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The Federal Budget

Executive Office

OF THE

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Puoisc Library

Fiscal Year

of the President
BUREAU

BUDGET

1959

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The Federal Budget in Brief
for the fiscal year 1959
I feel confident that this budget expresses the way in which the American
people will want to respond to the promises and dangers of the dawning
age of space conquest. New dimensions must be added to our defenses,
and outmoded activities must be discarded. Closer international cooperation is vital in a world where great distances are losing their meaning.
As we devote more of our efforts and resources to these compelling tasks,
we will have to limit our demands for less essential services and benefits
provided by the Federal Government.
Our response must rise above personal selfishness, above sectional interests, above political partisanship. The goal of lasting peace with justice,
difficult though it may be to achieve, is worth all of our efforts. We must
make the necessary sacrifices to attain it. Our own people demand it and
the nations of the world look to us for leadership.
DWIGHT

EISENHOWER.

January 13, 1958

Introduction
This issue of T H E F E D E R A L B U D G E T I N B R I E F summarizes the budget for
the fiscal year 1959, which President Eisenhower sent to the Congress on
January 13,1958. For ready comparison, it also includes summary financial
data for earlier years.
The budget for the fiscal year 1959 presents the administration's financial
plan and program for the Federal Government for the fiscal year which runs
from July 1, 1958 through June 30, 1959. It also reports the results of
Government activities in the fiscal year 1957 and the latest budgetary
estimates for 1958.
The President presents his budget early in each session of the Congress
in order to provide comprehensive information on the activities for which
appropriations are requested during the current session. The budget also
shows how funds previously appropriated by the Congress are being spent,
and contains estimates of revenues and expenditures.
Of course, by the time the fiscal year ends, 18 months after the budget
is presented, many figures will inevitably have changed. The President
may change some of his requests as circumstances alter. The Congress
may modify some of the President's proposals on appropriations and taxes.
International and domestic conditions may vary from the assumptions on
which the budget was based. Also, the administration is constantly seeking new opportunities for economies and savings.

Contents
Page

Part I.

BUDGET

Part 2.

B U D G E T I N F O R M A T I O N BY F U N C T I O N

SUMMARY

Major national security
International affairs and
Labor and welfare
Commerce and housing
Veterans services and benefits
Agriculture and agricultural resources
Natural resources
Interest
General government
Part 3.

SUPPLEMENTARY

INFORMATION

Authority to incur financial obligations
Budget information by agency
Trust funds
Federal public works
Research and development
Federal aid to State and local governments
Federal credit programs
Receipts from and payments to the public
Public debt
Historical tables
GLOSSARY

SELECTED

BUDGET

TERMS

finance

16
18
20
22
24
26
28
30
32

36
38
40
42
44
46
48
50
51
52
55

Budget Summary

Fart 1

Budget Summary

Part 1 of this booklet presents
the first section of the President's
budget message for 1959. It summarizes briefly the significant totals
in the 1959 budget—expenditures,
receipts, new authority to incur
financial obligations, and unexpended balances of authority carried forward from previous appropriations. Most of these subjects
are discussed in further detail in
parts 2 and 3.

From the President's 1959 Budget Message
To the Congress of the United
States:

The budget for the fiscal
year 1959 which I am transmitting with this message
reflects the swiftly moving
character of the time in
which we live. It is clearly
a time of growing opportunity as technology and science
almost daily open wholly
new vistas to all mankind.
Yet it is also a time of growing danger. The progress of
the Soviets in long-range missiles and other offensive
weapons, together with their
continuing rejection of a
workable disarmament, compels us to increase certain of
our defense activities which
we have only recently expanded many fold.
We know that we are
sturdy today in the many
strengths that keep the peace.
This budget reflects our determination to remain so in
the future.
This budget reflects another
determination—that of adhering to those principles of
governmental
and
fiscal
soundness that have always
guided this administration—
economy in expenditures, efficiency in operations, promotion of growth and stability
6

