Congressional Budget Office Forecasts U.S. Federal Deficit to Rise Beyond Previous Predictions

With economic conditions in the United States continuing on a downward spiral that have left President Obama's administration estimates well over $1.8 trillion higher than initial estimates had predicted means that administration "budget proposals, if carried out, would produce a staggering $9.3 trillion in total deficits over the next decade."

Huge scary numbers no matter from which political persuasion the deficit is viewed. This news means that during the decade from 2010 to 2019, there will be an excessive debt of $2.3 trillion generated according to the Congressional Budget Office; that translates to deficits of close to $1 trillion a year for the next ten years.

"... although Obama would come close to meeting his goal of cutting the deficit in half by the end of his first term, the CBO predicts that the nation's annual operating deficit would never drop below 4 percent of the overall economy over the next decade, a level administration officials have said is unsustainable because the national debt would grow too rapidly."

That translates to the CBO's opinion that national debt will increase by 82% "of the overall economy by 2019 under Obama's policies, compared with a pre-recession average of 40 percent."

The CBO estimates will have a considerable political as well as economic impact on Obama's relations with Congress.

Congressional Democrats will most likely be forced to make fiscal adjustments to Obama's budgetary plans. Senate Budget Committee Chairman Kent Conrad (D-N.D.) met with President Obama this past week and "said the president "understands the legislative process" and that "it's going to require everyone to make adjustments."

House Speaker Nancy Pelosi, commenting on the CBO numbers and the budgetary plans of the administration and house Democrats said: "This budget is a statement of our values and our investments in education, health care and the health of America. That includes prevention as well as care, and the energy initiatives as well as tax relief for 95 percent of the American people, as well as an approach that takes the deficit down. Those are the priorities of the budget."

Following up on Pelosi's comments; Peter Orszag, administration budget director echoed the Speaker's comments: "There are always some adjustments," Orszag said of the legislative budget process. "But those four pillars" -- health care, education, clean energy and deficit reduction -- "will be represented."