Tax Hikes Loom as Deficit Nears $1T

Blue or red, next president may need to boost revenues with increase
By Ambreen Ali,  Newser Staff
Posted Oct 16, 2008 10:03 AM CDT
Tax Hikes Loom as Deficit Nears $1T
Lawmakers discuss the federal budget with reporters.   (AP Photo)

The bailout and other government spending are adding on to an already-enormous US budget deficit, and the next president might well have to raise taxes, no matter who it is, the Christian Science Monitor reports. This fiscal year will put the US down nearly $1 trillion, one nonpartisan group estimates, raising the possibility that foreign lenders will move away from purchasing US debt.

Government debt doesn’t seem “like such a good bet anymore” to outside investors, says a fiscal watchdog. This year’s deficit is about 7.5% of gross domestic product—the highest percentage since World War II—and adds $8,620 of federal debt per household. “We may well have passed the point where the federal government's total financial hole exceeds the net worth of all Americans,” adds an analyst. (More national debt stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.