Tuesday, July 11, 2006

Bush shaves some more off the deficit

Thank God. I'm glad we're seeing some more data coming through after the National Review and Investor's Business Daily articles claiming Bush is ahead of schedule as far as cutting the budget deficit in half.

July 11 (Bloomberg) -- The Bush administration cut its estimate of this year's budget deficit by 30 percent to $296 billion amid a surge in tax collections from corporations and wealthy individuals.

The projected shortfall is down from the $423 billion deficit the White House forecast five months ago and represents 2.3 percent of gross domestic product, according to the Office of Management and Budget. Last year's deficit was $318 billion.

[...] The lowered forecast for the fiscal year ending Sept. 30 is driven by higher than expected tax receipts as the economy grew at an annual rate of 5.6 percent in the first quarter, the fastest in two and one-half years. Government revenue has risen 11 percent so far this year even as the war in Iraq -- a total of $319 billion so far -- and the rebuilding of the Gulf Coast after last year's hurricanes -- more than $100 billion -- has pushed up spending.

The government makes more money when they take less from the people. The tax money the fetching Mrs. Wookie and I got back went into buying more furnishings for the house, clothes, wedding gifts, and are going to go into baby stuff and hopefully a vacation in the coming weeks. Think of who gets money on all that. The retailers, the manufacturers, and the suppliers, not to mention the employees for these companies who get to keep their jobs (and who will continue to get taxed and not have to go on government assistance). Those companies make money, hopefully enough to grow to generate more profit, and that's more tax money for the government.

This is much more akin to the republican philosophy on spending. Now if we can just start to cut some off the "Nanny-state" government programs, we'll be in even better shape...

UPDATE @ 12:13pm: Ace also posts on the shrinking deficit. He pulls this bit from a Larry Kudlow article over at Townhall.

Did you know that just over the past 11 quarters, dating back to the June 2003 Bush tax cuts, America has increased the size of its entire economy by 20 percent? In less than three years, the U.S. economic pie has expanded by $2.2 trillion, an output add-on that is roughly the same size as the total Chinese economy, and much larger than the total economic size of nations like India, Mexico, Ireland and Belgium.

This is an extraordinary fact, although you may be reading it here first. Most in the mainstream media would rather tout the faults of American capitalism than sing its praises. And of course, the media will almost always discuss supply-side tax cuts in negative terms, such as big budget deficits and static revenue losses. But here's another suppressed fact: Since the 2003 tax cuts, tax-revenue collections from the expanding economy have been surging at double-digit rates, while the deficit is constantly being revised downward.

You want to talk about tax cuts for the rich now?