The Truth on the Deficit: The WSJ published a good piece today on what really is going on with the federal deficit, with truth meet perception in a head-on collision. To wit:

...over the past three years the federal deficit has shrunk by 58%. The Congressional Budget Office--not the White House--is estimating that the current year's deficit (for fiscal 2007) will fall to $172 billion.

Now you can cynically say that this is like a store "slashing" already high prices to a level that is merely competitive, but there's more to this story than mere spin:

U.S. federal debt as a share of GDP is falling again (see the top chart nearby). At 37% in 2006 and heading south, the U.S. figure compares to 52% in Germany, 43% in France, and 79% in Japan.

The article correctly notes that debt is one thing, while spending is another. The news here is middling:

From 2001-2005, outlays ballooned by $609 billion, or 33%, and Mr. Bush never did veto a spending bill. By contrast, on current pace his second term outlays will grow by 21%--hardly tightfisted, but a third slower.

Last, and perhaps more surprising to many, including yours truly, is that the % of GDP spent on defense is currently lower than it was under Carter, and well under the peak (in the last 30 years, that is) that Reagan set whilst fighting the indomitable Red Menace:

In fact, Mr. Bush's request would only bring defense outlays to 4.2% of GDP, or about 20% of total federal spending. That compares to 4.7% of GDP even under Jimmy Carter, and 6.2% of GDP in 1986 at the peak of the Reagan defense buildup...[note that under Slick Willie it fell to 3%]

Now mind you, the budget remains unbalanced, and while Bushie projects such balance by 2012, we all know he'll be long gone by then, and such projections (remember the Clinton "surpluses") are largely theatre. Now that the Dems are in charge, however, don't be surprised if he doesn't actually threaten to veto a spending bill -- I won't hold my breath however.