in a free-enterprise economy,
a vigorous Federal-State system, concern for human wellbeing, priority of national
security over lesser needs,
revenues adequate to cover
expenditures and permit debt
reduction during periods of
high business activity, and
revision and reduction of
taxes when possible.
To meet the responsibilities
imposed on us by world conditions and by the fiscal principles to which we adhere,
the budget for 1959 contains
recommendations to provide:
( 1 ) An immediate increase for 1958 of $1.3
billion in spending authority for the Department of
Defense, and a further increase of $2.5 billion in
1959 over 1958, to be applied principally to accelerate missile procurement,
to strengthen our nuclear
retaliatory power, and to
spur military research and
development programs;
(2) A resulting increase
of $2.8 billion in estimated
1959 expenditures over
1957 for missiles, nuclear
armed or powered ships,
atomic energy, research
and development, science
and education, plus a fur-

ther provision of $0.5
billion for defense purposes, if needed; in addition, authority to transfer
up to $2 billion between
military appropriations, in
order to take prompt advantage of new developments ;
( 3 ) A decrease of $1.5
billion in 1959 expenditures below 1957 for other
military arms and equipment and aircraft of declining importance, in favor of
the newer weapons;
( 4 ) Curtailments, revisions, or eliminations of
certain present civil programs, and deferments of
previously
recommended
BUDGET
[Fiscal years.

new programs, in order to
restrain nonmilitary spending in 1959 and to provide
the basis for budgetary savings of several billion dollars annually within a few
years;
( 5 ) Continuation of present tax rates to help
achieve a balanced budget
in 1959I believe that this budget
adequately provides for our
Federal responsibilities in the
year ahead.
The estimated budget totals
for the current fiscal year and
for the fiscal year 1959 are
compared with actual results
of earlier years in the following table:
TOTALS
In billions]
1956
actual

Budget receipts
Budget expenditures
Budget surplus ( + ) or deficit ( — )
New obligational authority
1

1957
actual

1958
estimate

1959
estimate

$68.1
66.5

$71.0
69.4

$72.4
72.8

$74.4
73.9

+ 1.6

-.4

+ .5

63.2

70.2

74.4

72.5

Includes $6.6 billion of anticipated supplemental requests.

Defense, science, and the bud-

get.—Americans are determined to maintain our ability
to deter war and to repel and
decisively counter any possible attack. Today we pos-

sess military superiority over
any potential aggressor or
aggressors. Every American
should clearly understand
that the vast defense programs undertaken during the
7

past several years have
greatly advanced our military preparedness and developed and harnessed impressive new scientific achievements. We have sharply increased the numbers of scientists and engineers assigned
to top priority defense programs. We have expanded
many fold the expenditures
for the development of missiles, both defensive and
counteroffensive. We have
accelerated development of
advanced guidance systems,
new fuels, and heat-resistant
materials. We have greatly
enlarged our network of
warning devices and communications.
Our longer-range ballistic
missile development, in particular, has long had the
highest national priority.
The result is striking. Whereas in 1953 we spent only $1
million on these programs,
we spent $1 billion in 1957
and will spend more in 1958
and still more in 1959Our defenses are strong today, both as a deterrent to
war and for use as a crushing
response to any attack. Now
our concern is for the future.
Certain elements of our defense program have reached
the point where they can be
8

further accelerated. I will
transmit to the Congress, immediately, a supplemental appropriation request of $1.3
billion for the Department of
Defense for the fiscal year
1958. Further increases in
new obligational authority
are requested for the fiscal
year 1959. The recommended
authority for the military
functions of the Department
of Defense is $ 3 9 1 billion,
which is $0.6 billion more
than was requested in last
year's budget for 1958 and
$3.8 billion more than the
amount the Congress has thus
far enacted for 1958. Spending for military functions of
the Department of Defense in
1959 is estimated to total
$39.8 billion.
The development of longerrange ballistic missiles, construction of missile sites and
detection systems, and other
missile programs including
More Dollars for Missiles
$ Billions

