WASHINGTON - The budget plan proposed by President George W. Bush would keep the US government in deficit over the next 10 years, a preliminary analysts by the Congressional Budget Office showed Friday.
The CBO said that its original budget forecast calling for the deficit to turn into a surplus by fiscal 2012 would have to be revised if the budget plan were adopted.
"Under the president's policies, deficits would continue throughout the 10-year period," the report said.
"Over the 10-year period from 2006 through 2015, deficits would total 2.6 trillion dollars under the president's budget -- 1.6 trillion higher than CBO's current baseline projection of the cumulative deficit."
However, the CBO said that deficit for the current fiscal year may be somewhat lower than the White House estimate -- 394 billion dollars compared with the administration estimate of 427 billion.
That would be slightly below last year's deficit of 412 billion dollars, a record in dollar terms. It would also be 3.2 percent of total gross domestic product.
CO director Douglas Holtz-Eakin said the deficit projected for the 2006 fiscal year starting October 1 would be 278 billion dollars. But that figure does not include costs of operations in Iraq and Afghanistan, which have not been submitted to Congress for that period.
Holtz-Eakin said a lack of details makes it difficult to provide accurate forecasts for the coming years.
"Under the president's budget, the deficit would decline further -- to 2.0 percent of GDP -- in 2007 and then drop to 1.3 percent by 2015," he said.
But he added, "Those percentages reflect neither significant spending for military activities in Iraq and Afghanistan nor the potential budgetary impact of the president's proposal to provide individual investment accounts under the Social Security program."
A more detailed analysis was to be released March 15. Lawmakers meanwhile said they would be developing their own budget proposals.
"The economy is in full swing, jobs are being created and the deficit projections continue to fall," said House Budget Committee Chairman Jim Nussle.
Nussle said he will submit his own budget plan next week, which "will promote continued growth, continued strength and restrained spending."
Democrats said CBO analysis hardly presents an optimistic picture.
"Todays analysis from CBO is the latest in a long line of evidence, all indicating that the administrations fiscal policies are moving us deeper and deeper into debt," said Representative John Spratt, the senior Democrat on the budget committee.
"The administration claims that it is making headway on the deficit, but CBO's analysis runs the president's budget out 10 years and shows that his budget will not even come close to balance ... As bad as these estimates seem, the true picture is even worse. CBO's deficits do not reflect the cost of policies the administration supports but omits from its budget, such as 754 billion dollars to start up Social Security privatization; or operations in Iraq and Afghanistan for 2006 and beyond, now running over five billion dollars a month."
03/04/2005 22:36 GMT