Full text of Budget in Brief : Fiscal Year 1957

View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

mm
F ISC A L Y E A R

Executive Office
of the President
B U R E A U OF TH E BU D G ET

¿ e g
ê >

T J

The Budget Dollar

FRB RESEARCH LIBRARY

3 5001 00071 291 6

The Federal Budget in Brief 1957

We will continue to give the tax
payer greater and greater value for
each dollar spent. We will continue
to ioster orderly growth of our econ
omy through sound fiscal policies.
The confidence in the future among
consumers and businessmen gen
erated by those policies must be
maintained.
The success of our country depends
not upon centralized Government con
trol, but upon the efforts of all our
people to do more for themselves, to
better themselves, their families, and
communities. The role of Govern
ment is to encourage these efforts.
D w igh t D. E ise n h o w e r .

From the Budget Message
January 16,1956
1

Introduction

The Budget of the United States is a com
prehensive plan of action proposed by the
President for meeting our national objec
tives. It affects every phase of the life and
activity of the Nation.
The budget is necessarily a large and
complex document. Therefore, the Budget
in Brief is issued each year to present the
important facts about the budget in a sim
pler form.
By law, the budget must be transmitted to
the Congress annually within 15 days from
the date on which Congress convenes. It
presents the President’s program for the
ensuing fiscal year—the year beginning the
following July 1. Thus, the budget for the
fiscal year beginning July 1,1956, and end
ing June 30, 1957, was sent to the Congress
by President Eisenhower on January 16,
1956. This issue of the Budget in Brief
deals particularly with that budget—the
budget for the fiscal year 1957.
The estimates which appear in the budget
represent the best judgment at this time of
the financial results of the President’s rec
ommendations for the fiscal year ending 18
months later. Undoubtedly there will be
many changes before the final figures are in
for the year. The estimates have to be
based on assumptions concerning interna
tional and domestic conditions which may
not actually develop. The Congress may
modify the President’s proposals on taxes
and appropriations. Also, wherever possi
ble and justified, the administration will
make additional economies during the year
which cannot yet be pinpointed in the
budget estimates.

Contents
Part 1. Budget S u m m ary ...................................................................

Pagre
5

Summary of the 1957 b u d g e t................................................................
Budget expenditures................................................................................
Budget receipts.........................................................................................
New authority to incur obligations ......................................................
Unexpended balances of appropriations............................................
New obligational authority and budget expenditures by agency . .
Glossary of selected budget te r m s ............................................ ...

6
7
10
12
13
14
15

Part 2 . Budget Expenditures by F u n c tio n ...................................

Major national secu rity.........................................................................
International affairs and finan ce.........................................................
Veterans’ services and benefits............................................................
Labor and w elfare...................................................................................
Agriculture and agricultural resources......................... ......................
Natural resources...................................................................................
Commerce and h o u sin g...................................................... ..................
General government................................................................................
In terest......................................................................................................

18
20
22
24
26
28
30
32
34

Part 3. Supplem entary In fo r m a tio n .............................................

Gross and net budget expenditures by ag en cy ...................................
Trust fu n d s...............................................................................................
Receipts from and payments to the p u b lic .........................................
Public d e b t................... ............................................................................
Federal public w o rk s...............................................................................
Research and development......................................................................
Federal aid to State and local governments.........................................
Federal credit programs . ......................................................................
Historical tables :
Detail of budget expenditures by function, 1952-1957 .............
Budget receipts and expenditures and public debt, 1915-1957 .
Budget expenditures by function, 1948-1957 .............................

38
40
42
43
44
46
48
50

52
54
54
3

Budget Summary

Part 1 Budget Summary

This opening section of the Federal
Budget in Brief summarizes the key
totals in the budget for the fiscal year
1957—expenditures, receipts, the sur
plus applied to debt reduction, new
authority to incur obligations, and
unexpended balances of appropria
tions.

Summary of the 1957 Budget
The budget proposed by the
President for the fiscal year 1957
is a balanced budget.

Current estimates also indicate
that the budget will be in balance
for the fiscal year ending June
30, 1956.
The significance of the projec
tion of two balanced budgets in a
row is highlighted by the fact that
in only 3 of the past 25 years has
the Federal budget actually been
in balance.
The present encouraging budg

etary outlook for the fiscal years
1956 and 1957 results from a fa
vorable combination of factors in
volving both expenditures and
receipts. Substantial reductions in
Government expenditures have
been achieved during the past 3
years. Revenues are currently ris
ing as the result of the unprece
dented prosperity in the Nation.
Although balanced, the budgets
for 1956 and 1957 have only slim
margins of estimated surplus.
Therefore, the utmost cooperation
will be needed between the execu
tive and legislative branches of
the Federal Government to prevent
increases in expenditures or reduc
tions in receipts that would create
budget deficits.
Since the prospective balance in
the budget for 1957 is a balance at
a high level of receipts and ex

SUMMARY BUDGET INFORMATION
[Fiscal years. In billions]
1954
1952
actual

1953
actual

Budget expenditures____ 365.4
Budget receipts_____ __ 61.4

Description

1957
esti
mated

1955
actual

1956
esti
mated

367.8
64.7

364.6
60.4

364.3
64.5

365.9
66.3

Budget
docu
ment 1

Actual

374.3
64.8

377.9
68.0

Budget deficit ( —) or
surplus ( + ) _______

- 4 .0

-9 .4

-9 .9

-3 .1

- 4 .2

+ .2

+ .4

New authority to incur
obligations________

91.4

80.3

71.8

62.8

57.1

62.0

66.3

1 Reference is to 1954 budget document of Jan. 9, 1953, as presented to the Congress by the outgoing
administration.

penditures, efforts to obtain more
economies in Government opera
tions must continue. The search
for additional savings that can be

effected while strengthening our
security posture and providing es
sential Government services must
be relentless.

Budget Expenditures
In the fiscal year 1956, budget
expenditures are being reduced for
the third successive year. While
they are estimated to rise somewhat
in 1957, the increase is more than
offset by the rise in budget receipts
anticipated from continued growth
in the national economy.
By analyzing budget expendi
tures from several different points
of view, we can get a clear idea of
their content and overall signifi
cance. Accordingly, in Part 1 of
this booklet, expenditures are
first summarized in terms of a
few broad purposes, then in terms
of their controllability through the
budget process, and finally in terms
of the agencies which spend the
money. In Part 2, expenditures
are discussed from still another
point of view—the major functions
or programs of the Government.

Expenditures by purpose .—
When we look at budget expendi
tures according to their broad pur
poses, we find that the greatest
portion of total expenditures in the
fiscal year 1957, 64 percent, is for
protection against possible aggres
sion and for strengthening our in
ternational alliances. The next
largest part, 21 percent, is devoted
to civil benefits. Interest, largely
on the public debt, accounts for

nearly 11 percent. Expenditures
for civil operations and adminis
tration are estimated at 4 percent
of the total. The chart below
shows these expenditures in dollars,
excluding a reserve for contingen
cies of .2 billion dollars.
Protection, including collective
security.—This category consists
mainly of the major national se
curity programs discussed on page
18, and also includes economic
and technical assistance under the
Mutual Security Program, over
seas information activities, civil
defense, and selective service.
The Government will continue
its efforts to seek all possible ways
of making further progress toward
the attainment of a just and lasting
peace. Pending agreement on a
Civil

BHhon*

$2.2
Interest

$ 7.1
Civil Benefits

Protection
t ja j

113.»

Fiscal Year 1957 Eitimaled
7

plan of disarmament that can be
verified by adequate inspection,
the 1957 budget calls for a steady
strengthening of the defenses of
the United States and of its allies.
Expenditures for the military
functions of the Department of De
fense will increase in 1957. Spe
cial emphasis will be placed on
new types of weapons and equip
ment. Outlays for conventional
weapons and for the stockpiling of
strategic and critical materials will
be decreased. Expenditures for
atomic energy will rise in 1957 to
a somewhat higher total than for
any previous year. Increases are
also estimated for the Mutual Se
curity Program and for our foreign
information activities.
Civil benefits.—Expenditures for
civil benefits are designed to en
courage the private development
and growth of our economy and to
provide economic safeguards for
certain individuals and groups.

