Obamaâs administration tides up the budget by Zivka Deleva

Obama’s administration decided that the previously set aside funds for bailing out more banks will be used to trim the budget deficit for fiscal 2009 to $1.58 trillion. Polls have shown that the deficit is one of the top concerns of Americans who fear that it could lead to higher taxes and on the other hand the record deficit has made investors nervous and it threatens to thwart Obama’s ambitious agenda to service the healthcare, reform education and make the country less reliant on fossil fuels. According to the officials in the administration the drop in the projected deficit is due to the elimination of $250 billion that had been earmarked for further possible financial rescues. This step has been done after signs have shown that the financial markets are far more stable and consequently there will be no need for the U.S. Congress to bail out more banks. As President Barack Obama states the signs also show that the economy is returning to normal and that his $787 billion stimulus program is working, although any recovery has a long way to go. Officials state that the government’s budget office will announce next week that the deficit this fiscal year would total $1.58 trillion, about $262 billion lower than the deficit forecast in May. The improved deficit forecast may help Obama politically as he tries to overcome opposition from fiscally conservative Democrats and others opposed to the $1 trillion price tag for his healthcare overhaul. But on the other hand, a lower deficit will not encourage investors who are looking for evidence that the United States is controlling spending or generating higher revenues, and all of that due to a healthier economy.

by Zivka Deleva for PocketNews (http://pocketnews.tv)

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