John Sarbanes: “I want to bring one other fact to your attention, and then I will certainly yield back to the Senator. Just to show you…”

“I want to bring one other fact to your attention, and then I will certainly yield back to the Senator. Just to show you how fragile these budget surplus estimates are, in 1995 CBO estimated that in the year 2000 we would have a deficit of $342 billion. Five years out they were making that projection. Instead, we had a surplus of $236 billion, because we restrained ourselves on spending. We recouped taxes in order to balance the budget. That is a swing of $578 billion from the projections to the actuality. That was only projecting 5 years. Now we are talking about projections that go for 10 years. I think the Senator is absolutely right to underscore the fragile nature, which would be the best way to put it, of budget projections. These projections have almost an evaporating dimension to them. I think we have to be extremely careful, cautious, and prudent in planning our policy if we are using these kinds of projections. Of course, the Senator just underscored it, by outlining the projections that were made in the Reagan years to support the tax cut and how far from the mark they were, only a few years later--not quite immediately, but only a few years later.”