Some benefits and services are in
the form of civil public works or
loans which add to Federal assets.
Others—such as health research
and grants to States to aid the con
struction of highways, airports,
and schools—also lay the basis for
future economic progress and de
velopment. The bulk of the budg
et expenditures in this category are
for items yielding current benefits
to various groups, including serv
ices and benefits to veterans; aids
to agriculture ; grants to States for
public assistance and for admin
istration of employment offices and
unemployment insurance ; and aids
and subsidies to shipping, airlines,
and the postal service.
The 1957 budget provides for
some new and expanded programs
for meeting a number of growing
domestic needs and for enhancing
opportunities for human well-being and economic growth. Ex
amples are new measures to assist

BUDGET EXPEN DITURES BY PURPOSE
[Fiscal years. In billions]
1952
actual

Protection, including collective
security________________ __ _ 346.2
________
Civil b en efits.____
12.1
Interest___________ __ ______
5.9
Civil operations and administra
tion________ __________ _____
2.0
Reserves and adjustments____ _
-.9
Total_____

___________

65.4

1957
1956
estimated estimated

1953
actual

1954
actual

1955
actual

352.2
13.4
6.6

348.3
11.4
6.5

342.7
13.7
6.4

341.4
13.8
6.9

342.4
13.9
7.1

2.1

1.6

1.7

2.1
.1

2.2
.2

74.3

67.8

64.6

64.3

65.9

further in the strengthening of ag
riculture and in the building of
schools.
The budget also recommends
legislation to increase postal rates
so that the postal system can be
come self-supporting in the future.
The recommendations for civil
benefits and services are guided by
two basic principles: First, the
greatest progress will be made by
relying on private initiative as the
mainspring for economic growth.
Second, the interests of our citizens
can be best advanced by encourag
ing State and local governments to
strengthen themselves and thus
keep as much Government respon
sibility as possible in the States and
communities, close to the people
themselves.
These principles serve to multi
ply the effectiveness of Federal ex
penditures by encouraging private,
State, and local government inter
ests to join in partnership with the
Federal Government in meeting
needs for essential services.
Interest.—Payments of interest
in the fiscal year 1957 are esti
mated at 7.1 billion dollars, 191
million dollars more than in 1956.
The increase reflects the higher
average level of interest rates now
prevailing.
Civil operations and administra
tion.—These expenditures cover
predominantly the! traditional ac
tivities of the Government. They
include expenses for tax collection,
various central management serv
ices, and the bulk of the expendi
373027 0 - 5 6 - 2

tures for the legislative branch,
the judiciary, various regulatory
activities, and the administrative
expenses of many cabinet depart
ments and independent agencies.
The 1957 budget recommends
selective increases in a number of
these activities. For example, it
provides for an increase in our
diplomatic representation abroad
to bring about better mutual un
derstanding and friendship. In
creases are also recommended for
central property and records man
agement to enable greater econ
omies to be achieved in carrying
out the other activities of the
Government.
Budget expenditures indi
cating
controllability. — An
other way to look at budget ex
penditures is from the point of view
of their relative controllability
through the budget process. Each
year when the budget is being de
termined, a large part of the esti
mated expenditures cannot be sub
stantially modified either by action
of the executive branch or of the
Congress through the appropria
tions process, but only by longer
term review and action. The level
$ Billions
M B B B H H H B 40-4
National Security

M a la r

Relatively Uncontrollable
o »w

■

BUDGET EXPEN DITU RES INDICATING CONTROLLABILITY
[Fiscal years. In billions]
1956
1957
estimated estimated

1952
actual

1953
actual

1954
actual

1955
actual

Major national security__ _ __ 344.0
Relatively uncontrollable_______ 12.3
9.1
Other____ _ __ _ ____ _____

350.4
14.9
9 .0

346.9
14.3
6.6

340.6
16.3
7.6

339.5
16.5
8.3

340.4
16.5
9 .0

74.3

67.8

64.6

64.3

65.9

Total___ _______________

65.4

of these expenditures depends up
on provisions of the laws which
authorized the programs and on
other factors not readily subject
to budgetary control.
For example, expenditures for
veterans’ benefits depend upon the
benefit rates established pursuant
to law and upon the number of eli
gible veterans who apply. Interest
expenditures are determined by the

size of the public debt and by in
terest rates. Expenditures for
farm price supports under existing
law are largely governed by such
factors as the weather and world
prices.
In the fiscal year 1957, expendi
tures for the major programs which
are not readily controllable through
the budget process are estimated
at 25 percent of total budget ex
penditures.

Budget Receipts
Budget receipts in the fiscal year
1957 are estimated to increase by
1.8 billion dollars over the estimate
for 1956 and by 5.9 billion dollars
over actual receipts in 1955.
The rise in estimated revenues
over the fiscal year 1955 results in
large part from the substantial ad
vance in individual and business
incomes which occurred during
the calendar year 1955. Further
growth in the national economy is
anticipated for the calendar year
1956.
In the fiscal year 1957, income

taxes on individuals and corpora
tions will account for 78 percent

Corporation
Income Taxes

S20.0
Excise Taxes

Individual
Income Taxes

$9.8

$31.7

$4.8
Ö*ti«f
fiscal Y«arî957E#f»i»ated

;

of estimated revenues. An addi
tional 15 percent will be raised
through excise taxes on liquor,
gasoline, tobacco, and other prod
ucts and services. The remaining
7 percent will come from customs,
estate and gift taxes, sales of Gov
ernment products and services, and
other miscellaneous sources.
In 1954, reductions in Govern
ment spending made possible a tax
cut of almost 7% billion dollars.
This tax cut was appropriate in that
period of transition from the Ko
rean conflict to a peacetime econ
omy.
The estimates of budget receipts
for the fiscal years 1956 and 1957
are based on the tax rates now exist
ing. They therefore reflect the
recommended continuation for an
other year of the corporation in
come tax and excise tax rates which
are scheduled for reduction on
April 1, 1956 under present law.
In the 1957 budget message, the
President noted that the present
level of taxes is still very burden
some and in the interest of long

term and continuous economic
growth, should be reduced when
we prudently can.
However, he went on to state,
“ It is essential, in the sound man
agement of the Government’s
finances, that we be mindful of our
enormous national debt and of the
obligation we have toward future
Americans to reduce that debt
whenever we can appropriately do
so. Under conditions of high
peacetime prosperity, such as now
exist, we can never justify going
further into debt to give ourselves
a tax cut at the expense of our
children. So, in the present state
of our financial affairs, I earnestly
believe that a tax cut can be
deemed justifiable only when it
will not unbalance the budget, a
budget which makes provision for
some reduction, even though mod
est, in our national debt.”
Thus, the 1957 budget makes
provision for a reduction in the
national debt of .1 billion dollars
in 1956 and an additional .5 bil
lion dollars in 1957.

BUDGET REC EIPTS
[Fiscal years. In billions]

Individual income taxes _ _ __
Corporation income taxes. ____
Excise taxes__ __ _____
__
All o th er__ _ _
___ __
Total __ _ ______ ______

1957
1956
estimated estimated

1952
actual

1953
actual

1954
actual

1955
actual

327.9
21.2
8.9
3.4

330.1
21.2
9.9
3.6

329.5
21.1
10.0
4.1

328.7
17.9
9.1
4.7

330.3
19.9
9.8
4.5

331.7
20.0
9.8
4.8

61.4

64.8

64.7

60.4

64. 5

66.3

New Authority To Incur Obligations
Federal agencies cannot incur
financial obligations or spend
money until the Congress author
izes them to do so.
Authorizations by the Congress
take a number of forms. Most
common is an appropriation,
which permits a Government
agency to (1) employ personnel,
order supplies and equipment,
award contracts, and incur other
obligations, and (2) pay the bills
arising from the obligations.
The amount of Government
spending in any one fiscal year is
usually not the same as the amount
of new authority to incur financial
obligations granted by the Con
gress for that year. There is an
interval between the time the Con
gress grants an appropriation and
the time Government agencies
place orders for goods and serv
ices. More time passes, while the
goods and services are being
produced and delivered, before all

the funds are actually spent.
In some cases, such as the pay
ment of wages and salaries to Gov
ernment employees, the time inter
val between incurring the obliga
tions and making the expenditures
is short ; in other cases, such as the
procurement of ships, aircraft,
and complex military equipment,
expenditures may take place sev
eral years after the incurring of the
obligations because of the time re
quired for production.
Thus, only part of the total new
authorizations granted by the Con
gress for any one year will be spent
in that year. The remainder will
be spent in future years. Over the
period, the total amount of ex
penditures is controlled by the total
amount of enacted obligational
authority.
For the fiscal year 1957, re
quested new authority to incur ob
ligations is within the amount of
estimated budget receipts. In the

Fiscal Year 1957 Estimated

WÈÊÈÊÈÈÊKKKÈÈIÈIÈKÈÊÊÊÊÈKÈÊÈÈÈÈÈÈË
New

Obligcrtional
Authority

To be spent
in 1 95 7

To be spent
after 1 95 7

6 6 .3

preceding 3 years, the new authority was also kept below the level
of revenues. Thus, the annual income of the Government has covered, and the budget proposes that
it continue covering, the new com-

mitments which lead to budget expenditures. Balanced budgets can
be made possible and maintained
in the future only through such
persistent action,

