Writing in The Wall Street Journal, Jesse Drucker notes($) that the full cost of the recently-passed economic stimulus package is slightly underestimated by the Joint Committee on Taxation's score:

A round of business tax cuts in Congress's economic-stimulus package passed Thursday will cost nearly triple the official government estimate, tax experts said.

The tax breaks in the package will cost more than $22 billion over the next 11 years, or roughly $15 billion more than the government's long-term estimate of $7.5 billion. To put that additional $1.4 billion cost a year into context, it is the same as the annual budget of the federal National Institute of Mental Health.

...

...the U.S. Treasury must borrow to make up for the lost revenue. These interest costs over the next decade will triple the estimated long-term cost of the proposed business tax cuts, according to an analysis done by tax experts at the request of The Wall Street Journal.

And as interest expense on the national debt is the fastest growing component of the federal budget, prominent mention of interest expenses in spending and taxation debates would portray a much clearer picture of the nation's finances. So, we've put together a proposal that would impose a statutory requirement on the Joint Committee on Taxation to include interest expenses in its scorings, with the belief that budgetary decision making would be much improved when legislators have ready access to information on the interest expense of any budgetary legislation.

More reactions and analysis of the president's budget have emerged since our first round-up post on Tuesday:

• CBPP: President's Budget and Medicare "Trigger"
  
• NWLC: Budget Woes: President's FY 2009 Budget
  
• Committee for a Responsible Federal Budget: The President's FY 2009 Budget
  
• The Workforce Alliance: FY 2009 Federal Funding Analyses

There have also been a number of statements and analyses circulated from Capitol Hill:

• Senate Budget Committee Dems: Brief Analysis of Bush FY 2009 Budget
  
• Sen. Conrad (D-ND): Statement on FY 2009 Budget Release
  
• Majority Leader Hoyer (D-MD): Bush's Legacy: Fiscal Meltdown, Weak Economy
  
• House Budget Committee: State-by-State Analysis of President's FY 2009 Budget Request
  
• Speaker Pelosi (D-CA): Statement on President Bush's FY 2009 Budget
  
• Majority Leader Hoyer: Statement on Bush's Release of Another Fiscally Irresponsible Budget
  
• Sen. Gregg (R-NH): Statement on FY 2009 Budget Release
• Senate Budget Committee Repubs: Overview of President's Budget

The federal government incurred a deficit of $90 billion in the first four months of fiscal year 2008, CBO estimates, about $48 billion more than the shortfall in the same period last year. Shifts in the timing of certain payments and receipts account for about one-third of that increase in the deficit.

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The federal government recorded a surplus of $15 billion in January, CBO estimates, less than half the surplus recorded in the same month last year.

Noteworthy is the reason for the uptick in spending: "Spending for net interest on the public debt accounted for the greatest growth, up by about $5 billion (or 30 percent)."

Since the president's FY 2009 budget request was mostly a rehash of old policies and proposals we've already spent time debunking in previous years, we've been looking for some new angles with which to view the president's budget. As I was sitting at my desk looking at the budget books in my office, the actual length of the main budget volume released this year jumped out at me. Or I should say, it didn't jump out at me.

Turns out the main budget book for the FY 2009 budget is the shortest one ever released by the president. At 170 pages, it is more than 45 percent shorter than the average length of the budget book released each year by President Bush (which came in at 311 pages.

Not sure what one can make of this change, particularly since the FY 2008 budget is also much shorter than the Bush average. This particular part of the president's budget proposal has evolved during the Bush administration to be a fancy, glossy, picture-filed advertisement for the administration's achievements and priorities, with little hard budgetary information. It is developed, I suppose, to help the administration put the best spin on their budget proposal and successes.

I wonder if the Bush administration is tired of actively selling their misguided priorities, particularly in this final year and that is the reason for the shorter volume? Or perhaps they have realized they really don't have many budget achievements that they should be bragging about?

Had the president used realistic assumptions about economic growth in 2008, yesterday's headlines covering the FY 2009 budget request would have been: "Record Deficit Projected." Instead, the president chose to use a somewhat optimistic GDP growth rate of 2.7 percent, which produces a higher revenue forecast and subsequently lower deficit of $410 billion. If, on the other hand, the president chose to employ the CBO's numbers (GDP growth of 1.7%), the projected deficit for 2008 would have been a jaw-dropping $426.4 billion, significantly surpassing 2004's $413 billion deficit.

There are, however, mitigating circumstances for the president's numbers. In the economic assumptions section, the analytical perspectives volume states (p171):

The [Administration's economic] assumptions are based on information available as of mid-November 2007 and are close to those of the Congressional Budget Office and a consensus of private-sector forecasters...

But that begs the question: The CBO and Blue Chip (i.e. private-sector forecasters) figures reported in the budget documents (table S-10) are from January, so why not use economic forecasts based on the same set of relevant economic data?

So what were the economic experts saying when OMB were making their assumptions for the FY 2009 budget request? In testimony before Congress on Dec. 5^th, CBO Director Peter Orszag told Congress that the Blue Chip forecast was for 2.4 percent GDP growth in 2008 and that the Federal Reserve Board were predicting growth of 1.8 to 2.5 percent. Applying the administration's economic sensitivity data (p177) - a 1 percentage point reduction in GDP growth results in a $13.8 billion drop in revenue and a $2.6 billion increase in spending - to the Fed's high-end 2.5 percent estimate, the projected deficit would be $413.3 billion in 2008 - a tie for largest nominal deficit.

A budget that predicts a record-high deficit would be terribly inconvenient for a president who wishes to be remembered as "fiscally-responsible."

The day after President Bush released his $3.1 trillion budget for FY 2009, analysts and advocacy groups have begun to roll out reactions and statements on the proposal. Below are a few out so far:

CBPP: Federal Grants to State and Localities Cut Deeply
CBPP: The Dubious Priorities of the President's Budget
FRAC: Statement on Nutrition Program Changes in Budget
NWLC: Bush Budget Locks in Gains for the Rich, Short Changes Women and Families

We'll post more statements and analyses as they are released. OMB Watch's overview of the budget will be released this afternoon in the next edition of The Watcher (Sign up here if you don't receive The Watcher).

The president released his FY 2009 budget this morning. His $3 trillion request is a first, and it comes six years after another historical request - the first $2 trillion request.

Budget of the United States Government: Fiscal Year 2009