Full text of Mid-Session Review of the Budget : Fiscal Year 1999
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FY 1999 Mid-Session Review TABLE OF CONTENTS Page TABLE OF CONTENTS................................................................................................................................ i LIST OF TABLES.......................................................................................................................................... ii EXECUTIVE SUMMARY ............................................................................................................................. 1 ECONOMIC ASSUMPTIONS....................................................................................................................... 5 RECEIPTS ...................................................................................................................................................... 9 SPENDING..................................................................................................................................................... 11 SUMMARY TABLES ..................................................................................................................................... 15 GENERAL NOTES 1. All years referred to are fiscal years unless otherwise noted. 2. All totals in the text and tables display both on-budget and off-budget spending and receipts unless otherwise noted. 3. Details in the tables and text may not add to totals because of rounding. i LIST OF TABLES Page Table 1.0 Receipts, Outlays, and Surplus................................................................................................... 3 Table 2.0 Economic Assumptions................................................................................................................ 8 Table 3.0 Change in Receipts ...................................................................................................................... 9 Table 4.0 Change in Outlays....................................................................................................................... 13 Table 5.0 Estimated Spending from 1999 Balances of Budget Authority: Discretionary Programs..... 15 Table 6.0 Outlays for Mandatory Programs Under Current Law............................................................ 15 Table 7.0 Mandatory Pay-as-you-go Proposals .......................................................................................... 16 Table 8. Effect of Proposals on Receipts .................................................................................................. 19 Table 9. Budget by Category of Outlays and Receipts: Mid-Session Review Versus February Budget 22 Table 10. Receipts by Source ...................................................................................................................... 23 Table 11. Outlays by Agency....................................................................................................................... 24 Table 12. Outlays by Function.................................................................................................................... 25 Table 13. Discretionary Budget Authority by Agency .............................................................................. 26 Table 14. Discretionary Budget Authority by Function ........................................................................... 27 Table 15. Federal Government Financing and Debt................................................................................. 28 ii EXECUTIVE SUMMARY After five consecutive years of declining deficits, the Federal budget is about to pass another milestone. In fiscal year 1998, marking the sixth consecutive year of improved fiscal balance, and the longest such series in history, the Federal budget will achieve its first surplus in 29 years. The Administration projects that the surplus for 1998 will be $39 billion, the largest surplus in dollar terms in all of U.S. history, and the largest as a percentage of GDP since 1957. Furthermore, the Administration’s projections indicate that this budget surplus could grow over the next four years to $148 billion by fiscal year 2002—part of what would be the longest and largest (by any yardstick) sustained debt reduction in our history. These results are unprecedented, and are the fruits of years of fiscal prudence, conservative economic forecasting, and unwavering discipline—which in turn generated the economic strength of the last five years. Last year’s budget agreement is now putting the finishing touches on the President’s effort to restore the Nation’s fiscal health, begun in 1993, by bringing the era of exploding deficits to an end. In his first budget, submitted in the Administration’s first days in 1993, President Clinton confronted the then-record deficit with a program of budget savings of $505 billion over five years—more than half of which came from spending cuts. The President, with the support of the Congress, saw the plan through to enactment—despite dire predictions that this budget would send the economy into recession, destroy jobs, raise interest rates, and ultimately undermine our fiscal health. The facts tell another story—a story of a virtuous cycle in which deficit reduction caused interest rates to fall, and investment to boom, leading to an unprecedented combination of sustained growth and falling inflation. Some authorities have proclaimed today’s economy as the best ever. Since 1993, spending levels have come in consistently below what this Administration projected. In other words, we have achieved the spending cuts that the President proposed, and more besides. In fact, actual Federal outlays as a percentage of GDP have declined in every year of this Administration. Indeed, actual outlays have constituted a smaller share of the GDP in every year for which this Administration submitted a budget than they were in any year under the two preceding Administrations. There is no doubt that this Administration has controlled the size of Government more effectively than its predecessors. While Government spending cuts have contributed substantially to deficit reduction, strong revenue growth in the last few years has helped enormously, and has occurred without an excessive tax burden. Tax revenues have grown in substantial part because of the unprecedented strength of the economy, caused by the President’s 1993 program. Typical taxpayers are clearly better off as a result. Real wages are growing for the first time in a quarter of a century, the unemployment rate is at its lowest since 1970, and the Federal income and payroll tax burden on the median family is at its lowest in more than 20 years. The stock market has leaped to record levels. And at the same time, the lowest interest rates since the 1960s have helped families to buy new homes and other durables more cheaply. In 1993, the President pledged to cut the deficit in half by 1998; in fact, he eliminated it entirely. Then, in 1997, the President pledged to balance the budget by 2002; in fact, he was able to meet and surpass that goal this year. This fact means that the President’s call in his State of the Union address to save Social Security First has become even more timely. We have solved the structural deficit, and thereby built the necessary groundwork to eliminate the generational deficit that 1 2 MID-SESSION REVIEW remains. Six years ago, the most sanguine observer would have expected the Federal Government today would still be grappling with a serious budget deficit. Instead, we now can—if we so choose—address the watershed issue of Social Security soundness in a timely fashion, and from a position of fiscal strength. Thus, we must maintain the President’s course to save Social Security First, and defer any discussions of using any of the budget surplus for any other purpose until we have saved Social Security for the next century. We must not set our budget and our economy back by another quarter of a century through the fiscal improvidence of dissipating the first budget surplus in so many years. BALANCING THE BUDGET AFTER DECADES OF DEFICITS SURPLUS (+) / DEFICITS (-) IN BILLIONS -1200 $1.1T DEFICIT -1000 -800 PRE-OBRA 1993 BASELINE -600 -400 $74B DEFICIT -200 $290B DEFICIT ACTUALS TOTAL SAVINGS $10.3 TRILLION TOTAL DEFICITS $3.1 TRILLION 0 200 RESERVE PENDING SOCIAL SECURITY REFORM 400 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 RECEIPTS, OUTLAYS, AND SURPLUS (Dollar amounts in billions) 1998 February Budget estimate: Receipts .............................................................................................. Outlays ............................................................................................... Surplus Reserved Pending Social Security Reform ........................ Deficit (–)/Surplus ............................................................................. Mid-Session estimate: Receipts .............................................................................................. Outlays ............................................................................................... Surplus Reserved Pending Social Security Reform ........................ Surplus ............................................................................................... Memorandum: Mid-Session estimates as a percent of GDP: Receipts .......................................................................................... Outlays ........................................................................................... Surplus Reserved Pending Social Security Reform .................... Surplus ........................................................................................... 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1,658 1,668 NA –10 1,743 1,733 10 0 1,794 1,785 9 0 1,863 1,834 28 0 1,949 1,860 90 0 2,028 1,945 83 0 2,123 2,011 111 0 2,227 2,088 139 0 2,329 2,162 167 0 2,444 2,225 219 0 2,566 2,304 261 0 1,704 1,665 39 0 1,784 1,730 54 0 1,835 1,774 61 0 1,902 1,820 83 0 1,990 1,843 148 0 2,072 1,922 150 0 2,170 1,986 184 0 2,272 2,059 213 0 2,375 2,130 245 0 2,490 2,190 300 0 2,609 2,267 342 0 20.4 19.9 0.5 0.0 20.5 19.9 0.6 0.0 20.2 19.6 0.7 0.0 20.1 19.2 0.9 0.0 20.1 18.6 1.5 0.0 20.0 18.6 1.4 0.0 20.0 18.3 1.7 0.0 20.0 18.2 1.9 0.0 20.0 17.9 2.1 0.0 20.0 17.6 2.4 0.0 20.1 17.5 2.6 0.0 EXECUTIVE SUMMARY Table 1. 