Unexpended Balances oj Appropriations
Amounts of previously enacted
appropriations which have not yet
been spent are called unexpended
balances. In most cases, they
have been obligated to pay for
goods and services which have
been ordered but not yet delivered.
Unexpended balances of appro
priations carried over from prior
years ran to nearly 80 billion dol
lars at the end of the fiscal year
1953, representing an enormous
backlog of commitments for which
expenditures had to be made in the
fiscal year 1954 and subsequent
years. Thus, they were a heavy
overhanging load for the budget
on top of the appropriations being
enacted currently.
By the end of the current fiscal
year (that is, over the 3-year pe
riod 1954-1956), it is estimated
that these balances will be reduced
by well over one-third to below 50
billion dollars. This amount is be
lieved to be more reasonable in its
relation to actual needs for current
operations. Because of the length
of time required to produce cer

tain types of heavy equipment,
some amount of unexpended bal
ances of appropriations is neces
sary for the orderly and efficient
functioning of the Government.
Although new authority to incur
obligations will be slightly greater
than expenditures in the fiscal year
1957, the backlog of balances is
expected to be reduced further as
some appropriations enacted in
prior years will be allowed to
lapse. This reduction continues
the policy of eliminating excessive
unexpended balances.
UNEXPENDED BALANCES
[In billions]

Fiscal year

1952__________
1953__________
1954__________
1955__________
1956 est . __
1957 est_______

Amount
brought
forward into
the year

350.3
68.8
78.4
67.8
52.1
47.6

Amount
carried
over to
next year

368.8
78.4
67.8
52.1
47.6
46.8

N ew Obligation al A uthority an d Budget
Expenditures by A gency
For those who are interested in
following the progress of the
budget proposals in the Congress,
the grouping of these proposals by
agencies is essential. This is be
cause the Congress generally re
views Government activities agency
by agency, and appropriates funds
for each activity to the Govern
ment agency responsible for it.
Accordingly, the budget sets
forth separately for each agency

the amount of recommended new
authority to incur obligations,
along with detailed supporting
schedules showing estimated obli
gations and expenditures of the
agency.
The table below shows the rec
ommended authorizations and esti
mated expenditures for the fiscal
year 1957 for each major Govern
ment agency, with comparable fig
ures for 1955 and 1956.

NEW OBLIGATIONAL AUTHORITY AND BUDGET EXPENDITURES BY AGENCY
[Fiscal years. In millions of dollars]

Agency

New obligational authority

Net budget expenditures

1957
1956
1955
esti
recom
enacted mated
1 mended

1955
actual

1956
esti
mated

Department of Defense:
Military functions________________ __ 30, 787
Civil functions............................................
468
Treasury Department.................................. ..... 7,137
Funds appropriated to the President:
Mutual Security Program....................... . 2, 781
Other.........................................................
14
Veterans Administration..................... ............. 4,358
Department of Agriculture________________ 2, 841
Department of Health, Education, and Wei2,010
Atomic Energy Commission_______________ 1, 285
Department of Commerce________________
1,438
Department of the Interior______ _________
491
Housing and Home Financc Agency________
584
Department of Labor.......................................
447
Department of State................. .......................
131
Department of Justice.............. ..... ..................
189
General Services Administration..................... .
533
Post Office Department (general fund)______
363
1,219
Total— ___________________ _____

57,076

1957
esti
mated

33; 147
650
7,664

34,907
665
7,813

35, 532
548
6,800

34, 575
602
7,611

35, 547
629
7,942

2,703
50
4,763
3,600

4,860
10
4,850
3,150

4,219
162
4,405
4,636

4,190
272
4,732
3,653

4,292
61
4,820
3,661

2,133
1,179
1,600
514
888
484
150
212
707
441
1,099

2.654
1, 837
1,635
582
537
502
239
236
218
120
1,475

1,993
1, 857
1,077
515
153
394
137
182
973
356
630

2,132
1, 715
1,298
557
19
459
154
219
658
483
941

2, 303
1,946
1,428
616
-6 7
492
167
218
556
117
1,138

61, 984

66,291

64, 570

64,270

65, 865

1 Includes 61,219 million dollars already enacted and 766 million dollars proposed for action in the cur
rent session of the Congress.
N o t e . —Detail

may not add to totals because of rounding.

Glossary of Selected Budget Terms
New obligational authority.—The total amount of budget authoriza
tions to incur obligations granted to the Federal agencies for a given
year by the Congress. These authorizations are usually in the form of
appropriations and must precede all budget obligations and expenditures.
New obligational authority may include some extension, for obligation
in the current year, of unused authorizations from prior years which
would otherwise expire.
Obligations.—Orders placed, contracts awarded, personal services
received, or other similar commitments by agencies to buy goods and
services requiring the eventual payment of money (expenditures).
These actions are taken by the agencies under the obligational authority
granted by Congress.
Budget expenditures.—With few exceptions these are checks issued to
liquidate obligations incurred under current or previous year author
izations. Expenditures may follow obligations by a few weeks or in
some cases by as much as three or more years. They exclude payments
from funds held in trust and payments to retire public debt securities.
Budget receipts.—Federal income consisting of personal and corporate
taxes, excises, customs, and other revenues, less amounts refunded on
previous overpayments of taxes. They exclude funds received in trust
and amounts borrowed through the sale of Government securities.
Budget deficit.—The excess of budget expenditures over budget re
ceipts in any fiscal year.
Budget surplus.—The excess of budget receipts over budget expendi
tures in any fiscal year.
Unexpended balances of prior year appropriations.—The unexpended
portions of prior year appropriations, largely obligated, which are
brought forward and are currently available for expenditure. They are
commitments for which actual funds were not provided in prior years
and which must be met as expenditures in the current or future years.

The 1957 Budget
Individuai
Income Taxe*

31,7

Corporation IncomeTaxes

llll ll l l ll l l l l l

20.0

Excise Taxes-Liquor and Tobacco

4.5

Excist Taxes - Other

5.3

1957 Estimated Expenditures
$65.9 Billion

Customs and Other Receipts jfflj 4.8

Security

7.1

W Interest

4.9

U Veteran*

3.4 Ü Agriculture

1957 Estimated Receipts

$66.3

Billion

3.0 i Labor and Welfare

2. ! Ü International
2,1 y Commerce and Housing
1.7 §j General Government
\

.0 1 Natural Resources

Reserve for Contingencies

Part 2

Budget Expenditures
The section which follows de
scribes, by major function or pro
gram, the Government activities which
are included in the 1957 budget.
The charts in this section show the
estimated expenditures in 1957 for
the activities under each major func
tion or program. Comparative fig
ures covering the last 5 years are
presented in a table on pages 52 and
53.

. 61.3% of the 1957 Budget
or $40,370 Million

M ajor N ational Security
Military planning must combine
present defense with the probable
needs of a long period of uncer
tain peace. Thus, the 1957 budget
continues the policies of the past 3
years in providing for the building
of our military strength through
a sound, long-range program
which does not assume a fixed date
of maximum danger.
This long-range program is giv
ing us the greatest military power
in our peacetime history.
Procurement of military equip
ment will be directed toward mod
ernizing our forces. Over one-half
of these expenditures will be for
aircraft, mainly long-range jet
bombers and supersonic fighters
18

and interceptors. Expenditures
for guided missiles in 1957 will be
the highest in history. Moderni
zation of the fleet will be carried
forward.
Estimated expenditures for pay
and support of active duty military
personnel will cover an average of
2,815,700 personnel. The budget
includes amounts for new pro
posals to add career incentives for
members of the Armed Forces.
Costs of operation and mainte
nance will rise in 1957, mainly be
cause of the greater number of air
bases and radar sites and the larger
quantity and increasing complexity
of new weapons and equipment.
Under the Mutual Security Pro

Major National Security
B u d g et E x p e n d itu re s in 195 7 — E stim a te d

r t ^

gram, the United States helps
equip and train the forces of our
allies. In the fiscal year 1957,
about one-half of the military por
tion of the Mutual Security Pro
gram will be concentrated in
Korea, Pakistan, Taiwan, and Tur
key. In addition, plans are under
way to furnish more modern
defense weapons and equipment
to our NATO partners.
Expenditures for atomic energy
will rise to a record level, with
greater attention being given to
peaceful uses.
An increasing number of objec

$ MiUÌONS

tives for our stockpile of strategic
and critical materials are being
met, and expenditures for this pur
pose are declining.
[In millions]
Fiscal year

Net budget New obliexpendi
gational
tures
authority

1957 est _
_ ___ 340, 370
1956 est
39,467
1955______________ 40,626
1954____________ _ 46,904
1953______________ 50, 363
1952______________ 43,976

339, 743
35, 870
33, 656
38,901
57, 298
68,026

. 3.2% of the 1957 Budget
or $2,108 Million
[8.3% of Budget other than Major National Security]

International A ffairs and Finance
Expenditures for economic and
technical development, largely
under the Mutual Security Pro
gram, help those of our allies
whose national economies, un
aided, cannot support the military
forces required for our common
defense. In addition, these ex
penditures assist less developed
countries in their efforts to achieve
the economic growth and stability

necessary to maintain their inde
pendence. Where possible, our
surplus farm products are being
used for these purposes.
Our technical cooperation helps
provide knowledge and skills to
overcome hunger, disease, and il
literacy. Support is also pro
vided for the technical assistance
programs of the United Nations
and the Organization of American

International Affairs and Finance
B u d g et E x p e n d itu re s in 1957 — E stim a te d

