"How the heck did we only have a budget deficit of $163 billion in the 2007 fiscal year?"
In 2001, President George W. Bush inherited a surplus [from Clinton], with projections by the Congressional Budget Office for ever-increasing surpluses, assuming continuation of the good economy and President Bill Clinton’s policies. But every year starting in 2002, the budget fell into deficit. In January 2009, just before President Obama took office, the budget office projected a $1.2 trillion deficit for 2009 and deficits in subsequent years, based on continuing Mr. Bush’s policies and the effects of recession.
And, we cleverly hid the massively underfunded war in Iraq off the balance sheet and ignored the looming liabilities in Fannie, Freddie, the FDIC, etc. Creative accounting is a Republican speciality as demonstrated by Kenny Boy Lay et al.