4.3

3.0

1.2

1955
Fiscal Year

1956

1957

1958

1959

— — Estimate

—

guided missile ships w i l l
be substantially augmented.
The total expenditures for
missile research, development
and procurement, for guided
missile ships, and for missilerelated construction w i l l be
$4.3 billion in 1958 and $5.3
billion in 1959, compared
w i t h $3 billion spent in 1957,
$1.7 billion in 1956, and $1.2
billion in 1955. Commencing in 1958, we will procure
a number of new missiles
which have been recently developed and have now become operational.
As an indispensable part
of our efforts to maintain an
adequate defense, the budget
recommendations for 1959
call for continued contributions to the efforts of free
world nations to promote the
collective defense and economic growth. The Soviet
threat to freedom is far more
than military power alone.
Poverty and ignorance, and
the despair, fear, and unrest
that flow from them, have
always been enemies to liberty. The Communists well
know this and unceasingly
exploit these factors to extend their influence and control. This Soviet economic
assault on freedom is rapidly
growing. Conquest by this

route is no less menacing to
us and other free nations
than conquest by military
force. We must, accordingly,
vigorously advance our programs to assist other peoples
in their efforts to remove
poverty and ignorance. As
we succeed in these military
and economic efforts, our
own freedom and security
are strengthened, and the
prospects for peace are
improved.
Scientific and research
efforts throughout the Nation must be expanded. This
is a task not only for the
Government but also for private industry, foundations,
and educational institutions.
The Government, on its part,
w i l l increase its efforts in this
area. Supplemental appropriations for 1958 w i l l be
requested for the National
Advisory Committee for Aeronautics and the National Science Foundation, as well as
the Department of Defense.
For 1959, new programs to
promote education in science
are being recommended and
basic research activities are
being generally expanded.
Changes in emphasis.—Total

Government expenditures ( 1 )
for all procurement to equip
our forces and those of our
9

4 5 1 6 2 0 O — 58

allies with weapons, ships,
planes, and missiles, (2) for
atomic energy, and (3) for all
scientific research and education will be approximately
$21.1 billion in 1958 and
$21.6 billion in 1959, compared with $20.5 billion in
1957.
Within these totals for procurement and science, we
have gradually but substantially changed our emphasis.
This administration's continuing attention in recent years
to new concepts of defense is
shown by the fact that more
than 75% of the total funds
for procurement in the 1959
budget and 1958 supplemental requests is programed for
new types of equipment
which had not been developed in the fiscal year 1955 or
were not being bought in
production quantities in that
year—the first full year following the Korean conflict.
In 1953, missiles alone took
less than 2 cents of each
dollar spent for major procurement; in 1957, missiles
took about 15 cents of every
procurement dollar, and in
1959 will take about 24 cents.
The greatly increased firepower of modern weapons
and the continuing increase
in efficiency permit a further
10

reduction in the numbers of
military personnel. Procurement of older types of weapons and equipment is also
being reduced. Other defense expenditures will be
reduced by closing installations that are outmoded or
are of limited use, and by
t i g h t e n i n g maintenance
standards, procurement practices, and supply management.
Budget authorisations and expenditures.—As a result of the
increases in our key protection programs recommended
in this budget for the current
fiscal year and the coming
fiscal year, total new obligational authority and budget
expenditures for each of these
years will be larger than in
1957—even though it is recommended that certain other
BUDGET EXPENDITURES
Billions