3 ECONOMIC ASSUMPTIONS Introduction The Nation’s overall economic performance, the best in over a generation, is getting even better. Strong economic growth last year has been followed by even stronger growth so far this year. Job opportunities are plentiful and payrolls continue to expand. The unemployment rate has fallen further this year, dropping to the lowest level in nearly three decades. Despite rapid growth and low unemployment, inflation has declined to rates not seen since the 1960s. The ‘‘Misery Index’’—the sum of the inflation and unemployment rates—is at its lowest level in over 30 years. In this extraordinary economic environment, optimism abounds. Consumer surveys reveal the highest level of confidence in at least three decades. Businesses are confident in the future and are spending heavily on new capacity-augmenting plant and equipment. Investors continue to propel equity markets to record highs. On foreign exchange markets, confidence in the U.S. economy has pushed the value of the dollar to its highest level in nearly a decade. This remarkable performance has been fostered by prudent fiscal and monetary polices. The Omnibus Budget Reconciliation Act of 1993 and last summer’s Balanced Budget Act ended years of growing budget deficits and began an era of surpluses. The budget balance has swung from a $290 billion deficit in 1992 to an estimated $39 billion surplus this year. Based on Administration policies, the surplus would grow to $342 billion by 2008. Monetary policy has succeeded in gradually reducing inflation without sacrificing economic growth. The Federal Reserve has tightened monetary policy when inflationary pressures appeared to be building and relaxed policy when growth and inflationary pressures eased. Since January 1996, monetary policy has been basically unchanged. The sound fiscal and monetary policies now in place, along with the highly favorable economic trends underway, will enable the expansion to extend its outstanding record of sustained growth, strong job creation, low unemployment and low inflation. The expansion that began in April 1991 has just entered its eighth year. By December, it will become the second longest of all time, and the longest in peacetime. If the economy continues to grow through February 2000, as most forecasters anticipate, this expansion will become the longest on record. Recent Developments Real Gross Domestic Product (GDP) expanded at a robust 4.2 percent annual rate in the first quarter, following a 3.7 percent advance during the four quarters of 1997. Growth was led by consumer spending, residential investment, and business investment in equipment, offset to some extent by a decline in Federal Government spending and a significant widening of the net export deficit. The larger foreign sector deficit subtracted nearly two percentage points from first quarter growth, due in part to a sharp decline of exports to Asian countries severely weakened by currency and other crises. The Consumer Price Index (CPI) rose at just a 0.9 percent annual rate during the first four months of this year, down from a 1.7 percent advance during 1997. The GDP chain-weighted price index rose at only a 0.9 percent annual rate in the first quarter, the smallest advance since 1963. This measure, which includes the prices of exports and subtracts the prices of imports, reflects the prices of goods and services produced in the United States but sold anywhere. A better measure of the prices of goods and services we buy is the price index for gross domestic purchases, which includes the prices paid by consumers, businesses and government for all their purchases, whether produced here or abroad. By this measure, for the first time since 1954, there was no inflation at all. Low inflation across a 5 6 MID-SESSION REVIEW wide spectrum of the economy reflects intense competition from both domestic and foreign suppliers. In addition, energy, food and quality-adjusted computer prices fell sharply in the first quarter. During the first four months of this year, the Nation’s payrolls rose by 900,000 jobs. The healthy pace of job creation helped pull the unemployment rate down to 4.3 percent in April, the lowest level since February 1970. The employment-population ratio set a record high this year at 64.2 percent. All demographic groups have benefited from the robust labor market. Unemployment rates for key groups are at the lowest level in a quarter century or more. Despite strong growth, short-term interest rates edged down this year, and long-term rates have remained on a low plateau. The three-month Treasury bill rate was 5.0 percent in mid-May, about 20 basis points lower than in December, while the 30-year Treasury bond yield was just under six percent, close to its December level. Revised Economic Assumptions The economic assumptions underlying the Mid-Session Review are similar to those in the February Budget. The Administration, like most forecasters, expects a moderation in the pace of economic activity beginning with the current quarter. In part, more moderate growth this year is expected to result from a further widening of our net export balance because of the adjustments underway in Asian economies, the rise in the dollar in recent years, and the faster U.S. economic growth relative to that of our trading partners. Beyond this year, the growth moderation reflects the view that at current low levels of unemployment, growth cannot be maintained at its recent rapid pace without creating strong inflationary pressures. This view is consistent with mainstream empirical economic research. Although the economy might perform even better than this, it is prudent to base budget estimates on conservative, conventional assumptions. The Administration’s economic project real GDP to grow 2.0 year for the next three years. following six years, growth is assumptions percent per During the expected to average 2.4 percent per year —the Administration’s estimate of the long-run, sustainable noninflationary growth rate of the economy. Potential GDP growth of 2.4 percent annually can be divided into a 1.3 percent trend growth of productivity and a 1.1 percent trend growth of the labor force. During 1999-2000, potential growth may be 0.1 percentage point faster, in part because welfare reform may boost labor force growth slightly. During 2008, potential growth is projected to be 2.3 percent because of an anticipated slower growth of the workforce as the first wave of the baby-boom generation enters retirement. Real GDP growth of two percent per year is consistent with a gradual rise in the unemployment rate of about one-quarter percentage point per year during the next three years. Beginning in mid-2000, the unemployment rate is projected to remain at 5.4 percent, the Administration’s estimate of the rate consistent with stable inflation. The inflation projection is similar to that of the FY 1999 Budget, although inflation during 1998 has been revised downward to reflect the recent very favorable performance. During the next few years, when the unemployment rate is below 5.4 percent, inflation is projected to creep up gradually to rates that are more typical of the last few years. The GDP chain-weighted price index is projected to rise 2.2 percent during the year 2000 and each year thereafter. The Consumer Price Index is projected to rise 2.3 percent per year beginning in the year 2000. These rates are about one-half percentage point higher than during 1997. The inflation projections incorporate recent and prospective methodological improvements in the measurement of the Consumer Price Index. A very important change that will be instituted beginning in January 1999 is the use of geometric means, rather than arithmetic means, for most lower level aggregation. This improvement is expected to slow the annual growth of the CPI by 0.2 percentage point. The cumulative effect of all the improvements is estimated to result in a 0.7 percentage point slower annual rise in the CPI by 1999 and beyond relative to the methodology in use at the end of 1994. ECONOMIC ASSUMPTIONS (For further details, see Analytical Perspectives, FY 1999 Budget, page 6.) The Administration’s estimate of potential GDP growth incorporates the methodological improvements to the CPI which add a cumulative total of 0.2 percentage point to the growth by 1999. Potential growth is affected by these changes because nominal spending is adjusted for inflation to determine real economic growth. Thus, assuming that nominal spending is held fixed, reductions in measured inflation increase measured real growth. The Mid-Session Review interest rate projection is nearly identical to that of the FY 7 1999 Budget. Short-term interest rates are projected to decline gradually over the forecast horizon. By 2001, the three-month Treasury bill rate is expected to be 4.7 percent, about 30 basis points lower than the rate in mid-May. The 10-year Treasury bond rate is projected to remain at its recent level of 5.6 percent, 10 basis points below the Budget’s projection. On the income side, taxable incomes as a share of GDP are similar to those in the Budget, but the composition has been changed slightly. The share of profits has been scaled back and the share of wages and salaries has been correspondingly increased to reflect recent trends. 8 MID-SESSION REVIEW Table 2. ECONOMIC ASSUMPTIONS 1 (Calendar years; dollar amounts in billions) Actual 1997 Gross Domestic Product (GDP): Levels, dollar amounts in billions: Current dollars ............................................................... Real, chained (1992) dollars .......................................... Chained price index (1992 = 100), annual average ...... Percent change, fourth quarter over fourth quarter: Current dollars ............................................................... Real, chained (1992) dollars .......................................... Chained price index (1992 = 100), annual average ...... Percent change, year over year: Current dollars ............................................................... Real, chained (1992) dollars .......................................... Chained price index (1992 = 100), annual average ...... Projections 1998 1999 2000 2001 2002 2003 8,080 8,456 8,795 9,161 9,559 10,003 10,468 7,189 7,400 7,550 7,701 7,863 8,051 8,245 112.4 114.3 116.5 119.0 121.6 124.3 127.0 5.6 3.7 1.8 4.2 2.4 1.7 4.1 2.0 2.0 4.2 2.0 2.2 4.4 2.2 2.2 4.7 2.4 2.2 4.6 2.4 2.2 5.8 3.8 2.0 4.7 2.9 1.7 4.0 2.0 2.0 4.2 2.0 2.1 4.4 2.1 2.2 4.6 2.4 2.2 4.6 2.4 2.2 Incomes, billions of current dollars: Corporate profits before tax .......................................... Wages and salaries ......................................................... Other taxable income 2 ................................................... 730 728 735 756 786 3,877 4,126 4,295 4,473 4,662 1,782 1,848 1,910 1,969 2,030 824 4,871 2,101 856 5,097 2,181 Consumer Price Index (all urban): 3 Level (1982–84 = 100), annual average ......................... Percent change, fourth quarter over fourth quarter ... Percent change, year over year ..................................... 160.6 163.2 166.5 170.2 174.2 1.9 1.6 2.1 2.3 2.3 2.3 1.6 2.1 2.2 2.3 178.2 2.3 2.3 182.3 2.3 2.3 Unemployment rate, civilian, percent: Fourth quarter level ....................................................... Annual average .............................................................. 4.7 5.0 4.8 4.7 5.0 5.0 5.2 5.2 5.4 5.4 5.4 5.4 5.4 5.4 Federal pay raises, January, percent: Military 4 ......................................................................... Civilian 5 .......................................................................... 