Deficit Jam

This has left the impression that Obama's policies hold the main responsibility for the deficits. But it's not true. Obama is inheriting a budget facing a structural deficit--that is, one that bleeds red ink even when the economy is running full tilt--and the deficit is exploding because the economy has cratered.

In fact, Obama's budget, on net, reduces the deficit. In recent years, Congress and the president have relied on a series of budget gimmicks to mask the size of the deficit. For instance, they would assume that certain tax breaks would expire starting a year in the future, but routinely extend them a year at a time. According to the Congressional Budget Office's numbers, Obama's budget--compared to continuing current policies--would make the deficit $900 billion lower over the next decade.

Deficit Jam