-Caveat Lector- .............................................................. >From the New Paradigms Project [Not Necessarily Endorsed] Note: We store 100's of related "conspiracy posts" at: http://www.msen.com/~lloyd/oldprojects/recentmail.html From: "Alex Constantine" <[EMAIL PROTECTED]> To: "Lloyd" <[EMAIL PROTECTED]> Cc: "Kris" <[EMAIL PROTECTED]> Subject: No Budget "Surplus" Date: Wednesday, October 11, 2000 5:18 AM Wahington Post Beyond Surpluses, CBO Finds Grim Budget Picture By Glenn Kessler Washington Post Staff Writer Saturday, October 7, 2000; Page A02 The ever-growing budget surpluses, which earlier this year spurred the leading presidential candidates to boost their tax cut and spending plans, have done little to change a grim long-term financial outlook for the United States, the nonpartisan Congressional Budget Office said yesterday. Even under the most optimistic scenario--in which politicians agree to save every penny of the surplus and use it to pay off the national debt--the cost of providing promised health and retirement benefits after the baby boom generation leaves the workforce will ultimately overwhelm the federal budget, the CBO concluded. "If the nation's leaders do not change current policies to eliminate that imbalance, federal deficits are likely to reappear and eventually drive federal debt to unsustainable levels," the CBO said. In particular, the agency said, spending on Medicare, which provides health care for retirees, and Medicaid, the health program for the poor, will triple in four decades when measured as a percentage of the nation's economy. The report underscores how campaign rhetoric has become increasingly separated from the budget reality that will face the next president. Lawmakers are piling on billions of dollars in extra spending as they rush to complete the session, leaving less available for debt reduction. Many analysts also say projections of nearly $5 trillion in surpluses over the next decade rest on a number of questionable assumptions, and the actual amount could be much less. Indeed, though both the White House and Congress have been quick to claim credit for balancing the budget, the CBO noted that the sudden turn in the nation's financial picture was due to other factors. "Most of the improvement stems from unexpected increases in revenue and slower-than-anticipated growth in some spending rather than from changes in policy," the report said. The question of how to spend the projected bounty dominated the presidential and vice presidential debates this week. But candidates tangled mostly not on how to save it but whether it was best to devote a large chunk of the surplus to tax cuts or additional spending. "There's enough money to pay seniors today in the current affairs of Social Security," said Texas Gov. George W. Bush, the Republican nominee, as he defended his plan to use about $1 trillion of the Social Security surplus to establish individual retirement accounts. "The trillion comes from the surplus. Surplus is more money than needed." Vice President Gore, for his part, declared, "If we can keep our prosperity going, if we can continue balancing the budget and paying down the debt, then the strong economy keeps generating surpluses." Bush also suggested that his plan to cut taxes $1.6 trillion over 10 years would boost economic growth. But the CBO report said that "growth alone is unlikely to eliminate projected long-term imbalances because it may lead to increased spending on many programs," including Social Security and Medicare. Social Security benefits, for instance, are tied to a person's earnings history, so better wages would mean higher benefits. The CBO considered three scenarios--saving all the surplus, saving only the Social Security surplus and saving none of the surplus. The middle-ground solution closely reflects how the candidates present their plans, though each side says the other busts the budget. But the CBO said that even if the government took the controversial step of using the surplus to invest in stocks and bonds after the debt was paid off, rising health care and retirement costs would push the budget back into deficit in 2027. Notwithstanding the CBO's warnings, officials from both campaigns seized on the report yesterday to say it made the case for their own budget plans. Jason Furman, senior economic adviser to Gore, noted there is "tremendous uncertainty" in making 70-year forecasts and that the CBO used slightly more pessimistic assumptions on productivity and health care costs than the administration. "But what is clear is that Al Gore and Joe Lieberman devote two-thirds of the surplus to paying down the debt, which is the best way to prepare for whatever challenges tomorrow may bring," Furman said. He added that Bush's tax cut and his plans to use part of the surplus for Social Security and Medicare reform "would leave America permanently in debt." Ari Fleischer, a Bush spokesman, said, "It's a real wake-up alarm. Gore is napping while Governor Bush is reforming. This alarm bell reinforces everything that Governor Bush has been saying." Fleischer said that the report makes it clear that "it doesn't matter if you cut taxes or don't cut taxes, because the reform needs to be made." Robert Reischauer, a former CBO director who is president of the Urban Institute, said the report emphasized that the growing cost of health care, both in government programs and the private sector, will be the primary challenge of future policymakers. The "surprising and inexplicable" slowdown in health care costs in recent years is one of the main factors behind the budget surpluses, he said. But the report demonstrated that those costs will once again begin to eat up the budget unless action is taken on every level of the health care system. "The strong economy and slowdown in health care cost increases moved this issue off the front burner," Reischauer said. "That won't last long." � 2000 The Washington Post Company Forwarded for info and discussion from the New Paradigms Discussion List, not necessarily endorsed by: *********************************** Lloyd Miller, Research Director for A-albionic Research a ruling class/conspiracy research resource for the entire political-ideological spectrum. **FREE RARE BOOK SEARCH: <[EMAIL PROTECTED]> ** Explore Our Archive: <http://a-albionic.com/a-albionic.html> <A HREF="http://www.ctrl.org/">www.ctrl.org</A> DECLARATION & DISCLAIMER ========== CTRL is a discussion & informational exchange list. Proselytizing propagandic screeds are unwelcomed. Substance�not soap-boxing�please! These are sordid matters and 'conspiracy theory'�with its many half-truths, mis- directions and outright frauds�is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. 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