US President George W. Bush forecast the US budget deficit would more than double in 2008 and blamed a softer economy as he unveiled a $3.1 trillion spending plan for fiscal 2009 today that would nearly freeze domestic programs.
The White House projections were immediately criticized by both Democratic and Republican lawmakers who said the numbers may gloss over the full extent of the fiscal deterioration and failed to include the full Iraq and Afghanistan war costs.
With the economy teetering on the brink of a recession, Bush said the deficit would reach $410 billion for the budget year 2008 that ends on September 30th and $407 billion for fiscal 2009 that begins on October 1st.
The budget makes military spending and the Iraq war its centerpiece, proposing a 7.5 per cent increase for the Pentagon to $515 billion.
On top of that Bush also sought another $70 billion for the conflicts in Iraq and Afghanistan but that money is only expected to cover those costs for part of 2009. The administration said it would ask for more Iraq money later.
"The budget protects America and encourages economic growth. Congress needs to pass it," Mr Bush said after meeting with his Cabinet. The grimmer budget outlook will be inherited by the next president, who succeeds Bush in January 2009.
While the near-term deficits are a concern, many budget experts are bracing for much more serious fiscal problems in coming years as the baby boom generation's retirement causes spending on health care and other entitlements to explode.
The blueprint also assumes deep cuts in many popular domestic programs such as highway funds and heating assistance for the poor, in addition to wringing out billions in savings from the Medicare program for the elderly and disabled.
While many - if not most - of the priorities of the Bush budget will be jettisoned by the Democratic-led US Congress, the unveiling of the document is sure to trigger a new round of sparring over Bush's fiscal policies and his economic legacy.
Democrats have hammered Mr Bush for presiding over a shift to deficits after taking office amid budget surpluses, pointing to a jump in the national debt to $9 trillion from about $5.6 trillion when Mr Bush took office in January 2001.