States, as well as for international
programs for refugees, children,
and emigrants from Europe.
Overseas trade and investment
are being stimulated through direct
loans and guaranties of private
loans by the Export-Import Bank.
The 1957 budget recommends
increased appropriations for the
Department of State to (1) enable
it to conduct our foreign affairs
more effectively, (2) expand its
present headquarters building to
house all of its Washington staff,
and (3) improve various overseas
facilities. Increased contributions
are also recommended to support
the expanding activities of the
United Nations and its specialized
agencies.
Recent international develop
ments have emphasized the impor
tance of bringing the truth about
the United States and its peaceful
objectives to other people. Accord

ingly, the 1957 budget provides for
strengthening our overseas infor
mation and educational exchange
programs.
Provision is also made for con
tinued participation in interna
tional trade fairs and for further
cultural presentations abroad by
outstanding American actors and
musicians. These activities are
for the purpose of enabling for
eign citizens better to understand
and appreciate the character of our
free society.
[In millions]
Fiscal year

_ __
1957 est__
1956 est___________
1955______________
1954— ___________
1953______________
1952_______ ______

Net budget New obliexpendi gational
tures
authority

$ 2,108

2,053
2,181
1, 732
2,216
2, 826

32, 332
2,118
2, 304
1, 838
2,149
3, 529

7.4% of the 1957 Budget
or $4,879 Million
[19.1% of Budget other than Major National Security]

Veterans9 Services and Benefits
The greatest portion of budget
expenditures for veterans is for
direct benefits. Although benefit
payments are increasing, overhead
costs are being reduced through
improved administration.
We now have more than 22 mil
lion veterans. When dependents
and survivors are considered,
nearly one-half of our population
is potentially entitled to veterans’
benefits.
With so large a part of our pop
ulation potentially involved, the
findings of the President’s Com
mission on Veterans’ Pensions will
be of great interest. The report,
to be issued later this year, will
deal with veterans’ nonmedical

programs in relation to each other
and to other types of civil benefits.
In the fiscal year 1957, compen
sation for service connected disa
bilities will be paid to 10 percent
of World War II veterans and 7
percent of the veterans of World
War I. On the other hand, pen
sions for disabilities not connected
with military service will be drawn
by fewer than one-half of 1 per
cent of the veterans of World War
II, but by 20 percent of the vet
erans of World War I. Under
present legislation, expenditures
for these pensions will rise signi
ficantly in future years as our vet
eran population ages.

Veterans' Services and Benefits,
B u d g e t E x p e n d itu re s in 1 9 5 7 — E stim a te d

$ MILLIONS

2,937,

t Benefit» for Unemployment, Loan Guaranty, Other

Estimated expenditures for hos
pitals and medical care include 758
million dollars for current ex
penses and 57 million dollars for
construction and repair. Care
will be provided during 1957 for
a daily average of 114,900 hos
pital patients and 26,200 domi
ciliary home members. Almost
two-thirds of all these beneficiaries
receive treatment or care for con
ditions not related to their military
service.
Education and training, unem
ployment compensation, and other
benefits for veterans of the Korean
conflict constitute the bulk of the

894 million dollars of readjustment
expenditures estimated for 1957.
For veterans of World War II, the
readjustment program is drawing
to a close.
[In millions]
Fiscal year

Net budget New obliexpendi gational
authority
tures

1957 est___ _______ 34, 879
4, 793
1956 est___________
1955_______________ 4,457
1954______________
4,256
1953______________
4, 298
1952______________
4, 863

34, 892
4, 805
4, 369
4, 272
4,132
4,391

. 4.5% of the 1957 Budget
or $2,995 Million
[11.7% of Budget other than Major National Security]

Labor and TVelfare
The labor and welfare programs
of the Federal Government con
tribute to the objectives of greater
human well-being and a growing
economy. Many of these pro
grams are designed to promote in
dividual opportunity and to foster
self-reliance.
About 80 percent of the esti
mated budget expenditures for
labor and welfare services in the
fiscal year 1957 are in the form
of grants to State and local gov
ernments.
Public assistance grants help the
States finance benefits to 5 million
people in need, mostly persons over
65 and dependent children.
Public health programs empha
size research in preventing and
24

treating diseases, and help provide
hospitals, clinics, and other health
centers. The 1957 budget provides
for a substantial expansion of med
ical research and for new measures
to assist the States in meeting
such problems as water pollution,
mental health, and training of
nurses.
The budget includes funds for
the recommended new program of
general Federal assistance for
school construction. Other educa
tion programs help provide schools
in communities especially affected
by Federal activities, and contrib
ute toward vocational education,
schools for Indian children, and
land-grant colleges.
The Federal-State employment

Labor and Welfare =
B u d g e t E x p e n d itu re s in 1957 — E stim a te d

service and unemployment insur
ance system is being strengthened.
Labor and manpower programs in
clude also regulation of labor re
lations, promotion of occupational
safety, collection of labor statis
tics, and operation of the Selective
Service System.
The National Bureau of Stand
ards and the Census Bureau con
duct general-purpose research.
The National Science Foundation
supports such research, including
the United States program for the
International Geophysical Year to
be held in 1957-1958. General
373027 0 - 56 - 4

libraries and museums include the
Library of Congress, the Smith
sonian Institution, the National
Gallery of Art, and the Botanic
Gardens.
[In millions]
Fiscal year

1957 est___________
1956 est__
_____
1955______________
1954______________
1953______________
1952______________

Net budget New obli
expendi gational
tures
authority

32,995
2,767
2,552
2,485
2,426
2,168

33,387
2, 807
2, 614
2,429
2,456
2,106

. 5.1% of the 1957 Budget
or $3,364 Million
[13.2% of Budget other than Major National Security]

Agriculture and Agricultural Resources
The budget recommendations
for agricultural programs for the
fiscal year 1957 are designed to
promote a stable, free, and pros
perous agriculture. They include
a strengthening of existing pro
grams as well as the President’s
new proposals for a soil bank and
other special measures to help
farmers share more fully in the
nation’s prosperity.
Despite the increase in Govern
ment spending in 1957 for the new
proposals, net budget expenditures
for all agricultural programs are
estimated to be slightly less than

in 1956, because net outlays for
farm price supports are expected
to decline. Vigorous efforts are
being made to find markets at home
and abroad for the present sur
pluses of farm commodities.
The new soil bank proposal is de
signed to aid farmers in adjusting
to a farming pattern appropriate
for today’s markets. It includes
(1) an acreage reserve to reduce
current and accumulated surpluses
of certain crops and (2) a conser
vation reserve to achieve other
needed land use adjustments.
Other proposals include increased

ESTIMATED GROSS AND N ET BUDGET EXPENDITURES, FISCA L YEAR 195 7
[In millions]

Program

Farm price support and related programs. _______ ____
Soil bank and accompanying proposals_______________
Agricultural land and water resources___ _________ _
Rural electrification and rural telephone loans________
Farm ownership and operation loans_________________
Research and other agricultural services__ ____ _____
Total_____

______________________________

,
Gross
expendi Applicable
receipts
tures

Net f
expendi
tures

35,479
1400
352
239
2,376
224

33,512

2,163
13

31,967
1400
334
239
213
211

9,070

5,706

3, 364

1 In addition, proposed refunds to farmers of Federal taxes on gasoline used in farm operation are
estimated at 60 million dollars.

Agriculture and Agricultural Resources
Budget Expenditures in 1957

—

Estimated

purchasing and redistribution of
perishable commodities which are
temporarily in excess supply and a
program for farm improvement
and better land use in the Great
Plains States.
Budget expenditures for agricul
tural land and water resources are
expected to increase in 1957 as part
of a broad program designed to
give additional emphasis to soil
conservation and watershed pro
tection.
The 1957 budget includes loan
programs for rural electrification
and rural telephones at about the
same level as in 1956 and sub
stantially higher than in 1955. It

also provides for the proposal to
increase loans to low-income farm
ers under the expanded Rural
Development Program.
Research and educational activ
ities to encourage more efficient
farm production and marketing
will also be increased.
‘[In millions]
Fiscal year

1957 est___
1956 est___
1955______
1954______
1953______
1952______

Net budget New obliGross
expendi gational
budget
authority
expenditures
tures

39,070
8,575
9, 324
7,497
6, 448
0)

1 Data not available.

33, 364
3,376
4,411
2, 557
2,936
1,045

32, 872
3, 324
2, 672
4,010
1,333
1,688

. 1.6% of the 1957 Budget
or $1,031 Million
[4.0% of Budget other than Major National Security]

N atural Resources
Resource development is every
one’s responsibility. State, local,
and private groups can best carry
out many needed programs them
selves. Where projects are beyond
the means or needs of local groups,
Federal participation can be the
necessary element in accomplish
ing broad national aims. There
fore, a partnership policy has been
adopted by the administration,
under which emphasis is placed on
sharing the cost of projects with
groups which will receive direct
benefits from them. In this way,
the effect of Federal expenditures
in stimulating conservation and
development is multiplied.
In the fiscal year 1957, the
28

Corps of Engineers and the Bureau
of Reclamation will continue work
on 187 going projects for flood
control, irrigation, and multiplepurpose developments. The budg
et also provides for these agencies
to start 41 new projects and to
participate with State and local
groups in additional projects where
national interests are involved.
The budget provides for the
Tennessee Valley Authority to start
an additional steam-electric unit in
1956 and 2 additional units in
1957. These will" be needed to
meet currently anticipated power
loads through the calendar year
1958. Legislation is recommended

Natural Resources =
B u d g e t E xp e n d itu re s in 1957 — E stim a te d

to finance these units in 1957
through the sale of revenue bonds
by TVA. When they are com
pleted, TVA will have a capacity
of 6.7 million kilowatts in its
steam-electric plants and 2.7 mil
lion kilowatts in its hydroelectric
plânts.
Funds are provided in the
budget to expand forestry research
and soil conservation work in the
national forests, public domain and
Indian lands, and the national
parks. In the calendar year 1957,
54 million visitors to the national
parks are expected.

