News Release

July 13, 2005

Media Contact: (202) 789-5200

New White House Budget Numbers Are Nothing to Be Proud of
Cato analysts urge Bush Administration to curb spending

WASHINGTON -- On Wednesday, the White House revised its projected budget deficit for the 2005 fiscal year from $427 billion to $333 billion.

"A 2005 budget deficit of $333 billion is nothing for the Bush administration to be proud of," says Chris Edwards, Cato's director of tax policy studies. "It means that the government will still spend at least $333 billion too much this year. The administration's claim that it 'has held the line on spending' is nonsense. Total federal outlays will increase 7.9% in 2005 and an expected 5.7% in 2006. That is not holding the line.

"The 2001 and 2003 tax cut bills have helped the economy grow, but it would be growing faster without President Bush's huge spending increases in recent years. Bush's big spending on the war, education, farm subsidies, health care, and other areas have sucked money out of the productive private sector into often unproductive federal programs."

• "Bush's Overspending Problem," by Chris Edwards.

Stephen Slivinski, Cato's director of budget studies, adds, "The White House touts its 'responsible spending restraint.' Yet, the new numbers do nothing to change the fact that George W. Bush is the still biggest spending president since Lyndon Johnson. With restraint like that, who needs big spenders!

"It's true the budget numbers reported today show a smaller deficit. But this has nothing to do with spending restraint. It has everything to do with an unexpectedly high amount of tax money being collected. These estimates are actually bad news for the future of spending restraint. Congress is already adding more spending into the budget than the president requested. And with the unexpected flow of revenue rushing into the federal government coffers, the pressure to restrain spending just shrank. Congress is not very likely to say 'No' to all the lobbyists who will be fighting for their piece of the action now that there's more action to be had."

• "The Grand Old Spending Party: How Republicans Became Big Spenders," by Stephen Slivinski.

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