The Federal Budget Outlook

Despite a federal budget deficit of about $400 billion, President Bush and Republicans in Congress say that spending is under control and that the budget outlook is improving. Proposed spending growth in President Bush’s fiscal year 2007 budget is below the large increases of prior years. But are the White House and Congress doing enough to restrain spending? What will happen to the budget as entitlement costs explode in coming years? Have Republicans created enough budget room to extend the president’s supply side tax cuts?

Donald Marron will discuss the newly released CBO projections for federal revenues and spending. Stephen Slivinski will discuss the outlook for spending and the administration’s proposed changes in department and agency funding. Chris Edwards will discuss the budget’s tax proposals and comment on the danger of rising taxes if spending is not cut in coming years.