Interest
Veterans

$7.9

$5.0
Agriculture

54.6

Major
National Security

Other

$10.6

J45.8

Fiscal Year 1959 Estimate

programs, both defense and
civil, be retarded or reduced.
Total appropriations and
other forms of new obligational
authority
recommended for the fiscal year
1959 amount to $72.5 billion.
This is $4.7 billion more than
has been enacted for 1958 and
$2.3 billion more than for
1957. In addition, $6.6 billion of supplemental authorizations are estimated for the
current year, 1958, for the
Department of Defense, Commodity Credit Corporation,
Export-Import Bank, and
other agencies.
Budget expenditures in the
fiscal year 1959 are estimated
to be $73.9 billion. This is
$1.1 billion more than now
estimated for 1958 and $4.5
billion more than in 1957.
Not all of the obligational
authority enacted for a fiscal
year is spent in the same year.
Amounts of authority enacted in prior years but which
have not yet been spent and
are carried forward from one
fiscal year to the next are
called unexpended balances.
These balances are not cash
on hand, but represent authority to draw on future
receipts of the Treasury in
order to pay bills.

The total balances of appropriations to be carried forward at the end of the fiscal
year 1959 are estimated to be
$39.9
billion.
Of
this
amount 78% will have been
obligated; that is, already
committed.
The largest part of the
unexpended balances of appropriations is in the Department of Defense, reflecting
the long time which necessarily elapses between the
placing of orders for complex
military equipment and delivery and final payment. It
is estimated that $32.1 billion will be carried forward
by that Department at the
end of 1959, of which $24.4
billion w i l l
have
been
obligated.
Budget

receipts.—Although

higher than in previous years,
the current estimate of receipts for the fiscal year 1958
is somewhat smaller than
earlier expectations, reflecting readjustments currently
taking place in our economy
following the rapid growth
of the past several years. It
now appears that 1958 budget
receipts will not exceed $72.4
billion, although they will
be well above 1957 receipts
of $71 billion. A combina-

BUDGET
[Fiscal years.
Source

Individual income taxes
Corporation income taxes
Excise taxes
All other receipts
Total

tion of increased defense expenditures and
decreased
receipts in the revised estimates for the current fiscal
year results in an estimated
budget deficit of $0.4 billion.
There are strong grounds
to support my confidence that
the expansion of our economy will soon be resumed,
bringing higher levels of receipts with present tax rates.
The acceleration of defense
efforts already under way, the
increasing pace of activity in
a number of programs involving State and local as well
as Federal expenditures, the
rapid pace of technological
advance and its application
by American industry, the
expanding needs and desires
of our growing population,
and Government policies designed to facilitate the resumption of growth are
among the major factors that
justify this confidence.
While there are many uncer12

RECEIPTS
In billionsl
1957
actual

1956
actual

1958
estimate

1959
estimate

$32.2
20.9
9.9
5.2

$35.6
21.2
9.1
5.2

$37.2
20.4
8.9
5.9

$38.5
20.4
9.3
6.2

68.1

71.0

72.4

74.4

tainties in forecasting results
18 months in advance, our
best estimate at this time of
budget receipts for 1959 is
$74.4 billion. This would
produce a balanced budget
with a surplus of $0.5 billion
in 1959.
With relatively minor exceptions, present tax rates
have not been changed since
1954 when a program of tax
reduction and reform was
enacted, saving taxpayers
nearly $7-5 billion annually.
BUDGET RECEIPTS

Billions
% x

- pp^

Corporation
Income Taxes
$20.4

'llslllll

Individual

Excise Taxes

Income Taxes

$9.3

$38.5

$6.2
Other

•

Fiscal Year 1959 Estimate

If the Congress follows my
recommendations, I believe
that we shall be able to do
what is required for our defense efforts and meet the
basic needs of our domestic
programs without an increase
in tax rates. To maintain
present rates, I recommend
that tax rates on corporation
income and certain excises,
which under existing law are
scheduled for reduction next
July 1, be extended for another year.
We shall continue our
efforts to assure that no one
can avoid paying his fair
share of the country's total
high tax burden. Pending
legislation (H. R. 8381),
which was developed jointly
by the Treasury Department

and the House Committee on
Ways and Means to remove
unintended tax benefits and
hardships, should be enacted
with a few modifications.
The Treasury Department
will continue to review the
operation of the tax laws
and make recommendations
for such additional changes
as are needed to close loopholes.
There are certain technical
tax revisions which will give
substantial benefits to small
business, with a minimum
Joss of revenue and with no
changes in tax rates. These
revisions will be set forth in
the Economic Report. They
are based on the work of the
Cabinet Committee on Small
Business.