The Department of the Interior
will operate 88 fish hatcheries and
264 wildlife refuges in 1957 and
will aidjhe States in their fish and
wildlife restoration projects.
[In millions]
Fiscal year

1957 est___________
1956 est___________
1955______________
1954______________
1953______________
1952._____________

Net budget New obliexpendi gational
tures
authority

31,031
1,045
1,081
1,220
1, 364
1,264

31,121
1,045
966
1,201
1,402
1,329

. . . 3.1% of the 1957 Budget
or $2,071 Million
[8.1% of Budget other than Major National Security]

Commerce and Housing
Commerce and housing pro
grams primarily encourage the
development of private enterprise
and local communities.
Highway expenditures cover
mainly Federal-aid grants to the
States. The budget message rec
ommends a new program of sub
stantial size to modernize the Inter
state Highway System. Since this
proposal had not taken definite
form at the time the budget was
sent to Congress and since it is
contemplated that the balance be
tween receipts and expenditures
will not be affected, specific
amounts are not included in the
initial 1957 budget estimates.
Ship operators are replacing the
World War II merchant fleet with

the aid of Federal subsidies. Sub
sidies also cover certain differences
between costs of operating Ameri
can and foreign ships. The budg
et also provides for work to con
tinue on 61 navigation projects
and to begin on 42 new projects.
The 1957 budget recommends
further expansion of the traffic
capacity of the congested airway
system. It also proposes a com
prehensive study of the longrange needs for aviation facilities.
Grants for local airport construc
tion will increase. Airline subsi
dies are being reduced.
Federal loans and grants are
helping more than 200 communi
ties prevent or remove slums. The

ESTIMATED GROSS AND N ET BUDGET EXPENDITURES, FISCA L YEAR 195 7
[In millions]
Net ex
Gross ex Applicable penditures
penditures receipts or net re
ceipts (-)

Program

Highways.________
Water transportation, _ __ __ ____ __
______ __
Aviation__
__ __ __ _ _ __ ______
_
_ __
Community development and public housing______
Other aids to housing _______
_____ ________ __
Postal service _ ______ ___________
_ __ _ __
Civil defense, business aids, and other. _______
_____
Total___ ___________________

_____

3844
749
309
736
688
2,680
293

556
909
2, 563
80

3844
629
309
180
-2 2 1
117
213

6, 299

4,228

2,071

3120

Commerce and Housing
Budget Expenditures in 1957 — Estimated

budget recommends authority to
assist local agencies finance an ad
ditional 35,000 public housing
units in each of the next 2 years.
Receipts from sales and repay
ment of mortgages and from in
surance premiums will exceed ex
penditures for other housing aids.
Direct loans to colleges for dormi
tory construction are increasing,
but legislation is being proposed to
encourage more private financing.
Legislation is again being re
quested to raise postal rates and
thus reduce the estimated postal
deficit by 350 million dollars in
1957.

The budget includes larger
amounts for civil defense, and pro
poses new programs for flood in
demnities and for helping chronic
labor-surplus areas undertake rede
velopment programs.
[In millions]
Fiscal year

Gross Net budget New oblibudget ex expendi
gational
penditures
authority
tures

1957 est---- 36, 299
1956 est___ 6, 259
6,139
1955______
6,492
1954______
7,377
1953______
1952______

32,071
2,182
1,622
909
2,612
2, 722

33,006
3, 492
2,919
2,570
3,587
2,997

1 Data not available.

. 2.7% of the 1957 Budget
or $1,757 Million

[6.9%of Budget other than M ajor National Security]
/

reral Government

Expenditures under this head
ing are for the traditional, domes
tic, civil activities of the Govern
ment and for certain governmentwide activities, such as personnel
and property management.
Most financial management ac
tivities are carried on by the Treas
ury Department, which collects
taxes and customs duties, manages
the public debt, mints coins, prints
32

the currency, and issues the checks
to pay the Government’s bills.
The Government contributes, as
the employer, to retirement funds
for Federal civilian employees.
About 300,000 retired employees
or their survivors are currently re
ceiving payments. Unemployment
and accident compensation pay
ments are also made.
To increase the efficiency of Gov

General Government =
B u d g et E xp e n d itu re s in 195 7 — Estim ate d

gnd Offetr

fe S ^ lllilll

ernment operations, the budget
provides for construction of sev
eral new buildings and for re
modeling and air-conditioning
others. In addition, many tempo
rary or inadequate buildings will
be replaced through construction
privately financed under leasepurchase contracts.
Expenditures for claims and
judgments are largely for certi
fied claims arising mainly from
operations of the Department of
Defense. Substantial payments
will also be made on claims aris
ing from the Texas City disaster.
Construction of the new Senate

Office Building will be almost
completed in the fiscal year 1957.
Work will be well underway on
the new House Office Building and
on the extension of the Capitol au
thorized by the Congress last year.
[In millions]

Fiscal year

N et budget New obliexpendi
gational
tures
authority

1957 est___________ 31,757
1956 est___________
1,611
1,201
1955______________
1954______ ________ 1,239
1953___________ _
1,474
1952______________
1,464

31, 621
1, 525
1,138
1,074
1,368
1,415

10.7% of the 1957 Budget
or $7,066 Million
[27.7% of Budget other than Major National Security]

I/¿t ere st
Interest payments are deter
mined by the size of the public debt
and by interest rates.
The present economic prosperity has created a heavy business
and consumer demand for credit.
Consequently interest rates have
been rising and maturing Government securities are being re34

financed at the higher rates pre
vailing in the money market.
More than one-half of the inter
est
< on the public debt is paid on
marketable
obligations.
]
Another one-quarter of the inter
est
< on the public debt is paid on
ssavings bonds. About one-third
of
< all American families own Gov-

Interest
B udg et E xp e n d itu re s in 1957 — E stim ate d

W n jra» f w W H w f f T U w t f V w M f ^ ï l O I I I

t~w\; „ s , - -

1 * : . ■■' *
Interest è frfé m à * «w| tNamft j ïm è*

erament savings bonds at the pres
ent time. The interest rate paid
on these bonds is higher than the
average rate on the total public
debt.
The interest rate on most of the
special securities sold to Govern
ment trust funds is fixed by law.
Other nonmarketable obliga
tions are mainly investment bonds
held by long-term investors.
Interest payments are fixed obli
gations of the Federal Government.
Unlike most budget expenditures,

they are provided for by perma
nent law and, therefore, do not
require annual appropriations by
the Congress.
[In millions]
Fiscal year

Net budget New obliexpendi gational
authority
tures

1957 est# __________ $7,066
6,875
1956 est___________
1955______________
6,438
6,470
1954______________
1953______________
6, 583
1952___ ___________ 5,934

$7,066
6, 875
6,438
6,470
6, 583
5,934

Budget Expenditures
os a Percentage of National Income

Peak WorYear

Per Capita
$707

Pcalt WorYta»

*^Jan. 9, 1953 Budget Document Estimate

Part 3 Supplementary Inf ormation

This section presents a number of
classifications of budget expenditures
which are of interest. These classifi
cations represent different ways of
grouping amounts already included
in the expenditures discussed in Parts
I and 2.
In addition, this section provides
information on other aspects of Fed
eral financial operations, such as
Federal credit programs and trust
funds, and includes historical data on
budget receipts, expenditures, and the
public debt.

Gross and N et Budget Expenditures
by Agency
In carrying out their functions,
a number of Government agencies
engage in business-type operations
with the public. They receive
money from their customers or
clients (for example, interest and
collections on loans) and use
these receipts to continue carrying
on their operations. Some public
enterprise activities are organized
as Government corporations; oth
ers, such as the Post Office, are
unincorporated.
The effect of the operations of
these enterprises on the budget
surplus or deficit depends on their
net expenditures or receipts. How
ever, the net figures seriously un
derstate the scope of the Govern
ment’s activities and the total
amounts actually paid out each
year by the Government. In the
fiscal year 1957, for example, the
receipts of the public enterprises
which are deducted from the total
payments to derive net budget ex
penditures are estimated to be 11
38

billion dollars.
In the Department of Agricul
ture, most of the receipts come
from repayment of loans and from
sale of commodities under the
price support program of the
Commodity Credit Corporation.
The Farm Credit Administra
tion, through the Federal inter
mediate credit banks, makes short
term loans to finance farm pro
duction. Most of these are repaid
within the fiscal year.
Post Office Department receipts
represent the sale of postage
stamps and fees for services.
The bulk of the public enterprise
receipts of the Housing and Home
Finance Agency are from the pri
vate refinancing of loans made by
the Public Housing Administra
tion, from repayments and sales of
mortgages held by the Federal Na
tional Mortgage Association, and
from premiums on mortgages in
sured by the Federal Housing
Administration.

