The White House projected a steady fall in the US deficit over the next five years decade while the economy grows moderately, as it released its budget for the 2015 fiscal year today.
The budget foresees the economy growing 3.1 per cent this year and 3.4 per cent the next, with inflation remaining under control, rising to only 2.0 per cent in 2015.
The White House's modestly expansive budget will almost certainly be blocked in Congress, because it contains certain tax increases and spending rises that Republicans have rejected outright.
But it offers a view that the country's budget deficit, which boomed after the 2008 crisis, can be quickly brought down to comfortable levels, falling to USD 564 billion, or 3.1 per cent of GDP, in the fiscal year beginning October 1 and to 2.2 per cent of GDP by 2020.
The budget itself for the year beginning October 1 is projected at USD 3.9 trillion, up 6.8 per cent from the current year, with discretionary spending -- the third of the budget that excludes mandatory programs like social security and medicare -- barely changed at USD 1.014 trillion, because of prior agreements with Congress.
