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Strong Economic Growth Reduces Budget Deficit
WASHINGTON – Wisconsin’s First District Congressman Paul Ryan today made the following statement after the Office of Management and Budget (OMB) released its annual mid-year budget update, which shows that its deficit forecast for this year has declined 30 percent from $423 billion to $296 billion, largely as a result of increased tax revenues:
“Lowering taxes has fueled sustained economic growth and job growth that ultimately bring more tax dollars into the Treasury, which helps us reduce the deficit. At the same time, we need to restrain spending, and we’re working hard to do this through budget reforms such as my legislative line-item veto and overall efforts to control spending,” said Ryan. “Today’s announcement of lower deficit projections shows that tax relief paired with spending controls can put our fiscal house in order and eliminate the deficit.”
The OMB’s Mid-Session Review reports:
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This year’s budget deficit is now forecast to be $296 billion, or 2.3 percent of our economy (GDP), equal to the 40-year historical average. This deficit is 30 percent below the Administration’s February forecast.
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The improved deficit outlook continues over the next five years, indicating that the President is on track to meet his goal of cutting the deficit in half by 2008, a year ahead of schedule, from its projected 2004 peak of 4.5 percent of GDP, or $521 billion.
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Pro-growth economic policies have fueled a robust expansion which has, in turn, increased tax revenues at a rapid pace. Revenues grew by 14.5 percent last year, and tax receipts are forecast this year to grow by about 11 percent.
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Contact: Kate
Matus (202) 226-7326
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