The Budget and Economic Outlook: An Update
CONGRESSIONAL BUDGET OFFICE (U S CONGRESS) WASHINGTON DC
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The nations fiscal situation has not changed much since the Congressional Budget Office CBO issued its previous baseline budget projections in March. Although the deficit for fiscal year 2004 is anticipated to be 56 billion lower than CBO estimated then, the deficits projected for 2006 and beyond have grown. In the absence of further legislation, the federal government will record a total budget deficit of 422 billion in 2004. That deficit would represent a record level in dollar terms, but at 3.6 percent of the nations gross domestic product GDP, it would be smaller than the deficits of the mid-1980s and early 1990s relative to the size of the economy during which time deficits frequently exceeded 4 percent of GDP. Under the laws and policies currently in place, the deficit is projected to decline to 348 billion, or 2.8 percent of GDP, in 2005, and outlays are estimated to continue to exceed revenues through 2014. Consequently, in CBOs projections, the cumulative deficit for 2005 through 2014 totals 2.3 trillion, or 1.5 percent of total GDP That outlook is substantially the same as it was in CBOs previous baseline projections, which cited a cumulative deficit of 1.3 percent of GDR.
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