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FROM: http://news.bbc.co.uk/2/hi/business/2946552.stm
29 May 2003
Bush 'buried' Critical
Budget Report
Bush
Wants More Tax Cuts
The Bush administration
reportedly buried a report commissioned by the US Treasury which predicted
a budget deficit of over $44,000bn and called for tax rises.
In a front-page story
Britain's Financial Times said the report, which advocated tax rises,
was left out of February's budget report
as the White House lobbied for $350bn in tax cuts.
Those cuts, the opposite
of what was reportedly recommended
in the Treasury study, were signed into law by President George W Bush
on Wednesday.
The newspaper said the
study was "the most comprehensive assessment of how the
US government is at risk of being overwhelmed by the 'baby boom' generation's
future healthcare and retirement costs".
"It estimates that
closing the gap would require the equivalent
of an immediate and permanent 66% across-the-board income tax increase,"
the FT said.
The Bush administration
has been heavily criticised for the tax cuts - which came on top of
a 10-year $1,650bn in tax cuts in 2001 - as the US economy stagnates
and unemployment rises.
Reports Ignored
The FT reported that
former Treasury Secretary Paul O'Neill, who
was sacked from the administration in December, commissioned
the paper.
Two leading US Treasury
economists headed the study - Kent Smetters, former Treasury deputy
assistant secretary for economic policy, and Jagdessh Gokhale, a Treasury
consultant at the time.
In transcripts of interviews
with them published by the FT, they disagree
over whether the report was meant to be included in the budget report.
Mr Smetters said the
report was "never meant to be a Treasury study. It was meant to
be some internal thinking... on how to reform the budget".
He was contradicted
by Mr Gokhale.
"When we were conducting
the study my impression was that it was slated
to appear (in the budget)," he said.
But Mr Gokhale added
that it had been common practise for US administrations to ignore similar
critical reports over the past decade.
FROM: http://news.bbc.co.uk/2/hi/business/2946552.stm
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