Gross and N et Budget Expenditures
by Agency
[Estimated for fiscal year 1957. In millions]

Applicable
Gross budget receipts of Net budget
expenditures public enter expenditures
prise funds

Agency

Legislative branch_________ ______ _____ _
$123
The judiciary___ _______________
______
41
Executive Office of the President__________ ____
10
Funds appropriated to the President:
Mutual Security Program___ _ ____ ___ __
4, 296
Other (mainly expansion of defense produc
tion)___ __ _________________________
366
Independent offices:
Atomic Energy Commission._ __ _ __ __
1,946
Export-Import Bank__________________ __
291
Farm Credit Administration____ ______
2,111
Tennessee Valley Authority_______________
230
Veterans Administration_____ _ _______
4,945
Other________ _________________ _______
878
General Services Administration______ _______
560
Housing and Home Finance Agency.___ ______
1,287
Department of Agriculture. _____ _____________ * 7,372
Department of Commerce________ ___________
1,461
Department of Defense:
Military functions___ ____________ _____
35, 547
715
Civil functions__ _ _____ _ _________ _
Department of Health, Education, and Welfare. _
2, 305
Department of the Interior. ______ _______ _
643
____ __
218
Department of Justice. _ . . .
Department of Labor__ ___ _______ ______
494
Post Office Department__ _________
______
2,680
Department of State
__
.
167
7, 969
Treasury Department___ ____ _____ ______
33
District of Columbia (Federal payment and loans).
225
Reserve for contingencies._
_
Total__ _

_________ .

_____

___

76,914

$123
41
10
$4

4, 292

304

391
2,084
257
125
72
4
1,354
3,711
33

1,946
-1 0 0
27
-2 7
4, 820
806
556
-6 7
3,661
1,428

w
86
2
28
2
2, 563
27

11,049

35, 547
629
2, 303
616
218
492
117
167
7,942
33
225
65, 865

i Less than 500,000 dollars.
N o t e . —Detail may not add to totals because of rounding.

Trust Funds
The budget receipts and expend
itures discussed so far reflect trans
actions in funds belonging to the
Federal Government. The Gov
ernment also collects and pays out
sizable sums for the various funds
which it holds in trust for others.
Receipts of these trust funds
come mainly from payroll taxes
paid by employees, employers, and
self-employed persons. In the
case of veterans’ life insurance, the
receipts are primarily premiums.
Expenditures of the trust funds are
largely benefit payments.
The trust funds are currently
accumulating surpluses because
payments into them are being
made by a great many more people
than are now drawing benefits.
This accumulation is estimated to
be 1.7 billion dollars in the fiscal
year 1957, mostly in the old-age
and survivors insurance trust fund.
The rate of accumulation is grad
40

ually declining as more persons
become entitled to benefits.
Most of the excess of trust fund
income is invested in special issues
of Government bonds, and the in
terest received is a source of trust
fund income. By June 30, 1957,
it is estimated that Government
trust funds will hold 50 billion dol
lars in United States securities.
Interest on these securities will
amount to 1.3 billion dollars in the
fiscal year 1957.
The 1957 budget message in
cluded three recommendations
with respect to old-age and sur
vivors insurance: (1) extend cov
erage to certain groups now ex
cluded, (2) adjust interest rates on
securities held by the trust fund to
reflect more closely the long-term
nature of these investments, and
(3) simplify procedures for em
ployers’ reports of withheld pay
roll taxes.

Trust Funds

R EC EIPT S A N D E X P E N D IT U R E S

F is c a l Y e a r 1957 Estim ated

r-... .............

Based on E x is tin g Leg islation

I BiLUONS

O ld -A g e and
Survivors Insurance

E xp e n d itu res

Unemployment

....

1.6

Insurance

Federal Employees
Retirement

Railroad
Retirement

Trust Funds
(In billions)

Fiscal year

T otal
receipts

T o tal
expend
itures

1957 e st- _

« 1 .9
11.6

$10.2
9 .6

1955

9.5

A ll Other

1954
1953____

9.2
8.9

Trust Funds

1952_____

8.8

8.5
7.2
5.3
5.3

Veterans

- *7

Life Insurance

1956 est » _

Receipts From and Payments to the
Public
[In millions]
Fiscal year 1957
estimated

Description

Budget receipts (page 10)____ ____
__ _
____ ___
___
Trust fund receipts (page 40)_____ _____ _ __ _ _ _ __ ____
Intragovernmental transactions ___________ _____ _ _ _____
Seigniorage on silver. _______ _ _______ ___
__ __
Total, Federal Government receipts from the public_

366, 300
11,890
- 2 ,8 1 0
-2 7
_

75, 354

Budget expenditures (page 7)__ ___ ._ ____ _ _ _ _ ____
_ _ __ ..
Trust fund expenditures (page 40)__________ __ _____
Government-sponsored enterprise expenditures (net)__ __
_ ____ ..
Intragovernmental transactions______ _ _ _ __ _ __ _____
Accrued interest and other noncash expenditures (net)_ _ _ _ _ _

65, 865
10,200
45
- 2 ,8 1 0
-3 8 1

Total, Federal Government pavments to the public_____ _ _

Excess of Federal Government receipts over payments

The flow of money between the
public and the Federal Government
as a whole is shown in the above
table by consolidating budget
transactions with those of the
trust funds and certain Govern
ment-sponsored enterprises.
In this consolidation, intragovernmental receipts and pay
ments are excluded because they
are not cash transactions between
the Government and the public.
An example is the interest paid by
the Treasury on United States se

___ _ _

72,920

2,434

curities held by the trust funds.
Certain other noncash transac
tions, such as the accrual of in
terest on savings bonds, are also
eliminated, but interest actually
paid on redeemed savings bonds
is added.
It is estimated that receipts from
the public will exceed payments to
the public by 2.4 billion dollars
in both the fiscal years 1956 and
1957. In the fiscal year 1955,
there was an excess of payments to
the public of 2.7 billion dollars.

Public Debt
The 1957 budget makes provi
sion for reducing the public debt
to an estimated 273.8 billion dol
lars by June 30, 1957. Because
of the effect of the transactions of
trust funds and Government enter
prises on the Treasury’s cash bal
ances, the anticipated debt reduc
tions in 1956 and 1957 are not
precisely the same as the estimated
budget surpluses.
The immediate economic effects
of the public debt depend partly on
the arrangements made to refinance
issues of Government bonds which
become due. The Treasury has
been working closely with the
Federal Reserve System to manage
the debt in a way which helps sus
tain a growing economy without
inflation or deflation.
Interest rates have been rising
recently as the private demand for
credit has increased; the average
maturity of the debt has been

lengthened; and the number of
financing operations each year has
been reduced.
All but about one-half billion
dollars of the public debt is subject
to a legal limit of 275 billion dol
lars at the end of the fiscal year.
Last year the Congress extended
through June 1956 a law permitting
the debt to rise temporarily to 281
billion dollars during the year.
This enabled the Treasury to meet
its heavy temporary borrowing
needs during the first half of the
fiscal year when tax collections are
seasonally low.
Even with balanced budgets in
1956 and 1957, the seasonal needs
for borrowing above the 275 bil
lion dollar limit will continue. The
budget therefore recommends a
continuation of the law allowing a
temporary increase in the debt
limit during the year.

Change in Public Debt
Decrease

Federal Public JVorks
Many Federal programs involve
construction activities.
These
range from small buildings to
large river basin developments
and military installations.
State, local, and private inter
ests are encouraged to undertake

projects on their own initiative,
with Federal sharing of costs where
national responsibilities are in
volved. Direct public works are
undertaken for those essential
projects which are clearly within
the area of Federal responsibility.

BUDGET EXPENDITURES FOR PUBLIC WORKS
[Fiscal years. In billions]
1952
actual

1953
actual

1954
actual

1955
actual

1956
esti
mated

Civil public works:
Direct Federal projects _ _ _______ $1.4
Grants for State and local projects___
.6
Loans for State and local projects (net).
.2

$1.4
.7

$1.3
.7
- .4

$1.0
.8
- .1

$1.0
.9

$1.1
1.1
.1

Subtotal, civil public works . __

2.1

2.2

1.6

1.7

2.0

2.3

Public works for national security:
Military and related public works____
Atomic energy plants and facilities___

1.8
1.1

1.9
1.1

1.7
1.1

1.6
.8

1.9
.3

Subtotal, national security

2.9

3.0

2.8

2.4

2.3

2.2

Total, Federal public works__ __

5.0

5.2

4.4

4.1

4.2

4.5

Program

1Less than 50 million dollars.
N o t e . —Detail may not add to totals because of rounding.

