The Post tells readers today that the plan of Senate Democrats to prevent the alternative minimum tax from applying to more middle income taxpayers will increase the deficit "which is once again projected to approach record levels." No, the deficit is not approaching record levels. The deficit hit 6.0 percent of GDP in 1983. CBO projects that Bush's 2009 budget (which includes unrealistic spending cuts) will come have a deficit of 2.3 percent of GDP. Add in 2.0 percent of GDP to include borrowing from Social Security and more realistic spending projections and we get 4.3 percent of GDP. That is not close to 6.0 percent. The size of the nominal deficit is meaningless and if the Post reporters don't understand that fact, then they need to train them to do their job.
--Dean Baker
