Budget Deficit Now Put At $2 Trillion
MELISSA BLOCK, host:
From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.
MICHELE NORRIS, host:
And I'm Michele Norris. Lawmakers on Capitol Hill are bracing themselves for another round of bad economic news. This time, it's about the budget. Leading Democrats had already expected this year's budget deficit to be the deepest ever, at $1.2 trillion. But tomorrow, the non-partisan Congressional Budget Office will release a new estimate that is far worse.
NPR's Andrea Seabrook is at the Capitol, and joins us now.
Andrea, how bad will the budget deficit be?
ANDREA SEABROOK: Michele, $2 trillion. That is what top lawmakers expect the non-partisan Congressional Budget Office to report tomorrow. The CBO's last estimate of this year's budget, just for - to compare, was $1.2 trillion. So that's a giant jump in the amount of debt the federal government is expected to take on this year.
NORRIS: A giant jump, indeed. What changed? How did the outlook get so much worse so fast?
SEABROOK: Well, a couple of things happened. Congress passed a couple of big bills that spent huge amounts of money: the economic stimulus bill and omnibus bill that was to fund the federal government for the rest of this fiscal year. Plus, the CBO, the Congressional Budget Office, was able to plug in new information about the American economy from the last couple of months of last year. And remember, that information was overwhelmingly negative: slowing growth, lower government revenues. So this is like a double whammy on the budget, and it adds up to hit that number of $2 trillion. And remember, the deficit, that $2 trillion is how much more money the government has - that it will spend than it has.
NORRIS: Now what does all this mean for President Obama's budget proposal? Because inside that proposal, he has a long list of policy changes that cost a lot of money.
SEABROOK: He sure does. And exactly - to be fair, though, the Obama administration and most members of Congress knew this was going to be a bad number. They saw it coming. But, you know, when you say $2 trillion, it still kind of slaps them in the face. And it causes a political problem for Democratic leaders in Congress and the Obama administration. Will there be the political will to support overhauling heath care, for example, when that requires spending hundreds of billions of dollars more?
I asked House Speaker Nancy Pelosi about this today, and she said, yes. The budget situation is getting worse, but that's not a reason to cut back on their priorities.
Representative NANCY PELOSI (Democrat, California; Speaker of the House): The downturn in the economy that we are suffering now insists that we make these investments.
SEABROOK: Then again, the Republicans are finding in this number fuel for their arguments that the government can't spend its way out of this crisis. Listen to Paul Ryan. He's the top Republican on the House Budget Committee.
Representative PAUL RYAN (Republican, Wisconsin): Clearly, the economic policy they've employed is not working. It is making our fiscal balance sheet look terrible. It is giving us a tidal wave of debt, and we need to focus on economic growth.
SEABROOK: And Michele, in between Democrats and Republicans, there is a growing group of moderates who are arguing that, yes, overhauling health care, pumping new money in education and energy, it's good, but it's just too much, too fast.
NORRIS: Thank you, Andrea.
SEABROOK: You're welcome.
NORRIS: That's NPR's congressional correspondent Andrea Seabrook.
NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.