3.0 3.0 2.8 2.8 3.1 3.1 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 Interest rates, percent: 91-day Treasury bills 6 ................................................... 10-year Treasury notes .................................................. 5.1 6.4 5.0 5.6 4.9 5.6 4.8 5.6 4.7 5.6 4.7 5.6 4.7 5.6 1 Based on information available as of April 1998. Rent, interest, dividend and proprietor’s components of personal income. CPI for all urban consumers. Two versions of the CPI are published. The index shown here is that currently used, as required by law, in calculating automatic adjustments to individual income tax brackets. Projections reflect scheduled changes in methodology. 4 Beginning with the 1999 increase, percentages apply to basic pay only; adjustments for housing and subsistence allowances will be determined by the Secretary of Defense. 5 Overall average increase, including locality pay adjustments. 6 Average rate (bank discount basis) on new issues within period. 2 3 RECEIPTS The current estimates of receipts for 1998 and 1999 exceed the budget estimates by $45.9 billion and $41.5 billion, respectively. The estimates for subsequent years have been revised upward by similar amounts. These changes result primarily from revised economic projections and technical reestimates. Revised economic projections increase receipts by $10.7 billion in 1998, $16.1 billion in 1999, and $13.7 billion to $15.1 billion in each subsequent year. Higher levels of wages and salaries, partially offset by reductions in non-wage sources of personal income, increase collections of individual income taxes and payroll taxes throughout the forecast period. Lower shares of corporate profits Table 3. in GDP partially offset the increases in individual income taxes and payroll taxes in each year. Higher-than-anticipated collections of individual income taxes account for most of the $35.3 billion technical revision in 1998 receipts. Most of the increase in individual income taxes is higher-than-anticipated withheld and estimated payments of 1998 tax liability, which the Administration believes will lead to higher receipts throughout the forecast period. Also contributing to the technical increase in 1998 receipts are higherthan-anticipated net final settlements of 1997 income tax liability by individuals. CHANGE IN RECEIPTS (In billions of dollars) February estimate .................................. Change since February: Revised economic assumptions .......... Technical reestimates ........................ Administrative action ........................ 1998 1999 2000 2001 2002 2003 1,657.9 1,742.7 1,793.6 1,862.6 1,949.3 2,028.2 10.7 35.3 –0.1 16.1 25.4 –0.1 13.7 27.3 –0.1 14.3 25.5 –0.1 13.9 27.0 –0.1 15.1 28.8 –0.1 73.2 134.1 –0.3 207.0 Total change .................................... 45.9 41.5 41.0 39.7 40.9 43.8 Mid-Session estimate ............................. 1,703.8 1,784.3 1,834.5 1,902.3 1,990.2 2,072.0 1999–2003 9 SPENDING The new estimate of total 1998 outlays is $1,664.7 billion, $3.1 billion lower than the February budget estimate. The reduction arises largely from revised technical assumpions offset by increases enacted in the Supplemental Appropriations and Rescissions Act for 1998. The Adminstration now estimates total outlays for 1999 at $1,730.0 billion, $3.2 billion below the February estimate. Reductions from changed economic assumptions more than offset increases resulting from policy adjustments and revised technical assumptions. Policy changes Policy changes are largely due to the Supplemental Appropriations and Rescissions Act of 1998. The Act provided discretionary funding for Bosnia and Southwest Asia contingency operations and disaster relief. The current estimates also reflect the override of the President’s veto of selected items in the Military Construction Appropriations Act for 1998. Due to policy changes, estimated outlays for 1998 and 1999 are $2.6 billion and $1.9 billion, respectively, higher than in the 1999 Budget. Economic changes Revisions in economic assumptions, discussed earlier in this report, lower estimated outlays by $1.2 billion in 1998, $5.8 billion in 1999, and a total of $45.7 billion from 1999 to 2003. These reductions largely result from downward revisions in inflation and interest rates. In addition, debt service on other changes due to economic assumptions contributes to the lower outlay estimates. Technical changes For 1998, estimated outlays are $4.5 billion lower than in February for technical reasons. For 1999, technical changes increase outlays by $0.8 billion. The following changes in outlay projections all arise from technical factors. Discretionary programs.—Estimated outlays for discretionary programs in 1998 are lower than the budget estimates by $1.6 billion, reflecting lower-than-anticipated actual spending for a number of non-defense programs, including highways and disaster relief. Farm programs.—Spending on farm production programs through the Commodity Credit Corporation is projected to rise by 6 percent in 1998 and 1999, relative to the February budget, but diminish in 2000 through 2002. In 1998, net outlays are now estimated at $0.7 billion above the February estimate. These changes reflect decreased demand for tobacco from tobacco companies and decreased demand for cotton and soybeans resulting in higher near-term price support loan outlays. Deposit insurance.—Net outlays for 1998 for deposit insurance are now projected to be $0.6 billion higher than in February, largely reflecting slower than expected asset recoveries in the Bank Insurance Fund. Estimated 1999 net outlays are $1.4 billion higher than projected in February, largely reflecting a shift in timing of recoveries from certain RTC securitizations. These recoveries, which are recorded in the budget as negative outlays, are now expected to occur in 2000 rather than in 1999. Medicare.—Current estimates of Medicare outlays are higher than the February estimates by $3.1 billion in 1999 for technical reasons. Most of this change reflects corrections to estimates of home health expenditures for both fee-for-service and managed-care coverage. Unemployment insurance.—The revised estimates of unemployment insurance for 1998 are less than the budget estimates by $0.6 billion, reflecting actual experience to date. Food stamps.—Estimated outlays for food stamps are lower than in the budget by $0.7 billion in 1998 and $1.2 billion in 1999, reflecting a downward revision in average participation level and benefit costs. Family support payments.—Actual family support payments to date have been lower than anticipated, resulting from States’ transi11 12 tion out of the repealed AFDC program. This leads to a reduction in estimates of 1998 outlays of $1.2 billion. Earned income tax credit (EITC).—Estimated outlays for EITC are now projected to be $1.0 billion and $1.2 billion higher than in February for 1998 and 1999, respectively. This increase reflects higher calendar year 1997 tax claims in the first several months of the tax season than were anticipated. Social security.—The revised estimates for Social Security are lower than the budget estimates by $2.0 billion in 1998 and $1.2 billion in 1999, reflecting experience to date, including fewer applications than anticipated and lower than anticipated retroactive disability benefits. Federal Communications Commission (FCC) spectrum auctions.—Total receipts for auctions of spectrum to date have exceeded projections in the budget for this year. Because these MID-SESSION REVIEW receipts are recorded as negative outlays, 1998 estimated outlays have been reduced by $0.9 billion. Estimated outlays in 2002 have been increased by $2.3 billion, reflecting lower projections of receipts. This reduction reflects a decision by the FCC on the amount of spectrum available for the analog return auction. Naval Petroleum Reserve (NPR) sale proceeds.—Current estimates reflect a different pattern of actual receipts than assumed in the February estimates. Now that the sale conditions are known, projected receipts shift from 1999 into both 1998 and 2000. Outer Continental Shelf (OCS) receipts.— Estimates in the budget reflected a March, 1998 resolution of Alaska escrow accounts based on a final U.S. Supreme Court decree. Delay in the final decree has shifted the anticipated settlement date into 1999. Receipts including interest on the escrow deposits are now anticipated to be $1.7 billion in 1999. 13 SPENDING Table 4. CHANGE IN OUTLAYS (In billions of dollars) 1999– 2003 1998 1999 2000 2001 2002 2003 February estimate ............................................................... Revisions due to: Policy changes: Discretionary programs ............................................ Debt service ............................................................... 1,667.8 1,733.2 1,785.0 1,834.4 1,859.6 1,945.4 2.5 * 1.7 0.2 1.7 0.3 0.5 0.3 0.1 0.4 * 0.4 4.0 1.6 Subtotal, policy changes ........................................... Economic assumptions: Social security ........................................................... Other mandatory programs ..................................... Net interest: Interest rate .......................................................... Debt service ........................................................... 2.6 1.9 2.0 0.8 0.4 0.4 5.6 –* –1.0 –2.0 –1.4 –2.9 –1.1 –2.8 –1.2 –2.7 –1.0 –2.5 –1.3 –12.9 –5.9 –* –0.1 –1.2 –1.2 –1.9 –2.3 –2.2 –3.4 –2.2 –4.5 –2.2 –5.8 –9.7 –17.2 –1.2 –5.8 –8.1 –9.6 –10.4 –11.8 –45.7 –1.6 0.7 0.6 –0.4 –0.6 –0.7 –1.2 1.0 –2.0 –0.9 –0.4 0.1 –0.8 0.2 0.3 1.4 3.1 0.1 –1.2 –0.1 1.2 –1.2 –0.1 0.7 –0.4 0.5 0.4 –0.3 –1.6 2.4 0.3 –1.4 — 1.2 –1.5 — –0.3 — 1.3 0.5 –0.2 –0.1 2.1 0.3 –1.3 — 1.2 –1.8 0.2 — — 1.1 –* –0.2 –0.2 2.1 0.3 –1.2 — 1.3 –1.9 2.3 — — 1.2 –0.3 0.3 * 2.2 0.3 –1.7 — 1.3 –2.0 –0.8 — — 1.4 0.7 –0.1 –0.5 12.0 1.4 –6.8 –0.1 6.1 –8.4 1.5 0.4 –0.4 5.5 1.1 0.4 –1.2 –2.5 — –5.6 — –8.1 — –10.5 — –12.7 –1.2 –39.4 –4.5 0.8 –5.1 –6.0 –7.0 –11.9 –29.2 –69.4 Subtotal, economic assumptions .............................. Technical reestimates: Discretionary programs ............................................ Farm programs ......................................................... Deposit insurance ..................................................... Medicare .................................................................... Unemployment insurance ........................................ Food stamps .............................................................. Family support payments ........................................ EITC .......................................................................... Social security ........................................................... FCC spectrum auction ............................................. NPR sale proceeds .................................................... OCS receipts (net) .................................................... Other mandatory ...................................................... Net interest: OCS settlement escrow ......................................... Other 1 .................................................................... Subtotal, technical reestimates ................................... Total, changes ........................................................... –3.1 –3.2 –11.2 –14.7 –16.9 –23.4 Mid-Session estimate .......................................................... 