revenue-Reduction
by Guest Blogger, 9/4/2003
OMB Watch - Half of 2004 Deficit Deterioration Due to Revenue-Reduction Legislation
Half of 2004 Deficit Deterioration Due to Revenue-Reduction Legislation
The Congressional Budget Office (CBO) is currently estimating a baseline $401 billion deficit for 2003 and a $480 billion deficit for 2004. In March, just six months ago, the CBO's baseline indicated a much smaller $246 billion deficit for 2003 and a $200 billion deficit for 2004.
For 2004, this represents a $279 billion deterioration in the budget outlook (see Table 1). A detailed breakdown of the CBO data shows that 48% of the budget deterioration that occurred between March and August was due to legislative changes affecting revenue (see Table 2). At just over 16 percent of gross domestic product, revenue is now at its lowest level in 40 years.