Bushist tax cuts spur profits, deepen deficit

[BurtWorm]

Surprise, surprise. :eyes:

http://www.nytimes.com/2004/10/08/politics/08deficit.html?pagewanted=print&position=

October 8, 2004
Tax Revenue Below 2000's Despite Growth in Profits
By EDMUND L. ANDREWS

WASHINGTON, Oct. 7 - Even after a year of solid economic growth and booming corporate profits, federal income tax revenues were lower in the fiscal year that just ended than in the year before President Bush took office, according to estimates by the nonpartisan Congressional Budget Office.

In a sign that Mr. Bush's tax cuts have had a bigger impact on the federal deficit than administration officials have often suggested, personal and corporate income taxes are both lower than they were in 2000 even though personal income and corporate profits are both substantially higher.

Based on the Treasury Department's tax receipts through Sept. 30, the last day of the 2004 fiscal year, the budget office estimated that the deficit hit a record of $415 billion. The deficit was slightly smaller than the most recent Congressional and administration forecasts, mainly because corporate tax revenues shot up by 43 percent as profits climbed at the fastest pace in decades. Personal tax revenues rose by 2 percent.

Republicans have cited the jump in business tax revenues as vindication for the four tax cuts that Mr. Bush has pushed through Congress since he took office.

"The deficit is still too large, but we are moving in the right direction," said Representative Jim Nussle, Republican of Iowa and chairman of the House Budget Committee.

But the four-year budget record is less comforting. Spending, particularly military spending, has climbed rapidly since Mr. Bush took office. Largely because of the war in Iraq, but also because of Pentagon modernization projects, military spending has climbed about 40 percent since 2000 to $437 billion. Military spending climbed 12.3 percent in 2004 alone, faster than Medicare and Medicaid entitlement programs and about three times faster than other discretionary programs....