1959 Estimated Receipts and Expenditures

1959 Estimated Receipts - $ 7 4 . 4 billion

1959 Estimated Expenditures-$73.9 billion

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45.8 Major National Security
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17.9 Interest
5.0

Veterans

4.6

Agriculture

3.7 Labor and Welfare

1.6 Commerce and Housing

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6.2 A l l Other Receipts

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1.5 Natural Resources
1.4 General Government
1.3

International

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Allowance (or Legislation
and Contingencies

Fart 2

Budget Information by Function

The bulk of the President's message following the section alreadypresented consists of a discussion of
his policies and recommendations
for each of nine major functions of
Government.
Part 2 of this booklet summarizes
new obligational authority and
budget expenditures for each of
these functions.
The charts in this section show
the 1959 estimates of expenditures
for the programs within each major
function. Budget expenditures for
these same programs over a 7-year
period are shown on pages 52 and
53.

Major National Security
$45,836 million . . . 62.0% of 1959 budget expenditures

Over the past few years, the
Defense Department has made great
strides in progressively modernizing and adding to the defensive
and counteroffensive power of the
Armed Forces. The 1959 budget
provides for accelerating these efforts, with particular emphasis on
missile programs, nuclear retaliatory forces, antisubmarine warfare
capabilities, and research and development. While expenditures for
these high priority activities will
increase, partially offsetting reductions are being effected in parts of
the military program which are of
declining importance.
Expenditures for the military
functions of the Department of
Defense are estimated to be $39.8
billion in 1959, almost $1 billion
more than in 1958.
Total procurement expenditures
will remain about the same in 1959
as in 1958. Within this total, expenditures for all types of missiles
will continue to increase rapidly
and more surface ships and submarines armed with missiles will
be built. Procurement of aircraft
and conventional weapons will
decline.
Military personnel costs will rise
in 1959, although the number of
personnel on active duty will be
reduced. The increase for personnel
stems from proposals to revise the
military pay system so as to reward
merit and technical proficiency and
to encourage men and women to
make the armed services a career.

Expenditures for operation and
maintenance will be about the same
as in the current year. Savings
from closing marginal installations
and tightening maintenance standards and procurement practices will
be offset by the increasing unit cost
of maintaining and operating new
and more complex weapons.
Military public works expenditures will provide additional facilities at airbases to allow greater
dispersal of the Strategic Air Command and to reduce the time it
takes to get SAC bombers into the
air. Improvements will be made
in our system for tracking aircraft
and missiles and transmitting immediate warning to SAC and Air
Defense Command bases. Estimated expenditures for research
and development will rise substantially, with much of the increase being devoted to missiles, a
missile defense against missiles,
outer space projects, and basic
[In millions]
Budget
expenditures

Fiscal year

1959 est. 1
1958 est
1957
1956
1955
1954
1953

$45,
44,
44,
41,
42,
47,
51,

836
871
414
825
089
872
830

New obligational
authority

$44, 298
40,995
41, 344
36, 925
34, 778
40,079
58, 976

' Figures do not reflect $500 million for defense
contingencies, which is included in the allowance
for proposed legislation and contingencies.

