Federal Deficit

There is a popular misconception being promoted these days that entitlement spending is one of the reasons we have such large budget deficits ("Entitlements Haunt Congress' Budget Cutting," July 26). Leading the pack is Social Security. But it is not possible for Social Security to contribute to the national debt. The Social Security Trust Fund is solvent. It cannot be used by the government for anything other than as a source of borrowing. It should not even be included in the federal budget (but was put there in the 1980s to mask the size of the debt)

I disagree that the cause of the recent record deficits lies in the Reagan tax cuts. These cuts released a record amount of investment and entrepreneurial activity that created millions of new jobs and one of the longest peacetime expansions in the history of this country. The true cause of the record increase in the deficit lies in the rapid growth of government spending over the past decade, particularly during the Bush Administration. In fact, the Gramm-Rudman Act was reducing the deficit and would have wiped it out if the President and Congress had not abrogated the agreement with the ill-conceived budget deal of 1990.

While the Reagan-Bush White House was spending us into oblivion with a huge and mostly unnecessary military build-up, they were cutting taxes and creating a national debt that must be the eighth wonder of the world. During those "wonderfully prosperous 1980s" we continued to go into debt. Why couldn't they realize that during prosperous times you're supposed to save your resources, or at least pay off your old debts in anticipation of not so prosperous times that may lie ahead. Now we must prime the pumps; we must spend our way out of the mess we're in, no matter the enormity of the debt.

A wave of bleak news about the stagnant economy promises to give opponents of President Obama's expansive domestic agenda more ammunition to argue that this is an inopportune time to enact overhauls of the nation's healthcare and energy policies. As part of its fiscal mid-year review, the Obama administration projected today that the United States will run a $9-trillion deficit over the next decade -- $2 trillion more than it had estimated in February when its budget initially was outlined.

The weak economy and the mammoth costs of helping the savings and loan industry will soon push the federal deficit to records surpassing $300 billion per year, a congressional study said today. But by 1993, the newly enacted deficit-reduction law and an improving economy should begin shrinking the federal shortfall, the Congressional Budget Office said in a report presented to the House Budget Committee.

Here's one way Congress can trim the nation's record deficits: Do nothing. Keeping Congress gridlocked on budget issues would cut the projected annual federal deficit in half by the next fiscal year and set the trend on a downward path for years to come. Legislation already on the books, if left alone, would do several things: Tax cuts passed under President George W. Bush's administration would expire Dec. 31, generating more revenue. And deep budget cuts passed as part of last summer's debt ceiling deal would be automatically triggered, slashing spending in 2013.

As President Obama presents his first budget today, the most daunting goal he has set may not be the ambitious proposals for economic recovery, healthcare reform or revamping the nation's energy policy. Big as those challenges are, they may be child's play compared with his promise to slash the federal budget deficit in half by the end of his first term. Two problems already are apparent if Obama is to cut the $1.3-trillion deficit to $533 billion.

This year's federal deficit will probably hit $401 billion, the nonpartisan Congressional Budget Office projected as data continued to indicate that the red ink would reach its highest level ever. The number is $54 billion less than the shortfall that President Bush's budget office predicted last month. The congressional analysts said most of the difference -- $40 billion -- was because they expect lower spending than the White House calculated.

As Republicans began the process of trying to repeal the healthcare reform law, the Congressional Budget Office warned Thursday morning that doing so would add to the federal deficit and expand the ranks of uninsured Americans. On the second day of the 112th Congress, Republicans moved to fulfill a campaign promise as the House Rules Committee, chaired by Rep. David Dreier (R-San Dimas), held a hearing on HR 2, the proposed "Repealing the Job-Killing Health Care Law Act. " "This law is a job killer," said Rep. John Kline (R-Minn.

The Times correctly points out ("Deep Shade of Red Seen in Deficit," Sept. 8) that voters are not really concerned about the federal deficit and the cost of the national debt. The seriousness of the ever-growing national debt is not often mentioned by politicians because the only solution is to raise taxes and/or make draconian cuts in the federal budget. The reason for this silence goes back to the 1984 Democratic National Convention. Under President Reagan, the national debt had soared, mostly because of the tax cuts he got through the Congress.