President Barack Obama’s 2013 budget proposal
would add $3.5 trillion to annual deficits through 2022, according to a new Congressional Budget Office report.
The White House said last month the budget would reduce the deficit by $3.2 trillion over the next decade, but the CBO said the president’s budget would raise the deficit $365 billion next year. The discrepancies in the White House and CBO estimates are due to differences in economic assumptions. For example, the CBO estimate assumes the Bush-era tax cuts
will expire at the end of this year.
The CBO also compared the budget to another scenario where Congress and the White House avoid large tax increases and spending cuts, all the Bush-era tax rates are extended, and the alternative minimum tax is adjusted to not affect middle-class taxpayers.
In this version, the president’s budget would reduce the deficit by $4.3 trillion.