But the report also said the increase in the deficit would be temporary and would not be passed on to future generations.

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They noted the bill adds to the US budget deficit, while also objecting that the low tax rates - which have the biggest impact on the deficit - are only temporary.

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Numerous analysts previously said they anticipated a temporary correction lower in gold when the deficit-ceiling impasse ended.

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Bush warned that because the war on terrorism and homeland security would cause a budget deficit, Congress would have to "act in a fiscally responsible way" to ensure the deficit would be small and temporary.

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The risk is that the monetary boost will be as temporary as the gains from 20 years of Keynesian deficit spending have proven to be.

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In America the new deficit-focused climate is preventing politicians from passing a temporary (and sensible) fiscal stimulus package without inducing them to tackle the sources of the country's huge medium-term deficit by, for instance, reforming social security.

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For decades, we have piled deficit upon deficit, mortgaging our future and our children's future for the temporary convenience of the present.

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On the flip side, once the Bank of England begins unwinding the quantitative easing programme, the deficit will rise again, so one could see the transfer as a temporary effect.

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There was a deal to be had: keep up spending in the short term, with a stress on much-needed infrastructure investment, as well as extending the temporary tax cuts, in exchange for a big medium-term reduction in the deficit, centred on entitlements and tax reform.

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