February 5, 2008

Bush budget takes economy into account: W.House

WASHINGTON (Reuters) - U.S. President George W. Bush's fiscal 2009 budget proposal released on Monday takes into account that the U.S. economy is facing a slowdown, the White House said.

"The budget takes into account that we're going to see a slowdown in the economy, a temporary one. It takes into account the economic stimulus package we're going to put in place in order to shield against that," White House spokeswoman Dana Perino said when asked whether the administration's economic assumptions were too optimistic, given recent economic data.

The Bush administration on Monday acknowledged that a weaker economy would lead to higher budget deficits, as Bush unveiled a $3.1 trillion spending plan for fiscal year 2009 that would nearly freeze domestic programs.

The proposal forecasts a deficit of $410 billion for the budget year 2008 that ends on September 30 and $407 billion for fiscal 2009 that begins on October 1. Those deficits are more than double the $162 billion gap of 2007 and will approach the $413 billion all-time high for the deficit hit in 2004.

"The president's budget addresses our immediate economic challenges, ensures sustained prosperity, keeps America safe and continues on the road to the president's pledge to get us a surplus by 2012," Perino told reporters.

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