The budget deficit for the current year is projected to come in well below what was estimated just a few months ago … The Congressional Budget Office cites higher tax revenues and better-than-expected bailout repayments by mortgage giants Fannie Mae and Freddie Mac as the key reasons for the improved outlook.
Republicans were ready to deep six Fannie and Freddie, negating any revenue benefits now. The tax increase on the wealthy forced them to declare higher earnings before taxes went up, which spiked revenues. Of course future income taxes on the wealthy will continue the revenue stream, bringing down the debt. Under Romney/Ryan, we would be dismantling everything Democratic, just like in Wisconsin.
The budget office now predicts a 2013 budget deficit of $642 billion, more than $200 billion below its February estimate. This year's shortfall would register at 4 percent of the economy, far less than the 10.1 percent experienced in 2009 when the government ran a record $1.4 trillion deficit.
The deficit picture is expected to continue to improve next year and beyond, with the 2015 deficit now projected at $378 billion, just 2.1 percent of the economy. The shortage will fall below 3 percent of the economy for several years, levels considered by many economists to be sustainable.