MercoPress. South Atlantic News Agency

Soaring US budget deficit

United States Congressional Budget Office, CBO, estimated this week the US budget deficit will reach a record 480 billion US dollars in 2004.

The biannual non partisan CBO report also confirmed a 401 billion US dollars deficit in 2003, and an accumulated deficit of 1,4 trillion US dollars for the next decade.

Last month the White House admitted that the federal deficit could reach 455 billion this year and 475 billion in 2004, well above the previous record of 290 billion in 1992.

The CBO report does not include the growing costs of the Iraq occupation operation that is estimated at a billion US dollars per week.

However Republican and Democrat Congress members agree that the 2004 estimate could be even higher, closer to 500 billion US dollars because of Iraq.

Democrats recall that the US managed a record surplus of 236 billion US dollars in 2000 and blame the bad shape of US finances to the Bush administration giant tax cut recently passed by Congress.

Republicans argue that tax cuts have kept the US economy humming and that these are considerably less, proportionately, to those approved in the eighties during the Reagan years.

"The administration's plan to cut the budget in half is a combination of strong economic growth and expenditure austerity. The economy seems to be picking up so we should now concentrate in keeping outlays under control", said Trent Duffy spokesman for the White House Budget and Management Office.

CBO estimates that the US economy will take off next year managing to achieve a 3,8% GDP expansion after growing 2,2% in 2003.