WASHINGTON -- The Congressional Budget Office is projecting this election-year's federal deficit will reach a record $422 billion, congressional aides said yesterday, a smaller shortfall than analysts predicted earlier this year.
The figure, provided by aides who spoke on condition of anonymity, is sure to provide political fodder for both parties during the remaining two months of the presidential and congressional campaigns.
''This is by far the biggest deficit in American history," said Thomas Kahn, Democratic staff director of the House Budget Committee. ''There is no credible way Republicans can portray the record deficits they have created as good news."
But Sean Spicer, Republican spokesman for the committee, said: ''Deficits are going down, jobs are going up, the economy continues to improve. I don't see how you can't be happy with that news."
The number was being released later yesterday in the annual summertime forecast issued by the nonpartisan Congressional Budget Office.
The projection by Congress's nonpartisan budget analysts would surpass last year's $375 billion shortfall, the current record.
The Budget Office report also said next year's deficit would shrink to $348 billion, which would be the third largest ever in dollar terms. That would be $15 billion less than it projected last March, but $17 billion higher than the White House estimated in July.
Yesterday's Budget Office estimate should prove fairly accurate because the federal budget year, which runs through Sept. 30, has less than a month to go. But it does not include the $2 billion in aid for repairing hurricane damage in Florida that President Bush requested Monday.
The government is expected to spend $2.3 trillion this year, which means it will be borrowing about one of every five dollars it spends.
The $422 billion projection for 2004 echoed a preliminary estimate the budget office made last month. It was an improvement from its $477 billion forecast in January, a revision the office attributed mostly to stronger than anticipated revenue collections.
Just last month, the White House forecast a $445 billion deficit for this year, though administration officials acknowledged the figure could be too high because of overestimates for spending.
After a fleeting four-year return to annual budget surpluses under President Clinton, deficits have returned under Bush.
Republicans who spent the 1980s and 1990s railing against shortfalls have argued that fighting wars in Iraq and Afghanistan, battling terrorism, and righting the economy are higher priorities.
They also argue that today's deficits are no reason for panic because as a percentage of the overall economy, they are smaller than the largest shortfalls under President Reagan. Many economists consider that ratio the most significant measure of the harm deficits can cause.
Democrats say the shortfalls are forcing policy makers to restrain spending for schools, domestic security, and other priorities, while driving up the government's borrowing costs. They say deficits have worsened because of the price tag of the tax cuts that Bush and his GOP allies have pushed through Congress.
Most analysts agree the budget picture will worsen considerably within a decade. That is when the huge baby boom generation will begin relying increasingly on Social Security and Medicare, driving those programs' costs upward.