1957
esti
mated

Federal Public Works
Budget Expenditures in 1957 ---- Estimated

At the present time, direct Fed
eral public works amount to about
8 percent of total new construction
in the Nation. State and local pub
lic construction aided by Federal
loans and grants represents an
other 4 percent.
A substantial portion of military
public works in the fiscal year 1957
will be for aviation facilities, in
cluding those for the continental
air defense system. Expenditures
for the atomic energy program are

mostly to continue work on plants
started in earlier years. They also
cover some new research and devel
opment facilities.
The estimated increase in ex
penditures for civil public works
in the fiscal year 1957 is primarily
for federally aided State and local
public works. The largest item in
this increase is the proposed new
Federal-aid program for general
school construction.

Research and Development
Federal spending in the search
for new scientific knowledge and
new uses for existing knowledge
amounts to about one-half the Na
tion’s expenditures for research
'and development. Private indus
try accounts for the second largest
amount of research expenditures.
Lesser amounts are spent by foun
dations, universities, and State and
local governments.
In the fiscal year 1957, 87 per
cent of the Federal expenditures
will be for research work and 13
percent for acquiring land, build
ings, and equipment. The re
search is done in Federal facilities
and, through contracts and grants,
in private industry, universities,
46

and other non-Federal research
centers.
The bulk of Federal research
and development expenditures is
for applied research. However,
the 1957 budget provides for a sub
stantial increase in support of general-purpose research and scientific
education, ” particularly through
programs of the National Science
Foundation. This increase in
basic research should yield many
future benefits to our national
defense and to human well-being
and economic progress.
Substantial increases in expendi
tures in 1957 are estimated for re
search and development in the
major national security programs.

Research and Development
B u d g e t E xp e n d itu re s in 1957

E stim ate d

The Department of Defense will
emphasize research on guided mis
siles, nuclear-propelled aircraft
and ships, and problems of special
importance to continental defense.
Although research in atomic en
ergy also is chiefly for military
needs, a growing amount is being
directed to peaceful uses.
The 1957 budget also provides
for expanding research in (1) the
cause, treatment, and prevention
of illness and (2) the production,
use, and marketing of farm
products.
The National Advisory Commit
tee for Aeronautics contributes to

national defense through its re
search work on the problems of
flight at faster speeds, higher alti
tudes, and longer ranges.
BUDGET EXPEN DITURES FOR
RESEARCH AND DEVELOPM ENT
[In millions]
Fiscal year

Total

$2, 557
1957 est
2, 256
1956 est
2,085
1955________
2,085
1954________
2,100
1953________
1,815
1952________

Major
national
security

32,147
1,921
1,804
1,806
1,830
1, 565

Other

3410
335
281
279
270
250

Federal Aid to
Governments

'\1 ,

Aid to State and local govern
ments in the fiscal year 1957 is
estimated to be 6 percent of total
Federal budget expenditures. In
recent years, Federal aid has been
8 to 10 percent of State and loca\
revenues.
The aid is mainly in the form of

' i (4

grants which require some State
or local matching. Legislation
proposed recently by the adminis
tration for some grants has sought
more flexibility in matching for
mulas.
The Federal Government helps
fill the gap between the need for

BUDGET EXPENDITURES FOR FEDERAL AID
[In millions]
Gross budget expenditures
Fiscal year

Total

(1)
1957 est_ _ _ _ __
$4, 523
1956 est _ ______ __
4,150
1955__________________
3,492
1954__________________
3,683
1953__________________
3,818
1952__________________
3,096

Grants-in- Shared
aid
revenues

(2)
$3, 853
3,584
3,126
2,986
2, 781
2, 393

(3)
$90
84
78
66
50
38

Loans

(4)
$581
483
288
631
987
665

Collections Net budget
on loans expenditures

(5)
$504
433
368
1,026
961
492

(6) = (1)—(5)

$4,019
3, 717
3,124
2,657
2, 857
2,604

Federal Aid to State and Local Governments—
Budget Expenditures in 1957 —Estimated

essential services and the present
ability of State and local govern
ments to meet those needs. Wher
ever possible and logical, respon
sibility and costs are shared by
State and local governments.
Public assistance grants in 1957
will comprise more than one-third
of net budget expenditures for Fed
eral aid.
Grant expenditures for highway
construction in 1957 will come
from authorizations made avail
able in previous years under the
Highway Act of 1954.
About one-half of the estimated
grants for education is for the

recommended new program of gen
eral assistance for school construc
tion. Most of the rest is for
schools in federally affected areas.
Grants and loans for low-rent
housing, urban renewal, public
works planning, and related pro
grams entail gross expenditures
estimated at 746 million dollars,
but collections on previous loans
are expected to be 504 million dol
lars.
The amounts shown in the chart
above omit Federal administrative
costs and thus differ slightly from
the related figures in Part 2 of this
booklet.
49

Federal Credit Programs
Federal credit programs consist
of both direct Government loans
and the guaranty or insurance of
private loans. These programs
exert a powerful influence on eco
nomic activity. For example,
Federal insurance or guaranties
cover about 40 percent of all out
standing home mortgages in the
Nation.
Federal credit aids are intended
to supplement and encourage pri
vate credit rather than to substitute
for it. In line with the policy of
minimizing the role of the Gov
ernment, the entire increase since
1953 in Federal commitments for
major credit programs has been
for insurance or guaranties of pri
vate loans. This type of commit
ment helps borrowers obtain funds
50

from private lenders at reasonable
rates of interest or over periods
long enough to make repayment
easier.
Federal credit programs have a
small effect on the budget com
pared with the large amount of
credit extended or guaranteed.
This is because insurance and guar
anties do not normally involve
budget expenditures and because
collections on direct loans in most
cases offset disbursements on new
loans. In 1957, as in 1956, collec
tions are expected to exceed dis
bursements, resulting in net re
ceipts.
Nearly 75 percent of the esti
mated total new commitments for
major Federal credit programs in
the fiscal year 1957 will be for

Federal Credit Programs
[In billions]

Fiscal year

New commitments during
fiscal year
Loans

1957 e s t ____

$4.6

1956 est_____
1955________

Guaranties

Total

Loans

$21.3

319.0 'M l

Guaranties

Total

21.3

18.8

18.9

40.3

11.8

15.9

17.8

35.5

53.3

16.5
4.1

1954________

Outstanding and committed
at end of fiscal year

1953________

5.3

10.6

15.9

19.1

30.9

50.0

1952________

5.2

9.7

14.9

17.4

27.2

44.6

housing and related programs,
and 20 percent will be for agricul
ture.
Housing programs supervised
by the Housing and Home Finance
Agency account for 9.2 billion dol
lars of the new commitments esti
mated for 1957. These include
( 1) insurance of private loans for
buying, building, or improving
homes; (2) purchase of mortgages
insured or guaranteed by Federal
agencies; (3) direct loans and
guaranties of private loans to local
public agencies for low-rent hous
ing, prevention or removal of
slums, and public facilities; and
(4) direct loans to colleges for
dormitories and faculty houses.
New commitments for loans to
veterans to be guaranteed or made
directly by the Veterans Admin
istration are expected to be 6.7 bil
lion dollars in 1957. These loans

are almost entirely to purchase or
improve houses.
Credit aids for agricultural pro
grams, supervised by the Depart
ment of Agriculture and the Farm
Credit Administration, will total
4.4 billion dollars. Major pro
grams are ( 1 ) price support loans
and guaranties; (2) farm produc
tion loans; (3) electrification and
telephone loans; and (4) loans and
insurance for farm operation and
for farm ownership and improve
ment.
Other major Federal credit pro
grams are to promote foreign trade,
to expand defense production, and
to aid small businesses and victims
of disasters. Additional credit
aids are recommended in the budg
et as part of new legislation to aid
construction of schools and health
facilities and to help redevelop
areas with chronic unemployment.
51

DETAIL OF BUDGET EXPENDITURES BY FUNCTION
[Fiscal years. In millions of dollars]
1952
actual

1953
actual

1954
actual

1955
actual

1956
esti
mated

11,478
Pay and support of active duty military
personnel _______________________ 11, 152
Operation and maintenance of equipment
and facilities__________ _________ 11,682
Military public works, research, reserves,
and other________________________
4,586
Military assistance and support__________ 2,442
Atomic energy___________________ ____
1,670
Stockpiling and defense production_______
966

17, 123

15, 958

12, 997

11, 823

11, 719

11,556

10,961

10, 643

10, 341

10, 336

10, 379

9,357

7,905

8, 351

9,100

4,553
3,954
1, 791
1,008

4,059
3,629
1, 895
1,045

3, 987
2, 292
1, 857
944

4,060
2,464
1, 7Ì5
713

4,392
2,500
1,945
378

43,976

50, 363

46,904

40,626

39,467

40, 370

Conduct of foreign affairs_______________
Foreign information and exchange activities.

