Budget Update -- March 2005

The President’s budget projects a gradually reduced deficit over the next five years, from the $412 billion deficit in fiscal year 2004 (3.6% of GDP) to $207 billion in 2010 (1.3% of GDP). This decline mirrors the decline in the deficit projected under current law as the near-term budget outlook improves modestly. In fact, the President’s policies would actually increase the deficit over the five-year window. Furthermore, the budget relies on unrealistic assumptions and gimmicks to limit the size of the proposed deficit.

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