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Budget surplus forecast

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In 1999, the Congressional Budget Office (CBO) projected forecasts of the budget surplus to be somewhere between 2 and 3 percent of GDP in the next ten years. Now, the economy has entered a recession, and the government has pledged to fight a prolonged war on terrorism. How is the forecast likely to change?

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In the early 1990s, the fall of the Soviet empire resulted in a massive decline in defense spending, which continued to fall through most of the 1990s. Adjusted for inflation, defense ...

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