2, 584
142
99

1,960
150
106

1,511
130
91

1,960
121
100

1,813
131
110

1, 841
143
124

Total, international affairs and finance.

2, 826

2,216

1, 732

2,181

2, 053

2,108

Compensation and pensions_____________
Hospitals and medical care___ ________
Readjustment benefits for education and
training____________________________
Readjustment benefits for unemployment,
loan guaranty, other_________________
Insurance and indemnities______________
Other services and administration............ .

2,178
784

2,420
757

2,482
782

2,681
727

2,818
797

2, 937
815

1, 326

659

546

664

725

726

122
216
238

138
102
223

158
100
188

150
57
178

161
110
182

168
55
178

Total, veterans’ services and benefits__

4,863

4,298

4,256

4,457

4,793

4,879

1,180
330
275
175

1,332
318
281
288

1,439
290
277
271

1, 428
275
328
321

1,490
381
395
277

1, 480
441
420
394

169

171

173

143

160

170

2,168

2,426

2,485

2, 552

2, 767

Description

1957
esti
mated

Major national security:
Department of Defense:
Procurement of aircraft, ships, tanks, and

Total, major national security_______

International a f f a i r s and
finance:

Veterans*services and benefits:

Labor and welfare:
Public assistance (payments to States to aid
needy persons)____________
Promotion of public health______________
Labor and manpower services_______ ____
Promotion of education________________
General-purpose research, libraries, and
museums_____________ ___
School lunch, vocational rehabilitation, and
other____________________
Total, labor and welfare__ ___

2, 995
. _ _ _ _ _

Agriculture and agricultural
resources:
Farm price support and related programs__
Soil bank and accompanying proposals____
Agricultural land and water resources_____

2,125

1,689

3,508

2,413

341

317

244

286

314

1,964
407
330

DETAIL OF BUDGET EXPENDITURES BY FUNCTION—Con.
[Fiscal years. In millions of dollars]
1952
actual

1953
actual

1954
actual

1955
actual

1956
esti
mated

243
143

239
109
145

217
256
150

204
236
177

223
214
212

239
213
211

1,045

2,936

2,557

4,411

3,376

3,364

998
138
30
30
68

1,078
151
34
29
72

914
165
38
32
71

765
169
43
33
71

667
211
44
42
80

624
228
47
41
91

1,264

1,364

1,220

1,081

1,045

1,031

Highways___________________________
Water transportation___ ______________
Aviation_________ ____________________
Community development and public housing.
Other aids to housing__________________
Postal service___________________ ____
Civil defense, business aids, and other..........

470
522
237
163
511
740
79

572
567
239
74
413
659
87

586
466
275
-364
-142
312
-224

647
469
253
-6 0
270
356
-312

790
567
263
103
-6 2
483
39

844
629
309
180
-221
117
213

Total, commerce and housing........ .......

2,722

2,612

909

1,622

2,182

2,071

438
368
232
176
76
80
94

442
387
185
147
137
78
98

449
93
155
160
213
78
91

431
115
164
157
142
91
101

482
335
171
189
168
126
140

479
398
224
185
185
153
133

1,464

1,474

1,239

1,201

1,611

1,757

Interest on public debt:
Marketable obligations_______________
Savings bonds_____________________
Special issues______________________
Other nonmarketable obligations_______
Interest on refunds and uninvested funds__

2,750
1,664
940
499
81

3,300
1,678
1,944
482
80

3,101
1,667
1,128
487
87

3,127
1,656
1,115
473
67

3,600
1,700
1,100
400
75

3,800
1,700
1,200
300
66

Total, interest____________________

5,934

6,583

6,470

6,438

6,875

7,066

100

225

64,270

65,865

Description

1957
esti
mated

Agriculture and agricultural
resources— Continued
Rural electrification and rural telephone
__ ________
loans_____________
Farm ownership and operation loans______
Research and other agricultural services___
Total, agriculture and agricultural
resources______________________

Natural resources:
River basin development and power______
Forests, parks, and other public lands_____
Fish and wildlife______________________
Indian lands resources_________________
Minerals and other______________ ______
Total, natural resources____________

Commerce and housing:

General government:
Financial management_________________
Retirement and other central personnel costs.
Property and records management_______
FBI, alien control, and related programs__
Claims and relief acts________________
Legislative and judicial functions________
Territories, Weather Bureau, and other___
Total, general government__________

Interest:

Adjustments and reserve for
contingencies........................... .

-857

Total, net budget expenditures_______ 65,408

74,274

67,772

64,570

N ote .— D etail may not add to totals because of rounding.

BUDGET RECEIPTS AND EXPENDITURES AND PUBLIC DEBT
[Fiscal years. In millions of dollars]
Fiscal
year
1915____
1916____
1917
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936

Surplus
or
deficit

Public
debt at
end of
year

746
-63
713
+48
1,954
-853
12,662 -9,032
18,448 -13,363
6,357
+291
5,058
+509
3,285
+736
3,137
+713
2,890
+963
2,881
+717
2,888
+865
2,837 +1,155
2,933
+939
3,127
+734
3,320
+738
3,578
-462
4,659 -2,735
4,623 -2,602
6,694 -3,630
6,521 -2,791
8,494 -4,425

-1,191
1,225
2,976
12,455
25,485
24,299
23,978
22,963
22,350
21,251
20,516
19,643
18,512
17,604
16,931
16,185
16,801
19,487
22,539
27,053

Budget Budget
receipts expend
itures
683
762
1,100
3,630
5,085
6,649
5,567
4,021
3,849
3,853
3,598
3,753
3,992
3,872
3,861
4,058
3,116
1,924
2,022
3,065
3,730
4,069

28,701
33,779

Budget Budget
receipts expend
itures

Fiscal
year
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956 est. _
1957 est..

4,979
5,615
4,996
5,144
7,103
12,556
21,987
43,636
44,475
39,772
39,786
41,488
37,696
36,495
47,568
61,391
64,825
64,655
60,390
64,500
66,300

7,756
6,792
8,858
9,062
13,262
34,046
79,407
95,059
98,416
60,448
39,032
33,069
39,507
39,606
44,058
65,408
74,274
67,772
64,570
64,270
65,865

Surplus
or
deficit

Public
debt at
end of
year

-2,777
-1,177
-3,862
-3,918
-6,159
-21,490
-57,420
-51,423
-53,941
-20,676
+754
+8,419
-1,811
-3,111
+3,510
-4,017
-9,449
-3,117
-4,180
+230
+435

36,425
37,165
40,440
42,968
48,961
72,422
136,696
201,003
258,682
269,422
258,286
252,292
252,770
257,357
255,222
259,105
266,071
271,260
274,374
274,300
273,800

N o t e . —The change in the public debt from year to year reflects not only the budget surplus or deficit,
but also changes in the Treasury’s cash balances, the effect of certain trust fund transactions, and direct
borrowing from the public of certain Government enterprises.

BUDGET EXPENDITURES BY FUNCTION
[Fiscal years. In millions of dollars]
Function

1948

Major national security------International affairs and
finance_______________ .
Veterans* services and benefits.
Labor and welfare-----------Agriculture and agricultural
resources-------------------Natural resources--------- -Commerce and housing------General government---------Interest----- -----------------Reserve for contingencies _
Adjustment to daily Treasury
statement basis

1949

1950

1951

1952

1953

1954

1955

1956
est.

1957
est.

11,771 12,907 13,009 22,444 43,976 50,363 46,904 40,626 39,467 40,370
4,566 6,053 4,674 3,736 2,826 2,216 1,732 2,181 2,053 2,108
6,654 6,726 6,646 5,342 4,863 4,298 4,256 4,457 4,793 4,879
1,322 1,563 1,963 2,065 2,168 2,426 2,485 2,552 2,767 2,995
650
1,143
2,338
1,330
5,714

1,045
1,264
2,722
1,464
5,934

-388 +272 +330 -705

-857

575
638
1,406
1,276
5,248

2,512
908
2,044
1,076
5,445

2,783
1,065
2,133
1,186
5,817

2,936
1,364
2,612
1,474
6,583

2,557
1,220
909
1,239
6,470

4,411
1,081
1,622
1,201
6,438

3,376
1,045
2,182
1,611
6,875
100

3,364
1,031
2,071
1,757
7,066
225

Total______________ 33,069 39,507 39,606 44,058 65,408 74,274 67,772 64,570 64,270 65,865
N o t e . —Detail

may not add to totals because of rounding.

UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1956

For sale by the Superintendent of Documents, U. S. Government Printing Office
Washington 25, D. C. - Price 25 cents

BRANCH

THE

GOVERNMENT

1V»3Q31

EXECUTIVE

EXECUTIVE OFFICE OF THE PRESIDENT • BUREAU OF THE BUDGET JANUARY i. t9b6

Full text of Budget in Brief : Fiscal Year 1957

FRASER