Major National Security
Budget Expenditures in 1959—Estimate

Department of Defense

| / 1

MILLIONS

13,753
Purchase of Aircraft, Missiles, Ships, and Other Military Equipment
10,523
Pay and Support of A c t i v e Duty Military Personnel
9,292
O p e r a t i o n and Maintenance of Equipment and Facilities
6,211
Military Public Works, Research, Reserves, and Other

Military Assistance and Defense Support

3,085

flHHH
Atomic Energy
W

2,550

Stockpiling and Defense Production
•

422

research. Funds for personnel, procurement, testing, and other costs
related to research are included in
other categories.
As part of the mutual security
program, the United States provides military assistance (military
equipment and training) and defense support (economic aid to help
maintain adequate defense forces)
to countries participating in collective defense efforts. Expenditures
in 1959 for these programs will be
about the same as in 1958, but increased appropriations are recommended tofinancenewer-type weapons for our allies.
Expenditures of the Atomic

451620 o—58

Energy Commission are estimated
to rise $250 million in 1959. The
increase in the supply of uranium
concentrates and the expanded capacity of AEC's production plants
will result in greater production
and larger operating expenditures.
Increased emphasis will be given
to research and development for
both peaceful and military purposes.
Purchases of defense materials for
the military stockpile are decreasing as more and more stockpile
objectives are completed.
The
President is proposing that the Defense Production Act be extended
for another 2 years.

International Affairs and Finance
$1,312 million . . . 1.8% of 1959 budget expenditures

Expenditures for most international affairs and finance programs
in the fiscal year 1959 are estimated
to be higher than in 1958. However, the total declines by $156
million primarily because in 1958
the Export-Import Bank has made
a substantial disbursement under a
previously authorized loan to the
United Kingdom.
As part of the mutual security
program, the United States provides assistance to help less developed countries fulfill their strong
desire for improved living standards. Our country has long recognized the compelling humanitarian
reasons for helping less fortunate
people abroad as we do at home.
Moreover, we are concerned that
the people of less developed countries strengthen their independence
and find prospects for improved
levels of living within a free
society.
The budget provides for direct
United States technical assistance
and also for contributions to the
United Nations technical assistance
programs using the funds and experts of many nations. This assistance teaches other peoples
improved ways of farming, of
producing goods, of carrying on
business and government, and of
combating diseases. Provision is
included for the new United Nations fund proposed by the United
States for resource surveys and
training and productivity centers.
The budget also provides for such

special assistance programs as our
contribution to the United Nations
Children's Fund, care of refugees,
and other requirements not covered
by development loans.
To help meet urgent needs for
economic development in less developed countries that cannot be
financed by other lending sources,
the Development Loan Fund was
authorized in the Mutual Security
Act of 1957. Projects are now
being considered and negotiations
are being started that will result in
the commitment of an appreciable
volume of loans by the end of the
current fiscal year. These loans,
which to a large extent will supplant earlier grants, will be repayable in local currencies as well as
dollars.
The Export-Import Bank makes
loans to promote foreign trade and
to finance development projects in
countries that can repay in dollars.
Since many of the Bank's expenditures for new loans are financed
from collections of interest and
principal on loans made in earlier
[In millions]

Fiscal year

1959 est..
1958 est
1957
1956
1955
1954
1953

Budget
expenditures

$1,312
1, 468
832
662.
719
765
749

New obligational
authority

$1, 615
3,292
1,131
1,101
1,182
660
471

International Affairs and Finance
Budget Expenditures in 1959—Estimate

years, its net budget expenditures
of $51 million are considerably less
than its total program. Gross expenditures of the Bank are estimated to be $562 million in 1959.
The conduct of foreign affairs
will require about the same budget
expenditures in 1959 as in 1958.
Within this total, funds are being
provided for opening some additional foreign service posts in Africa
and for strengthening consular, economic, and political work in the
Middle East and the Far East.
Information about the United
States is given to other countries by

the United States Information
Agency through various media,
such as radio, motion pictures,
libraries, and publications. The
Department of State arranges for
exchanges of leaders, teachers, specialists, and students with other
countries. The President's Special
International Program provides for
United States cultural presentations
and participation in trade fairs
abroad. For 1959, ail of these
information and exchange programs
will place greater emphasis on contact with people in Eastern Europe
and Africa.

