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[sundubuman]

from the NYT....


Surprising Jump in Tax Revenues Is Curbing Deficit

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By EDMUND L. ANDREWS
Published: July 9, 2006

WASHINGTON, July 8 � An unexpectedly steep rise in tax revenues from corporations and the wealthy is driving down the projected budget deficit this year, even though spending has climbed sharply because of the war in Iraq and the cost of hurricane relief.

On Tuesday, White House officials are expected to announce that the tax receipts will be about $250 billion above last year's levels and that the deficit will be about $100 billion less than what they projected six months ago. The rising tide in tax payments has been building for months, but the increased scale is surprising even seasoned budget analysts and making it easier for both the administration and Congress to finesse the big run-up in spending over the past year.

Tax revenues are climbing twice as fast as the administration predicted in February, so fast that the budget deficit could actually decline this year.

The main reason is a big spike in corporate tax receipts, which have nearly tripled since 2003, as well as what appears to be a big increase in individual taxes on stock market profits and executive bonuses.

On Friday, the Congressional Budget Office reported that corporate tax receipts for the nine months ending in June hit $250 billion � nearly 26 percent higher than the same time last year � and that overall revenues were $206 billion higher than at this point in 2005.

Congressional analysts say the surprise windfall could shrink the deficit this year to $300 billion, from $318 billion in 2005 and an all-time high of $412 billion in 2004.

Republicans are already arguing that the revenue jump proves that their tax cuts, especially the 2003 tax cut on stock dividends, would spur the economy and ultimately increase revenues.

"The tax relief we delivered has helped unleash the entrepreneurial spirit of America and kept our economy the envy of the world," President Bush said in his weekly radio address on Saturday.

Democrats and many independent budget analysts note that overall revenues have barely climbed back to the levels reached in 2000, and that the government has borrowed trillions of dollars against Social Security surpluses just as the first of the nation's baby boomers are nearing retirement.

"The fact is that revenues are way below what the administration said they would be a few years ago," said Thomas S. Kahn, staff director for Democrats on the House Budget Committee. "The long-term prognosis is still very, very bleak, and the administration doesn't have any kind of long-term plan."

One reason the run-up in taxes looks good is because the past five years looked so bad. Revenues are up, but they have lagged well behind economic growth.

The surge could also evaporate as quickly as it appeared. Over the past decade, tax revenues have become much more volatile, alternately soaring and plunging in the wake of swings in the stock market and repeatedly defying government projections.

Nevertheless, the short-term change has been striking. At the beginning of the year, the Congressional Budget Office projected that this year's deficit would be $371 billion and the White House Office of Management and Budget put the figure at $423 billion.

Corporate tax payments are expected to exceed $300 billion, up from $131 billion three years ago. The other big increase is an extraordinary jump in individual taxes that were not withheld from paychecks, usually a reflection of taxes on investment income and executive bonuses.

The jump in receipts is providing Mr. Bush and Republicans in Congress with a new opportunity to assert that tax cuts of 2001 and 2003 are working and that Congress should make them permanent.

Pat Toomey, president of the Club for Growth, a conservative political fund-raising group, said: "The supply-siders were absolutely right. All the major sources of revenue have grown, especially in areas where we said they would."

[Ya-ta Boy]

[Milwaukiedave]

Considering the deficit has ballooned out of control under the current administration, $100 billion off the deficit is nothing to get excited over.

[Nowhere Man]

Umm. Yes. The budget deficit dropping speaks nothing for the deficit.

But keep giving us the good news in this "renaissance".

[laogaiguk]

[Nowhere Man]

I disagree. He's the guy saying that, yup, our last 6 years of "steadfast leadership" have been hunky-dory.

[laogaiguk]

[sundubuman]

I'm posting facts.

Facts, such as bed times, are known to agitate children.

[sundubuman]

and this article is from the New York Times, hardly a cheerleader for anything but Coastal Elitist "Democratic" politics.


The deficit is shrinking rapidly.



Discuss.

[bucheon bum]

discuss?

Things would be better and the budget deficit would be even lower if Bush would actually veto a spending bill, and the Republicans weren't so hypocritical about big gov't and pork barrel projects.

Sadly Congress is going to read this report and think, "hey, sweet! more money to spend!" especially since it is an election year.

[ddeubel]

[sundubuman]

Master's Degree actually, and 2 BA's. Subscribe to the Economist, Fortune, and Foreign Affairs.

And yes, read them cover to cover.

And, again, this article was from the NYTimes, the media outlet most eager to see the Bush administration fail in any and all endeavors.

Lefty loonies hate to admit that rich Americans pay a hugely disproportionate amount of tax, which benefits all of society,.

Actually Ddeubel, it is you folks who abdicate independent thought, and are stuck reading and obsessing over Marx's Das Capital and various Chumpsky treatsies, dreaming of a society where smarmy pseudo-intellectuals run socialist bureaucracies that discourage ambitious folks from building business and wealth.

[Yu_Bum_suk]

[sundubuman]

The war in Iraq was against Saddam, that was won a long time ago. The current situation is a war betwen hard-core Sunnis and Shiites, the coalition forces (yes there are Brits, Koreans, Japanese, Australians and troops from many more countries) are more or less irrelevant to the violence. There are no battles, no war. Just a bunch pf maniacal holy warriors blowing up those from a different sect of Islam.


And Afghanistan has always been a narco-state.

And yes, both Afghanistan and Iraq have experienced greater freedom and democracy than they have ever known. Pick up the most recent Economist and read about Kabul's booming real estate market, ever-increasing numbers of cell-phones, and an economy that is growing at 14,5 % this year.

I know some of you idiotarians want the US to fail simply becuse it's the US, but really, why not wish for the best for the sake of the long-suffering folks in places like Baghdad/Kabul?

Are you suffering from *beep* envy so much that you'd rather see the US fail than succeed in its mission to free these two countries from the Taleban/Saddam and help them move towards democracy and freedom???

[huffdaddy]