This Wednesday the Office of Management and Budget announced that the FY2006 budget deficit was $248 billion/1.9 percent of GDP (Gross Domestic Product), down from an original February projection of $423 billion/3.2 percent of GDP. The new figures mean that Congress’s goal of cutting the deficit in half by 2009 has been met three years ahead of schedule.
“This is a very encouraging announcement,” commented Chocola. “We have to keep working until the deficit is non-existent, but this shows that the path to a balanced budget lies with pro-growth tax policy. The deficit is falling because we are keeping the American people’s taxes low, thereby encouraging them to save, spend, and invest, which has resulted in 19 consecutive quarters of economic growth. When the economy is growing, government revenues increase and the deficit decreases.”
