via Glenn: The federal deficit is likely to narrow by $100 billion. So a $477 billion forecast is very likely to shrink to $370 billion, or 3.1 percent of gross domestic product. Why? More tax receipts to the government and increased withholdings. Why? More jobs along with wage & salary growth.
Chris Wiegand, an economist at Citigroup Global Markets:
“The message is, there is no way that you can see withheld income taxes rising unless there’s a decisive turn in labor market conditions, including payrolls, hours and compensation.”
All of this comes on the heels of largest economic growth (5.5% average over three quarters) since Reagan’s second term in 1984.
And that, my friends, is “trickle-down” recovery at work. Give the peoples’ money back, they’ll invest it (generating working capital) or they’ll spend it (generating increased economic demand), and the rising tide will raise all boats.
The best part of this news is that the “marriage tax” relief enacted under Bush is up for renewal in the Senate. It was passed overwhelmingly in the house. At this pace, it seems hopeful that the Senate Dems will waffle and support its permanent renewal.
Note: This is a ‘yeah economy’ post, not a political post. Some of you couldn’t get past that and play nice with comments last time, so…comments off. If you’re so inclined, the email link follows….