Federal budget projections show deficits as far as the eye can see. Yet the Bush administration is proposing continued spending increases in its new FY2005 budget. Although deficits have plagued federal finances in the past, current deficits come just before the baby‐boom generation retires, which will put huge new strains on the budget.
Douglas Holtz‐Eakin will present the new Congressional Budget Office projections for revenues and spending and contrast them with projections in the Bush administration’s FY2005 budget. He will also discuss the long‐term fiscal crunch caused by the explosion in entitlement spending that begins later this decade. Chris Edwards will critique the new Bush budget and discuss how the budget can be balanced by cutting spending.