1,664.7 1,730.0 1,773.9 1,819.7 1,842.6 1,922.0 Memorandum: Discretionary budget authority: February estimate ........................................................ IMF ............................................................................ Other ......................................................................... 555.4 17.9 3.2 570.6 — 0.1 575.0 — 0.1 582.5 — –0.4 588.6 — –0.4 604.2 — –0.4 Total, change ......................................................... Mid-Session estimate ................................................... 21.1 576.5 0.1 570.7 0.1 575.1 –0.4 582.1 –0.4 588.2 –0.4 603.9 * $50 million or less 1 Includes debt service. — –0.9 –0.9 SUMMARY TABLES Table 5. ESTIMATED SPENDING FROM 1999 BALANCES OF BUDGET AUTHORITY: DISCRETIONARY PROGRAMS 1 (In billions of dollars) Total Total balances, end of 1999 ......................................................... Spending from end of 1999 balances in: 2000 ............................................................................................ 2001 ............................................................................................ 2002 ............................................................................................ 2003 ............................................................................................ Expiring balances, 2000 through 2003 ....................................... Unexpended balances at the end of 2003 ................................... 501.4 240.2 105.0 66.4 46.2 ............ 43.4 1 This table is required by section 221(b) of the Legislative Reorganization Act of 1970. Table 6. OUTLAYS FOR MANDATORY PROGRAMS UNDER CURRENT LAW 1 (In billions of dollars) 1997 Actual Estimate 1998 1999 2000 2001 2002 2003 Human resources programs: Education, training, employment and social services ... Health ............................................................................... Medicare ........................................................................... Income security ................................................................ Social security .................................................................. Veterans’ benefits and services ...................................... 13.7 100.9 187.4 191.4 362.3 20.7 12.8 106.6 195.0 196.0 376.1 24.0 13.7 115.5 207.8 208.7 389.7 24.7 14.3 122.8 216.5 219.0 404.9 26.1 13.7 131.8 232.0 227.2 422.4 27.8 12.9 141.5 234.3 233.8 442.2 32.5 15.0 152.5 255.3 242.3 462.8 34.0 Subtotal, human resources programs ......................... 876.5 910.4 960.0 1,003.5 1,054.8 1,097.1 1,161.9 Other mandatory programs: International affairs ........................................................ Energy .............................................................................. Agriculture ....................................................................... Commerce and housing credit ........................................ Transportation ................................................................. Undistributed offsetting receipts .................................... Other functions ................................................................ –3.8 –3.4 5.0 –17.6 2.3 –50.0 –* –4.3 –2.8 7.1 0.4 2.4 –48.0 1.7 –4.1 –4.6 7.4 2.4 2.2 –42.4 1.0 –3.8 –3.3 6.5 5.8 2.2 –44.3 1.0 –3.6 –3.3 5.3 8.4 1.9 –47.4 0.9 –3.4 –3.3 5.3 8.4 1.2 –54.2 0.6 –3.2 –3.3 5.9 8.0 1.8 –48.6 0.6 Subtotal, other mandatory functions .......................... –67.5 –43.4 –38.1 –35.9 –37.8 –45.4 –38.7 Total, outlays for mandatory programs under current law .................................................................. 809.0 867.0 921.9 967.6 1,016.9 1,051.7 1,123.2 * $50 million or less. 1 This table is required by Section 221(b) of the Legislative Reorganizations Act of 1970. 15 16 MID-SESSION REVIEW Table 7. MANDATORY PAY-AS-YOU-GO PROPOSALS (Deficit impact in millions of dollars) Estimate 1998 Spending: Agriculture: Food stamps: Restrict States’ ability to increase Federal outlays by shifting administrative costs from TANF to food stamps and medicaid (food stamps component) ...... ............ Restore benefits for vulnerable groups of legal immigrants (food stamps component) ............................... 100 Subtotal, Food Stamps .............................................. Shift certain crop insurance spending to mandatory ..... Limit ‘‘catastrophic’’ crop insurance payments to $100,000 ......................................................................... Increase Environmental Quality Incentive Program (EQIP) ............................................................................. Forest Service payments to States (‘‘delinking from receipts’’) ............................................................................ Rural EZ/EC economic development grants for Round II ..................................................................................... Restructure Export Enhancement Program (EEP) consistent with market conditions ..................................... Restructure CCC cotton user marketing certificates consistent with market conditions ............................... Spend existing and new Forest Service recreation and entrance fees .................................................................. Education: Fund new teachers to help address teacher shortages and reduce class sizes ................................................... Student loan increases .................................................... Recall education loan guaranty reserves ........................ Other student loan reforms ............................................. Health and Human Services: Establish Early Learning Fund to provide challenge grants to communities for activities that improve early childhood education and the quality and safety of child care for children under five years old ............ Increase child care subsidies provided to poor and near poor families .......................................................... Medicaid: Restore benefits for vulnerable groups of legal immigrants (medicaid component) .................................... Children’s health outreach ........................................... Restrict States’ ability to increase Federal outlays by shifting administrative costs from TANF to food stamps and medicaid (medicaid component) ........... Medicaid effect from Medicare changes ....................... 1999 2000 2001 2002 Total 1999–2003 2003 –160 –185 –190 –195 –200 –930 535 500 455 460 480 2,430 375 185 315 123 265 118 265 127 280 137 1,500 690 ............ .............. –15 –30 –30 –30 –105 100 ............ ............ 13 49 70 59 52 243 ............ 10 22 30 41 48 151 ............ .............. 7 16 19 19 61 –359 –258 –258 –270 –1,375 –48 .............. .............. .............. –158 ............ –230 ............ –110 ............ .............. 3 3 3 3 12 ............ 55 312 312 ............ .............. –470 –451 780 519 –275 –804 1,195 627 –275 –864 1,440 739 –275 –805 1,632 861 –275 –710 5,102 3,058 –1,100 –3,634 ............ 372 504 591 600 600 2,667 ............ 798 1,102 1,301 1,519 1,892 6,612 ............ ............ 25 110 35 150 50 210 55 210 65 220 230 900 ............ ............ –340 –5 –360 –5 –380 –10 –410 –10 –440 –10 –1,930 –40 ............ –210 –180 –130 –155 –165 –840 ............ 20 20 20 20 20 100 ............ 34 34 34 25 25 153 ............ ............ 101 –180 387 –420 363 –515 343 –600 339 –665 1,533 –2,380 Subtotal, net effect on Medicare trust funds ........... ............ Clinical cancer trials demonstration ........................... ............ –79 200 –33 250 –152 –257 –326 300 .............. .............. –847 750 Subtotal, Medicare/clinical demonstration ............... ............ Child Suport Enforcement: Repeal hold harmless provision .................................... ............ 121 217 148 –257 –326 –97 –40 –48 –57 –58 –56 –259 Subtotal, Medicaid ..................................................... Health care: Voluntary purchasing cooperatives for small groups Increase aid to territories for children’s health insurance ............................................................................. Medicare/clinical demonstration: Medicare buy-in policies ................................................ Medicare program integrity .......................................... 17 SUMMARY TABLES Table 7. MANDATORY PAY-AS-YOU-GO PROPOSALS—Continued (Deficit impact in millions of dollars) Estimate 1998 Conform paternity testing match rate to administrative match rate ........................................................... ............ Subtotal, Child Support Enforcement ...................... Housing and Urban Development: Fund new Urban Empowerment Zones ....................... Increase FHA single family loan limit ......................... Interior: BLM payments to States (‘‘delinking from receipts’’) Spend existing and new recreation and entrance fees Spend existing and new park concession fees 1 ......... Reduce Sport Fish Restoration (offsets increase in DOT Boat Safety account) ......................................... Expand cover-over of distilled spirits tax to Virgin Islands ......................................................................... Labor: Reauthorize NAFTA-TAA for five years ...................... Other TAA amendments .............................................. PBGC—raise guarantee cap for multiemployer pensions and other ........................................................... UI ‘‘safety net’’ proposal: UI administrative costs special distribution .......... Extended benefits ...................................................... Transportation: Shift St. Lawrence Seaway spending to mandatory ... Shift Coast Guard Boat Safety spending to mandatory (partially offset by reductions in Sport Fish Restoration) ................................................................ NEXTEA equity formula change for distribution of Federal-aid grants to States ..................................... Treasury: Expand cover-over of distilled spirits tax to Puerto Rico .............................................................................. Shift Winstar/FIRREA litigation expenses to mandatory (reimbursement to Department of Justice) ...... EITC and Child Credit (outlay component) ............... Miscellaneous activities authorized in tobacco legislation ........................................................................... Veterans: Pay full benefits for Filipinos residing in the U.S. .... Establish a reserve to fully fund the ‘‘H’’ policyholders in the National Service Life Insurance Fund ............................................................................ Reinstate policy on post-service tobacco-related illnesses .......................................................................... Provide a one-time 20% increase in the Montgomery GI Bill and provide $100 million a year until 2003 to increase education and training programs administered by the Department of Labor .................. VA Housing: Charge fees to lenders participating in VA’s home loan program to fund information technology improvements: Increased technology spending ................................. Fees ............................................................................. Eliminate the vendee loan program ........................... Environmental Protection Agency: Provide funding for Superfund orphan shares ............ Social Security Administration: Expand authority to collect SSI overpayments ........... Adjust discretionary caps to fund SSI non-disability redeterminations ........................................................ 1999 2000 2001 2002 Total 1999–2003 2003 –8 –8 –8 –8 –9 –41 ............ –48 –56 –65 –66 –65 –300 ............ ............ 3 –228 54 –241 123 –234 143 –233 149 –237 472 –1,173 ............ 6 ............ .............. ............ 5 7 –21 10 12 33 15 14 79 16 17 79 14 56 170 60 ............ .............. –3 –6 –10 –14 –33 ............ 12 12 12 12 12 60 ............ ............ 27 67 45 88 52 97 53 97 55 97 232 446 ............ 1 1 1 3 4 10 ............ 126 101 ............ .............. .............. 188 9 236 .............. 9 8 651 26 ............ 13 13 13 14 14 67 ............ 24 42 55 55 55 231 25 53 36 –9 –53 –83 –56 ............ 34 34 34 34 34 170 10 ............ 45 –70 49 –105 43 –106 36 –108 29 –111 202 –500 ............ 3,425 3,943 4,582 4,972 5,362 22,284 ............ 5 5 5 5 5 25 ............ * * * * * 2 ............ –741 –1,330 –2,291 –6,274 –6,333 –16,969 ............ 291 291 309 306 305 1,502 ............ ............ ............ 5 –5 –2 5 –5 –9 5 .............. .............. –5 .............. .............. –9 –11 –12 15 –15 –43 ............ 200 200 200 200 200 1,000 ............ –35 –40 –35 –30 –30 –170 ............ 46 4 .............. .............. .............. 50 18 MID-SESSION REVIEW Table 7. MANDATORY PAY-AS-YOU-GO PROPOSALS—Continued (Deficit impact in millions of dollars) Estimate 1998 Return to work pilot for recipients of disability benefits (SSI): ............................................................. District of Columbia: Make annual contribution to the DC Judicial Retirement Fund mandatory ............................................... Federal Deposit Insurance Corporation (FDIC): State bank examination fee (Non-Fed member state banks) .......................................................................... Railroad Retirement Board: Conforming Social Security Equivalent Benefits to Social Security ............................................................ 1999 2000 2001 2002 Total 1999–2003 2003 ............ –4 –4 –4 –3 –3 –18 ............ 6 6 6 6 6 30 ............ –89 –94 –97 –101 –106 –487 ............ 32 48 49 49 49 227 Subtotal, pay-as-you-go spending proposals ............ –23 Receipts: Provide new incentives ......................................................... 459 Eliminate unwarranted benefits ......................................... –323 Receipts from tobacco legislation ......................................... ............ Superfund initiative ............................................................. –75 All other ................................................................................. ............ 4,498 5,100 5,843 2,527 3,293 21,261 3,220 5,125 5,469 4,987 5,378 –4,342 –4,289 –4,725 –4,699 –4,959 –9,795 –11,787 –13,283 –14,544 –16,085 –1,775 –1,407 –1,410 –1,421 –1,434 –73 –2,147 –2,521 –2,565 –1,339 24,179 –23,014 –65,494 –7,447 –8,645 61 –12,765 –14,505 –16,470 –18,242 –18,439 –80,421 38 –8,267 –59,160 ............ –2 Subtotal, pay-as-you-go receipt proposals ....................... TOTAL, pay-as-you-go proposals ............................ ADDENDUM: Proposals not subject to pay-as-you-go: Spending: HUD: Equity share relaxation ............................................ Interior: Utah mitigation receipts ........................................... Labor: Special benefits ......................................................... UI integrity ............................................................... Social Security Administration: Savings from SSI non-disability redetermination .. Interactive effect of Medicare initiatives ................. Return to work pilot for recipients of disability benefits (DI): ........................................................... FDIC: Migration of Fed and FDIC retirees and certain active employees to FEHBP (FDIC component) .. Morris K. Udall Scholarship Fund: End of receipt of Federal payments to the fund, which are extended in the baseline but not proposed for continuation ............................................ Undistributed offsetting receipts: Adjust timing of BBA–97 spectrum receipts .......... Employer share impact of FERS ‘‘open season’’ repeal .......................................................................... Subtotal, non-pay-as-you-go spending proposals Receipts: Repeal FERS open season (will score as discretionary) ....................................................................... Total, proposals not subject to pay-as-you-go 1 ............ –9,405 –10,627 –15,715 –15,146 –1 –2 .............. .............. –5 1 .............. .............. .............. .............. 1 ............ ............ –13 –118 –29 –160 –31 –160 –16 –160 46 –160 –43 –758 ............ ............ –105 20 –120 107 –8 136 –4 144 –3 138 –240 545 ............ .............. –5 1 7 13 16 –14 –15 –17 –19 –78 ............ .............. .............. .............. .............. 2 2 –6 –13 ............ .............. –1,800 500 1,300 .............. ................ 3 93 113 119 125 171 621 –3 –137 –1,909 540 1,379 188 61 –6 –167 –201 –212 –224 –232 –1,036 –9 –304 –2,110 328 1,155 –44 –975 Includes shift of existing fees from miscellaneous receipts recorded in the Department of the Treasury to special fund receipts in the Department of the Interior. 19 SUMMARY TABLES Table 8. EFFECT OF PROPOSALS ON RECEIPTS (In millions of dollars) Estimate 1998 Provide tax relief and extend expiring provisions: Make child care more affordable: Increase and simplify child and dependent care tax credit ........ ............ Establish tax credit for employer-provided child care ................ ............ Subtotal, make child care more affordable .............................. Promote energy efficiency and improve the environment: Provide tax credit for energy-efficient building equipment ........ Provide tax credit for the purchase of new energy-efficient homes .......................................................................................... Provide tax credit for high-fuel-economy vehicles ....................... Equalize treatment of parking and transit benefits ................... Provide investment tax credit for CHP systems ......................... Provide tax credit for replacement of certain circuitbreaker equipment ................................................................................... Provide tax credit for certain PFC and HFC recycling equipment ............................................................................................ Provide tax credit for rooftop solar equipment ............................ Extend wind and biomass tax credit ............................................ 1999 2000 2001 2002 2003 Total 1999– 2003 –266 –1,259 –1,148 –1,199 –1,241 –38 –77 –108 –124 –131 –5,113 –478 ............ –304 –1,336 –1,256 –1,323 –1,372 –5,591 ............ –123 –223 –283 –341 –409 –1,379 ............ –7 –23 ............ ............ ............ ............ –4 –11 10 –270 –281 –38 –60 –16 –113 –54 –200 –23 –95 –75 –400 –30 –183 –197 –660 –84 –942 ............ –3 –9 –11 –8 –5 –36 ............ ............ ............ –3 –6 –5 –7 –16 –20 –7 –24 –38 –6 –31 –55 –3 –43 –73 –26 –120 –191 Subtotal, promote energy efficiency and improve the environment ................................................................................... 10 –421 –590 –590 –813 –1,221 –3,635 Promote expanded retirement savings ............................................ –42 –139 –191 –205 –190 –190 –915 Expand education incentives: Provide incentives for public school construction ........................ ............ –215 –865 –1,309 –1,309 –1,309 –5,007 Extend and expand exclusion for employer-provided educational assistance ...................................................................... –10 –234 –299 –408 –98 ............ –1,039 Eliminate tax when forgiving student loans subject to income contingent repayment ................................................................ ............ ............ ............ ............ ............ ............ .............. Subtotal, expand education incentives ..................................... Increase low-income housing tax credit per capita cap .................. Extend expiring provisions: Extend work opportunity tax credit ............................................. Extend welfare-to-work tax credit ................................................ Extend R&E tax credit .................................................................. Extend deduction provided for contributions of appreciated stock to private foundations ...................................................... Make permanent the expensing of brownfields remediation costs ............................................................................................. Subtotal, extend expiring provisions ........................................ Modify international trade provisions: Extend GSP and modify other trade provisions 1 ........................ Extend and modify Puerto Rico economic-activity tax credit ..... Levy tariff on certain textiles and apparel products produced in the CNMI 1 ............................................................................. Expand Virgin Island tariff credits 1 ............................................ –10 ............ –449 –1,164 –1,717 –1,407 –1,309 –45 –167 –306 –448 –593 –6,046 –1,559 –5 ............ –365 –206 –11 –802 –40 –17 –49 –778 –169 –1,844 ............ –40 –27 ............ ............ ............ –67 –279 –53 –608 ............ ............ ............ –181 –51 –261 –72 –37 –124 –133 –205 –196 –534 –967 –626 –438 –302 –3,392 –548 –42 –477 –79 –485 –124 –18 –165 –19 –197 –1,547 –607 ............ ............ ............ ............ 187 –* 187 –* 187 –2 187 –1 748 –3 –370 –1,059 ............ ............ Subtotal, modify international trade provisions 1 .................... ............ Provide other tax incentives: Expand tax incentives for SSBICs ............................................... –* Accelerate and expand start-up of incentives available to two new empowerment zones ........................................................... ............ Make first $2,000 of severance pay exempt from income tax .... ............ –590 –369 –422 2 –30 –1,409 –* –* –* –* –* –* –19 ............ ............ ............ –169 –174 –180 –185 –63 –750 Subtotal, provide other tax incentives ...................................... Simplify the tax laws ........................................................................ –86 –126 –188 –142 –813 –631 –* –47 –44 –42 –174 –138 –180 –136 –185 –89 20 MID-SESSION REVIEW Table 8. EFFECT OF PROPOSALS ON RECEIPTS—Continued (In millions of dollars) Estimate 1998 1999 Enhance taxpayers’ rights ................................................................ ............ Subtotal, provide tax relief and extend expiring provisions 1 ......................................................................................... Eliminate unwarranted benefits and adopt other revenue measures: Defer deduction for interest and OID on convertible debt ............. Eliminate dividends-received deduction for certain preferred stock ................................................................................................ Repeal percentage depletion for non-fuel minerals mined on Federal and formerly Federal lands. .................................................. Repeal tax-free conversions of large C corporations to S corporations ................................................................................................ Replace sales-source rules with activity-based rules ...................... Modify rules relating to foreign oil and gas extraction income ..... Repeal lower-of-cost-or-market inventory accounting method ....... Increase penalties for failure to file correct information returns.. Tighten the substantial understatement penalty for large corporations ......................................................................................... Repeal exemption for withholding on gambling winnings from bingo and keno in excess of $5,000 .............................................. Reinstate oil spill excise tax 1 ........................................................... Modify Federal Unemployment Act provisions ............................... Extend pro-rata disallowance of tax-exempt interest expense that applies to banks to all financial intermediaries .................. Increase proration percentage for P&C insurance companies ....... Preclude certain taxpayers from prematurely claiming losses from receivables ............................................................................. Restrict special net operating loss carryback rules for specified liability losses ................................................................................. Freeze grandfather status of stapled (or ‘‘paired-share’’) REITs ... Restrict impermissible business indirectly conducted by REITs ... Modify treatment of closely held REITs .......................................... Modify depreciation method for tax-exempt use property ............. Impose excise tax on purchase of structured settlements 1 ........... Clarify and expand math-error procedures ..................................... Clarify the meaning of ‘‘subject to’’ liabilities under section 357(c) ............................................................................................... Simplify foster child definition under EITC .................................... Clarify tie-breaker rule under EITC ................................................ Eliminate non-business valuation discounts ................................... Eliminate ‘‘Crummey’’ rule ............................................................... Eliminate gift tax exemption for personal residence trusts ........... Include QTIP trust assets in surviving spouse’s estate ................. Apply 7.7% capitalization rate to credit life insurance premiums Modify corporate-owned life insurance (COLI) rules ...................... Modify reserve rules for annuity contracts ..................................... Tax certain exchanges of insurance contracts and reallocations of assets within variable insurance contracts .................................. Reduce ‘‘investment in the contract’’ for mortality and expense charges on certain insurance contracts ........................................ Amend 80/20 company rules ............................................................. Prescribe regulatory directive to address tax avoidance involving foreign built-in losses ..................................................................... Prescribe regulatory directive to address tax avoidance through use of hybrids ................................................................................. –1 2000 –11 2001 –35 2002 –54 2003 –87 Total 1999– 2003 –188 –459 –3,220 –5,125 –5,469 –4,987 –5,378 –24,179 2 10 22 34 44 54 164 3 10 20 30 41 53 154 ............ 92 94 96 97 99 478 ............ ............ ............ 16 ............ 1 580 5 407 6 13 1,356 62 507 12 31 1,456 102 417 15 44 1,545 107 237 19 55 1,634 112 79 13 144 6,571 388 1,647 65 ............ ............ 25 42 43 37 147 ............ 17 4 1 1 1 24 34 238 241 243 248 251 1,221 ............ ............ ............ ............ ............ ............ .............. 4 –16 10 43 17 55 22 76 26 96 30 126 105 396 ............ 416 57 62 65 68 668 ............ 3 ............ ............ ............ ............ ............ 12 9 1 29 1 10 48 21 17 2 12 5 14 67 22 25 4 16 11 18 69 24 35 5 18 16 19 70 25 46 7 19 22 21 72 104 132 19 94 55 82 326 4 10 ............ ............ ............ * ............ ............ ............ ............ ............ –1 ............ ............ 6 22 251 409 ............ 1,815 16 6 * 232 20 –1 2 34 414 674 23 6 * 242 21 1 2 32 434 821 30 6 * 260 22 7 2 21 460 639 37 6 * 274 24 19 2 10 487 692 116 24 * 1,008 87 25 8 119 2,204 4,641 2 37 95 168 259 368 927 ............ 13 1 36 2 48 11 49 28 51 58 52 100 236 ............ 30 51 52 54 56 243 ............ 27 54 54 44 34 213 21 SUMMARY TABLES Table 8. EFFECT OF PROPOSALS ON RECEIPTS—Continued (In millions of dollars) Estimate 1998 Modify foreign office material participation exception applicable to inventory sales attributable to nonresident’s U.S. office ....... 1 Stop abuse of CFC exception to ownership requirements .............. ............ Subtotal, eliminate unwarranted benefits and adopt other revenue measures 1 ..................................................... Other provisions that affect receipts: Reinstate environmental tax imposed on corporate taxable income 2 .............................................................................................. Reinstate Superfund excise taxes 1 .................................................. Extend excise taxes on gasoline, diesel fuel and special motor fuels 1 ............................................................................................... Convert airport and airway trust fund taxes to a cost-based user fee system 1 ..................................................................................... Receipts from tobacco legislation ..................................................... Assess fees for examination of bank holding companies and State-chartered member banks (receipt effect) 1 ......................... Transfer retirees and certain active employees of the FDIC and Board of Governors of the Federal Reserve to FEHBP (receipt effect) .............................................................................................. Repeal FERS open season (receipt effect) ....................................... Create solvency incentive for State unemployment trust fund accounts 1 ............................................................................................ Subtotal, other provisions that affect receipts 1 ................ Total effect of proposals 1 1999 2000 2001 2002 2003 Total 1999– 2003 7 4 10 9 10 7 11 5 11 5 49 30 323 4,342 4,289 4,725 4,699 4,959 23,014 ............ 75 1,074 701 696 711 690 720 690 731 691 743 3,841 3,606 ............ ............ 371 382 391 403 1,547 ............ ............ 1,700 1,700 1,700 850 ............ 9,795 11,787 13,283 14,544 16,085 5,950 65,494 ............ 72 75 78 81 85 391 ............ 6 1 167 1 201 1 212 1 224 1 232 5 1,036 ............ ............ ............ 360 392 ............ 752 81 11,810 15,542 17,426 18,754 19,090 82,622 ......................................................... –55 12,932 14,706 16,682 18,466 18,671 81,457 (Paygo proposals) 1 ................................................................. (Non-paygo proposals) ........................................................... –61 12,765 14,505 16,470 18,242 18,439 6 167 201 212 224 232 80,421 1,036 * $500,000 or less. 1 Net of income offsets. 2 Net of deductibility for income tax purposes. 22 MID-SESSION REVIEW Table 9. BUDGET BY CATEGORY OF OUTLAYS AND RECEIPTS: MID-SESSION REVIEW VERSUS FEBRUARY BUDGET (In billions of dollars) 1998 1999 2000 1999 Budget Policy (February estimate) Outlays: Discretionary: Defense .................................................................... 265.1 266.5 269.7 Nondefense ............................................................. 287.6 299.7 304.1 2001 2002 2003 270.8 304.4 273.1 303.6 289.5 305.8 Subtotal, discretionary ........................................... Mandatory: Social security ........................................................ Medicare ................................................................. Medicaid .................................................................. Other ....................................................................... 552.7 566.2 573.8 575.1 576.8 595.3 378.1 195.4 101.0 198.0 392.9 204.6 107.7 220.0 409.3 214.2 114.8 236.4 427.1 229.9 123.4 245.2 447.0 232.2 132.6 243.8 467.5 253.1 143.1 265.8 Subtotal, mandatory .............................................. Net interest ................................................................ 872.4 242.7 925.2 241.8 974.7 236.5 1,025.7 233.6 1,055.6 227.1 1,129.5 220.6 Total outlays .............................................................. 1,667.8 1,733.2 1,785.0 1,834.4 1,859.6 1,945.4 Receipts .......................................................................... Surplus Reserved Pending Social Security Reform .... 1,657.9 NA 1,742.7 9.5 1,793.6 8.5 1,862.6 28.2 1,949.3 89.7 2,028.2 82.8 Surplus/deficit (–) .......................................................... On-budget surplus/deficit (–) .................................... Off-budget surplus ..................................................... –10.0 –106.3 96.3 0.0 –95.7 105.3 0.0 –104.9 113.5 0.0 –94.1 122.3 0.0 –44.6 134.4 0.0 –62.8 145.5 Mid-Session Review Policy Outlays: Discretionary: Defense .................................................................... 267.1 268.7 Nondefense ............................................................. 286.5 299.4 270.3 305.7 270.9 305.2 273.2 303.6 289.5 305.5 Subtotal, discretionary ........................................... Mandatory: Social security ........................................................ Medicare ................................................................. Medicaid .................................................................. Other ....................................................................... 553.6 568.1 576.0 576.1 576.8 595.0 376.1 195.0 101.3 194.7 389.7 207.7 108.1 220.7 405.0 216.5 115.1 234.2 422.5 231.8 123.6 245.4 442.4 234.0 132.7 246.5 463.0 254.9 143.2 265.6 Subtotal, mandatory .............................................. Net interest ................................................................ 867.0 244.1 926.2 235.7 970.8 227.0 1,023.3 220.3 1,055.5 210.3 1,126.7 200.3 Total outlays .............................................................. 1,664.7 1,730.0 1,773.9 1,819.7 1,842.6 1,922.0 Receipts .......................................................................... Surplus Reserved Pending Social Security Reform .... 1,703.8 39.1 1,784.3 54.2 1,834.5 60.7 1,902.3 82.7 1,990.2 147.6 2,072.0 150.0 Surplus/deficit (–) .......................................................... On-budget surplus/deficit (–) .................................... Off-budget surplus ..................................................... 0.0 –63.1 102.2 0.0 –59.3 113.5 0.0 –62.1 122.8 0.0 –48.3 131.0 0.0 5.8 141.7 0.0 –2.4 152.3 RECEIPTS BY SOURCE (In billions of dollars) 1997 actual Individual income taxes ............ Corporation income taxes .......... Social insurance and retirement receipts ..................................... On-budget ................................. Off-budget ................................. Excise taxes ................................ Estate and gift taxes .................. Customs duties ........................... Miscellaneous receipts ............... February estimates Mid-Session estimates 1998 1999 2000 2001 2002 2003 1998 1999 2000 2001 2002 2003 737.5 182.3 767.8 190.8 791.5 198.0 804.6 202.9 833.4 209.2 877.1 214.7 915.5 220.4 810.5 187.7 832.6 187.0 846.2 190.6 874.3 198.1 917.2 207.2 955.8 216.3 539.4 (147.4) (392.0) 56.9 19.8 17.9 25.5 571.4 (155.4) (416.0) 55.5 20.4 18.4 33.5 595.9 (161.8) (434.1) 72.0 20.5 18.2 46.7 623.0 (169.1) (453.9) 69.6 21.6 19.5 52.2 649.0 (176.3) (472.7) 71.6 22.6 20.4 56.4 677.8 (183.5) (494.3) 74.0 24.4 22.4 59.0 706.5 (189.9) (516.6) 74.6 25.6 24.0 61.4 575.4 (155.5) (419.8) 55.6 23.1 17.9 33.6 602.5 (162.9) (439.6) 72.6 24.2 18.2 47.1 628.7 (169.7) (459.0) 70.4 25.5 20.5 52.6 652.9 (176.1) (476.7) 72.3 26.6 21.4 56.8 679.8 (183.0) (496.9) 74.6 28.6 23.4 59.4 707.9 (189.3) (518.6) 75.2 29.8 25.1 61.8 SUMMARY TABLES Table 10. Total ......................................... 1,579.3 1,657.9 1,742.7 1,793.6 1,862.6 1,949.3 2,028.2 1,703.8 1,784.3 1,834.5 1,902.3 1,990.2 2,072.0 On-budget ............................. (1,187.3) (1,241.9) (1,308.6) (1,339.7) (1,389.9) (1,455.0) (1,511.5) (1,284.0) (1,344.6) (1,375.5) (1,425.6) (1,493.3) (1,553.3) Off-budget ............................. (392.0) (416.0) (434.1) (453.9) (472.7) (494.3) (516.6) (419.8) (439.6) (459.0) (476.7) (496.9) (518.6) 23 24 Table 11. OUTLAYS BY AGENCY (In billions of dollars) 1997 actual February estimates 1998 Legislative Branch ............................................... 2.4 2.9 Judicial Branch .................................................... 3.3 3.7 Agriculture ............................................................ 52.5 55.0 Commerce ............................................................. 3.8 4.1 Defense—Military ................................................ 258.3 251.4 Education .............................................................. 30.0 30.7 Energy ................................................................... 14.5 14.4 Health and Human Services ............................... 339.5 359.1 Housing and Urban Development ...................... 27.5 31.0 Interior .................................................................. 6.7 7.9 Justice ................................................................... 14.3 15.5 Labor ..................................................................... 30.5 32.1 State ...................................................................... 5.2 5.3 Transportation ...................................................... 39.8 40.5 Treasury ................................................................ 379.3 387.2 Veterans Affairs ................................................... 39.3 43.1 Corps of Engineers ............................................... 3.6 4.1 Other Defense Civil Programs ............................ 30.3 31.5 Environmental Protection Agency ...................... 6.2 6.4 Executive Office of the President ....................... 0.2 0.2 Federal Emergency Management Agency .......... 3.3 3.7 General Services Administration ........................ 1.1 0.9 International Assistance Programs .................... 10.1 9.6 National Aeronautics and Space Administration ...................................................................... 14.4 13.7 National Science Foundation .............................. 3.1 3.2 Office of Personnel Management ........................ 45.4 46.4 Small Business Administration .......................... 0.3 –0.1 Social Security Administration ........................... 393.3 410.5 Other Independent Agencies ............................... –2.1 14.0 Allowances ............................................................ .............. .............. Undistributed Offsetting Receipts ...................... –155.0 –160.2 2.8 4.0 54.3 4.6 252.6 33.9 15.2 380.8 31.6 7.9 18.2 36.0 5.3 41.3 399.2 43.2 3.5 32.4 7.1 0.3 3.1 0.2 9.5 2000 2.9 4.0 56.4 6.0 255.8 36.2 15.2 401.0 31.9 8.2 18.5 38.0 5.4 42.2 402.3 43.9 3.4 33.4 7.4 0.2 2.2 0.2 10.2 2001 2.9 4.1 56.6 4.1 257.1 36.8 14.9 427.7 31.4 8.2 19.2 39.3 5.5 42.8 407.9 44.7 3.3 34.3 7.4 0.2 1.5 0.2 10.0 2002 2.9 4.3 58.0 3.9 259.7 36.5 14.4 441.4 30.8 7.9 18.2 40.1 5.5 43.5 410.8 45.4 3.3 35.1 7.3 0.2 1.1 –0.5 10.2 2003 3.0 4.4 60.3 3.9 275.8 37.8 14.6 476.0 29.5 8.1 17.9 41.8 5.5 44.4 414.4 47.4 3.3 36.0 7.3 0.2 0.6 0.1 10.2 1998 2.9 3.7 54.8 4.1 253.4 30.7 14.6 357.5 30.2 8.0 15.5 30.6 5.3 40.4 388.8 43.1 4.2 31.5 6.4 0.2 3.2 0.9 9.6 13.5 13.3 13.1 13.3 13.4 13.7 3.4 3.7 3.9 4.0 4.1 3.2 48.6 50.8 53.0 54.6 57.8 46.4 –0.4 –0.3 0.7 0.7 0.7 –0.1 425.7 442.9 461.7 482.4 503.9 408.2 13.7 21.8 22.5 21.9 22.1 14.4 3.2 .............. .............. .............. .............. .............. –161.6 –172.0 –180.9 –197.5 –199.1 –160.6 1999 2.8 4.0 53.3 4.6 254.8 33.9 15.2 384.2 31.8 7.9 18.3 35.2 5.8 41.6 395.7 43.2 3.5 32.4 7.1 0.3 3.7 0.2 9.5 2000 2.9 4.0 54.4 6.0 256.4 36.2 15.2 403.6 32.0 8.2 18.7 38.7 5.8 42.6 394.6 43.9 3.4 33.4 7.4 0.2 3.0 0.2 10.2 2001 2.9 4.1 54.9 4.1 257.3 36.8 14.9 429.8 31.4 8.2 19.4 39.8 5.5 43.2 397.0 44.7 3.3 34.3 7.4 0.2 2.1 0.2 10.0 2002 2.9 4.3 56.4 3.9 259.8 36.5 14.4 443.3 30.8 7.9 18.4 40.9 5.5 43.7 397.0 45.4 3.3 35.1 7.3 0.2 1.1 –0.5 10.2 2003 3.0 4.4 58.5 3.9 275.8 37.8 14.6 478.0 29.3 8.1 18.0 42.4 5.5 44.5 397.4 47.4 3.3 36.0 7.3 0.2 0.6 0.1 10.2 13.5 13.4 13.1 13.3 13.4 3.4 3.7 3.9 4.0 4.1 48.4 50.4 52.7 54.2 57.4 –0.4 –0.3 0.7 0.7 0.7 422.2 438.2 456.7 477.5 499.0 15.1 20.2 22.4 21.6 22.2 1.4 .............. .............. .............. .............. –162.6 –172.8 –181.6 –196.4 –201.3 1,601.2 1,667.8 1,733.2 1,785.0 1,834.4 1,859.6 1,945.4 1,664.7 1,730.0 1,773.9 1,819.7 1,842.6 1,922.0 MID-SESSION REVIEW Total ................................................................... 1999 Mid-Session estimates OUTLAYS BY FUNCTION (In billions of dollars) 1997 actual National defense ........................ International affairs .................. General science, space, and technology ................................. Energy ......................................... Natural resources and environment .......................................... Agriculture .................................. Commerce and housing credit ... Transportation ........................... Community and regional development ...................................... Education, training, employment, and social services ........ Health ......................................... Medicare ..................................... Income security .......................... Social Security ............................ Veterans benefits and services Administration of justice ........... General government .................. Net interest ................................ Allowances .................................. Undistributed offsetting receipts ......................................... February estimates Mid-Session estimates 1998 1999 2000 2001 2002 2003 1998 1999 2000 2001 2002 2003 270.5 15.2 264.1 14.5 265.5 14.5 268.7 15.3 269.8 15.4 272.1 15.7 288.5 15.7 266.1 14.7 267.6 15.0 269.3 15.7 269.9 15.4 272.2 15.7 288.5 15.7 17.2 1.5 17.1 0.4 17.6 –1.0 18.2 0.2 18.4 –* 18.8 –0.2 18.9 –0.1 17.1 0.6 17.6 –1.0 18.2 0.2 18.4 –* 18.8 –0.2 18.9 –0.1 21.4 9.0 –14.6 40.8 23.8 10.6 3.5 41.5 23.2 11.0 3.5 42.3 23.9 10.5 11.8 43.1 23.8 9.2 10.9 43.4 23.2 9.1 10.9 43.6 23.5 9.3 10.2 45.0 24.0 11.3 3.6 41.5 23.2 11.4 4.9 42.6 23.8 10.3 10.2 43.5 23.8 9.0 10.8 43.9 23.2 9.0 10.6 43.9 23.5 9.5 10.2 45.1 11.0 11.8 10.9 10.1 9.7 8.5 7.6 10.9 11.7 11.1 10.4 8.6 7.6 53.0 55.1 123.8 131.8 190.0 198.1 230.9 239.3 365.3 381.5 39.3 43.1 20.2 22.3 12.8 12.9 244.0 242.7 ............... ............... –50.0 –46.4 59.5 141.5 207.3 252.8 396.2 43.3 25.5 17.2 241.8 3.2 –42.5 62.5 63.3 63.4 65.5 54.6 149.9 160.1 170.7 183.5 131.8 216.9 232.6 234.9 255.8 197.7 263.3 271.6 277.9 287.3 236.8 412.6 430.4 450.2 470.7 379.5 44.0 44.8 45.4 47.5 43.1 25.9 26.6 25.8 25.7 22.3 17.5 17.9 17.9 18.5 12.9 236.5 233.6 227.1 220.6 244.1 ............... ............... ............... ............... ............... –45.8 –47.2 –55.5 –48.3 –48.0 59.3 141.9 210.3 251.5 393.0 43.3 25.6 17.2 235.7 1.4 –42.3 SUMMARY TABLES Table 12. 63.1 63.4 63.4 65.5 150.2 160.3 170.8 183.6 219.1 234.5 236.7 257.6 262.4 271.1 277.7 286.3 408.3 425.7 445.6 466.2 44.0 44.8 45.4 47.5 26.1 26.8 26.0 25.8 17.5 17.9 18.0 18.6 227.0 220.3 210.3 200.3 ............... ............... ............... ............... –46.0 –46.7 –52.8 –48.4 Total ......................................... 1,601.2 1,667.8 1,733.2 1,785.0 1,834.4 1,859.6 1,945.4 1,664.7 1,730.0 1,773.9 1,819.7 1,842.6 1,922.0 On-budget ............................. (1,290.6) (1,348.1) (1,404.4) (1,444.6) (1,484.0) (1,499.6) (1,574.3) (1,347.1) (1,403.9) (1,437.6) (1,473.9) (1,487.5) (1,555.7) Off-budget ............................. (310.6) (319.7) (328.9) (340.4) (350.4) (360.0) (371.1) (317.6) (326.1) (336.3) (345.7) (355.1) (366.3) * $50 million or less. 25 26 Table 13. DISCRETIONARY BUDGET AUTHORITY BY AGENCY (In billions of dollars) Agency 1997 Actual February estimates 1998 1999 2000 2001 Mid-Session estimates 2002 2003 1998 1999 2000 2001 2002 2003 Legislative Branch ............................................... 2.2 2.3 2.5 2.5 2.6 2.6 2.7 2.3 2.5 2.5 2.6 2.6 2.7 Judicial Branch .................................................... 3.0 3.2 3.5 3.6 3.8 3.9 4.0 3.2 3.5 3.6 3.8 3.9 4.0 Agriculture ............................................................ 