Projected Structural Budget Deficit for 2004:  $391 Billion
revised November 18, 2003 (additional links, graphic).  Graphic updated February 1, 2004.

In a technical report released last month, the Congressional Budget Office (CBO) now projects that the cyclically adjusted budget deficit will be $421 billion in 2004, about 3.7 percent of GDP.  The cyclically adjusted budget excludes the impact of economic booms or recessions. 

In another measure, the standardized-budget deficit is now projected to be $391 billion in 2004, about 3.4 percent of GDP.  This not only corrects for the economic cycle but also excludes some other temporary or one-time items that affect the budget.  The standardized-budget deficit can be termed the "structural" budget deficit.

The structural budget deficit is a calculation that is meant to help policymakers understand how much of the actual budget deficit ($374 billion in 2003, roughly $500 billion projected for 2004) is due to cyclical or temporary factors.  Because the structural deficit is now so large, the argument that a return to robust economic growth will "solve" the deficit problem seems a stretch. 

Using CBO's "rules of thumb" Centrists.Org has previously projected the impact of sustained, faster-than-expected economic growth, as shown below.



Links:
Congressional Budget Office The Cyclically Adjusted and Standarized Budgets:  Updated Estimates (October 2003)

Centrists.Org Faster GDP Growth Won't Solve the Budget Problem (September 9, 2003)

For CBO's rules of thumb, see Congressional Budget Office The Economic and Budget Outlook:  Fiscal Years 2004-2013 (January 2003) and that publication's Appendix C How Changes in Assumptions Can Affect Budget Projections

For CBO's current economic outlook and baseline (which Centrists.Org uses in it projections) see Congressional Budget Office The Economic and Budget Outlook:  An Update (August 2003)

Centrists.Org No-BS Long-Term Budget Baseline homepage

Centrists.Org A Preliminary Assessment of CBO's New Budget Projections (revised August 29, 2003)

Centrists.Org No-BS Long-Term Budget Baseline Homepage

Centrists.Org Is the Recovery Finally For Real? (November 3, 2003)