15.7 15.6 15.2 15.2 15.2 15.3 15.3 15.9 15.2 15.2 15.2 15.3 15.3 Commerce ............................................................. 3.8 4.2 4.9 6.1 4.0 3.9 3.9 4.2 4.9 6.1 4.0 3.9 3.9 Defense—Military ................................................ 254.0 256.1 258.4 264.1 272.3 275.5 285.2 259.2 260.3 264.1 272.3 275.5 285.2 Education .............................................................. 26.3 29.4 31.2 31.4 31.5 31.2 31.1 29.4 31.2 31.4 31.5 31.2 31.1 Energy ................................................................... 16.5 16.5 18.0 17.4 17.0 17.2 17.5 16.7 18.0 17.4 17.0 17.2 17.5 Health and Human Services ............................... 34.4 36.9 38.5 39.7 40.7 42.1 44.2 36.9 38.5 39.7 40.7 42.1 44.2 Housing and Urban Development ...................... 16.4 24.6 25.0 28.1 28.7 29.8 31.1 22.2 24.7 27.7 28.4 29.5 30.8 Interior .................................................................. 7.3 8.0 7.9 8.1 8.1 8.1 8.1 8.1 7.9 8.1 8.1 8.1 8.1 Justice ................................................................... 16.4 17.3 18.1 17.0 16.7 16.6 16.9 17.3 18.1 17.0 16.7 16.6 16.9 Labor ..................................................................... 10.2 10.7 11.1 11.0 11.0 11.0 11.1 10.7 11.1 11.0 11.0 11.0 11.1 State ...................................................................... 4.8 4.7 5.1 4.8 4.9 4.9 4.9 4.7 5.5 5.3 4.9 4.9 4.9 Transportation ...................................................... 37.8 40.4 41.1 41.6 41.9 42.4 43.0 40.7 41.1 41.6 41.9 42.4 43.0 Treasury ................................................................ 10.6 11.5 12.3 11.5 11.5 11.5 11.5 11.5 12.3 11.5 11.5 11.5 11.5 Veterans Affairs ................................................... 18.9 18.9 18.9 18.9 18.9 18.9 19.5 18.9 18.9 18.9 18.9 18.9 19.5 Corps of Engineers ............................................... 4.1 4.1 3.2 3.5 3.3 3.3 3.4 4.2 3.2 3.5 3.3 3.3 3.4 Other Defense Civil Programs ............................ 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 Environmental Protection Agency ...................... 6.8 7.4 7.8 6.9 6.9 7.0 7.1 7.4 7.8 6.9 6.9 7.0 7.1 Executive Office of the President ....................... 0.2 0.2 0.3 0.2 0.2 0.2 0.2 0.2 0.3 0.2 0.2 0.2 0.2 Federal Emergency Management Agency .......... 5.1 0.8 0.8 0.8 0.8 0.8 0.8 2.4 0.8 0.8 0.8 0.8 0.8 General Services Administration ........................ 0.6 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 International Assistance Programs .................... 10.6 11.6 12.2 11.5 11.2 11.0 11.0 29.5 12.2 11.5 11.2 11.0 11.0 National Aeronautics and Space Administration ...................................................................... 13.7 13.6 13.5 13.3 13.3 13.4 13.4 13.6 13.5 13.3 13.3 13.4 13.4 National Science Foundation .............................. 3.3 3.4 3.8 3.9 4.0 4.1 4.2 3.4 3.8 3.9 4.0 4.1 4.2 Office of Personnel Management ........................ 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 0.2 Small Business Administration .......................... 0.9 0.8 0.7 0.7 0.7 0.7 0.7 0.8 0.7 0.7 0.7 0.7 0.7 Social Security Administration ........................... 5.6 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 5.5 Other Independent Agencies ............................... 6.7 7.0 7.4 7.3 7.4 7.2 7.2 7.1 7.4 7.3 7.4 7.2 7.2 Allowances ............................................................ .............. .............. 3.2 .............. .............. .............. .............. .............. 1.4 .............. .............. .............. .............. Undistributed Offsetting Receipts ...................... .............. .............. .............. .............. .............. .............. .............. * .............. .............. .............. .............. .............. * $50 million or less. 536.3 555.4 570.6 575.0 582.5 588.6 604.2 576.5 570.7 575.1 582.1 588.2 603.9 MID-SESSION REVIEW Total ................................................................... DISCRETIONARY BUDGET AUTHORITY BY FUNCTION (In billions of dollars) 1997 actual February estimates 1998 1999 2000 2001 Mid-Session estimates 2002 2003 1998 1999 2000 2001 2002 2003 National defense .................................................. 266.2 268.6 271.6 277.0 284.8 288.1 298.0 271.7 273.5 277.0 284.8 288.1 298.0 International affairs ............................................ 18.2 19.0 20.2 19.2 18.9 18.8 18.8 37.0 20.6 19.7 18.9 18.8 18.8 General science, space, and technology .............. 16.6 17.9 18.5 18.5 18.7 19.0 19.1 17.9 18.5 18.5 18.7 19.0 19.1 Energy ................................................................... 4.2 2.8 3.5 3.2 3.1 3.0 3.0 3.0 3.5 3.2 3.1 3.0 3.0 Natural resources and environment ................... 22.4 23.2 22.6 22.3 22.0 22.0 22.3 23.5 22.6 22.3 22.0 22.0 22.3 Agriculture ............................................................ 4.2 4.3 4.1 3.9 3.9 3.9 3.8 4.4 4.1 3.9 3.9 3.9 3.8 Commerce and housing credit ............................. 2.8 3.2 3.3 5.1 2.9 2.9 2.9 3.1 3.0 4.7 2.6 2.5 2.5 Transportation ...................................................... 38.7 41.4 41.8 42.3 42.6 43.1 43.7 41.7 41.8 42.3 42.6 43.1 43.7 Community and regional development .............. 13.0 8.7 9.2 8.0 7.8 7.7 7.8 10.3 9.2 8.0 7.8 7.7 7.8 Education, training, employment, and social services ............................................................... 42.5 46.4 48.6 49.1 49.4 49.3 48.9 46.4 48.6 49.1 49.4 49.3 48.9 Health ................................................................... 25.1 26.4 27.5 28.3 29.2 30.5 33.0 26.4 27.5 28.3 29.2 30.5 33.0 Medicare ............................................................... 2.6 2.7 2.6 2.6 2.6 2.6 2.7 2.7 2.6 2.6 2.6 2.6 2.7 Income security .................................................... 22.7 31.9 33.0 36.7 37.8 39.0 40.3 29.6 33.0 36.7 37.8 39.0 40.3 Social Security ...................................................... 3.5 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 3.2 Veterans benefits and services ........................... 18.9 19.0 18.9 18.9 18.9 18.9 19.6 19.0 18.9 18.9 18.9 18.9 19.6 Administration of justice ..................................... 22.9 24.2 25.7 24.6 24.4 24.6 25.1 24.2 25.7 24.6 24.4 24.6 25.1 General government ............................................ 11.8 12.5 13.0 12.1 12.2 12.0 12.1 12.5 13.0 12.1 12.2 12.0 12.1 Allowances ............................................................ .............. .............. 3.2 .............. .............. .............. .............. .............. 1.4 .............. .............. .............. .............. Undistributed offsetting receipts ........................ .............. .............. .............. .............. .............. .............. .............. * .............. .............. .............. .............. .............. Total ................................................................... 536.3 555.4 570.6 575.0 582.5 588.6 604.2 576.5 570.7 575.1 582.1 588.2 SUMMARY TABLES Table 14. 603.9 * $50 million or less. 27 28 MID-SESSION REVIEW Table 15. FEDERAL GOVERNMENT FINANCING AND DEBT 1 (In billions of dollars) 1997 Actual Financing: Surplus or deficit (–) ............................................ (On-budget) ....................................................... (Off-budget) ....................................................... Means of financing other than borrowing from the public: Changes in: 2 Treasury operating cash balance ................. Checks outstanding, etc. 3 ............................ Deposit fund balances .................................. Seigniorage on coins ......................................... Less: Net financing disbursements: Direct loan financing accounts .................... Guaranteed loan financing accounts ........... Estimates 1998 1999 2000 2001 2002 2003 –21.9 –103.3 81.4 39.1 –63.1 102.2 54.2 –59.3 113.5 60.7 –62.1 122.8 82.7 –48.3 131.0 147.6 5.8 141.7 150.0 –2.4 152.3 0.6 4.0 –0.4 0.5 3.6 –2.8 * 0.4 — –4.5 –1.7 0.7 — — — 0.7 — — — 0.7 — — — 0.7 — — — 0.7 –21.0 0.1 –15.0 –0.9 –15.4 –0.7 –13.2 –0.5 –15.4 –0.1 –14.1 –0.1 –13.4 –0.1 Total, means of financing other than borrowing from the public .......................... –16.2 –14.7 –21.6 –13.0 –14.8 –13.5 –12.8 Total, requirement for borrowing from the public ............................................ Change in debt held by the public ...................... –38.2 38.2 24.4 –24.4 32.6 –32.6 47.7 –47.7 67.9 –67.9 134.0 –134.0 137.2 –137.2 Debt Outstanding, End of Year: Gross Federal debt: Debt issued by Treasury .................................. Debt issued by other agencies ......................... 5,336.5 33.2 5,473.1 29.1 5,632.5 28.0 5,769.3 27.1 5,888.8 26.0 5,965.3 24.9 6,041.1 22.8 Total, gross Federal debt .............................. Held by: Government accounts ....................................... The public ......................................................... Federal Reserve Banks ................................. Other .............................................................. 5,369.7 5,502.1 5,660.5 5,796.4 5,914.8 5,990.2 6,063.9 1,598.6 3,771.1 424.5 3,346.6 1,755.4 3,746.7 1,946.3 3,714.1 2,129.9 3,666.4 2,316.2 3,598.5 2,525.8 3,464.5 2,736.6 3,327.3 Debt Subject to Statutory Limitation, End of Year: Debt issued by Treasury ...................................... Less: Treasury debt not subject to limitation 4 .. Agency debt subject to limitation ....................... Adjustment for discount and premium 5 ............ 5,336.5 –15.5 0.1 6.6 5,473.1 –15.5 0.1 6.6 5,632.5 –15.5 0.1 6.6 5,769.3 –15.5 0.1 6.6 5,888.8 –15.5 0.1 6.6 5,965.3 –15.5 0.1 6.6 6,041.1 –15.5 0.1 6.6 Total, debt subject to statutory limitation 6 ... 5,327.6 5,464.2 5,623.6 5,760.4 5,879.9 5,956.4 6,032.2 * $50 million or less. 1 Treasury securities held by the public and zero-coupon bonds held by Government accounts are almost entirely measured at sales price plus amortized discount or less amortized premium. Agency debt is almost entirely measured at face value. Treasury securities in the Government account series are measured at face value less unrealized discount (if any). 2 A decrease in the Treasury operating cash balance (which is an asset) is a means of financing the deficit and therefore has a positive sign. An increase in checks outstanding or deposit fund balances (which are liabilities) would also be a means of financing the deficit and therefore also have a positive sign. 3 Besides checks outstanding, includes accrued interest payable on Treasury debt, miscellaneous liability accounts, allocations of special drawing rights, and, as an offset, cash and monetary assets other than the Treasury operating cash balance, miscellaneous asset accounts, and profit on sale of gold. 4 Consists primarily of Federal Financing Bank debt. 5 Consists of unamortized discount (less premium) on public issues of Treasury notes and bonds (other than zero-coupon bonds) and unrealized discount on Government account series securities. 6 The statutory debt limit is $5,950 billion.
@FedFRASER