Ill

Labor and Welfare
$3,643 million . . . 4 . 9 % of 1959 budget expenditures

Expenditures for labor and welfare programs are estimated to be
$200 million more in the fiscal year
1959 than in 1958. The increase
is primarily for scientific research
and education.
Four-fifths of labor and welfare
expenditures are for grants-in-aid
to States and local governments,
and cannot be reduced without
changes in basic authorizing legislation. Revisions are being proposed in the laws governing five of
these grant programs which will
lead to some small budget reductions in 1959, and to some larger
reductions in later years.
Public assistance grants to help
finance payments to the aged, the
dependent, and the disabled continue to increase because of successive amendments increasing the
Federal share. Legislation is recommended to modify the formula
for Federal participation in financing these grants. This legislation
should take effect in I960 to assure
that the States will have opportunity to adjust their finances, thus
preventing an adverse impact on
the 5 million needy recipients.
Expenditures for health programs
have increased sharply since 1955,
especially for the research activities
of the National Institutes of Health.
Health programs also include Indian health services, assistance to
States for community health services, and grants for construction
of hospitals and waste treatment

plants. Legislation is proposed
to continue the hospital grants
after the fiscal year 1959 for
specialized needs. Likewise, legislation is proposed to make certain
revenues available to the States so
that the Federal Government can
discontinue waste treatment grants
in 1960.
The Government has provided
grants since 1950 to help build and
operate schools in districts where
enrollment is swelled by Federal
activities. Legislation is proposed
to continue this program but with
financial assistance being gradually
reduced over a period of years so
that it ultimately would cover only
instances where Federal personnel
both live and work on Federal
property. Legislation is also recommended for revenue credits to
States so that Federal aid for vocational education can cease in 1960.
The budget provides increased
grants to States to handle unemployment compensation claims
promptly and to maintain an effec[In millions]

Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget
expenditures

$3, 643
3, 443
2,966
2,776
2,552
2,485
2,426

New obligational
authority

$3, 616
3, 571
3,189
2, 860
2,614
2,429
2,456

Labor and Welfare =
Budget Expenditures in 1959—Estimate

MILLIONS

1,809
Public Assistance (Payments t o States t o A i d N e e d y Persons)

633
Promotion of Public H e a l t h

460
Promotion of Education

420

Labor and Manpower Services

119
Promotion of Science, Research, Libraries, and Museums
202
School Lunch, Vocational Rehabilitation, and Other

tive employment service system.
It also recommends funds for the
Department of Labor to help meet
the demand for technicians and
skilled workers.
The National Science Foundation
will greatly expand its programs
for support of basic research and
for improving and extending science
education. In addition, legislation
is recommended to authorize a

temporary 4-year program for the
Department of Health, Education,
and Welfare to provide matching
grants to States for strengthening
education, particularly in science
and mathematics.
Expenditures in 1959 for school
lunch, vocational rehabilitation
programs, and other welfare activities will continue at about the same
level as in 1958.

IV.

Commerce and Housing
$1,627 million . . . 2 . 2 % of 1959 budget expenditures

Net expenditures for commerce
and housing programs are expected
to decline $519 million from 1958
to 1959. The principal reductions
result from proposed legislation to
increase postal rates and from
termination under existing law of
the authority of the Veterans
Administration to make direct
loans for housing.
Expenditures by the Civil Aeronautics Administration will increase sharply in 1959 as new
equipment is installed and operated
so that our airways can handle
more air traffic. Research in aerodynamics will be expanded under
the National Advisory Committee
for Aeronautics. Other expenditures for aviation include grants to
help finance improvement of civil
airports and subsidies to local
service airlines. New taxes on jet
fuels and increased taxes on aviation gasoline are recommended to
help pay for the rising cost of
Federal aids to aviation.
The Federal Housing Administration will handle applications for
insurance of loans on an estimated
650,000 housing units in 1959.
Receipts, mainly from premiums,
will exceed expenditures by $80
million. The Federal National
Mortgage Association is committed
to purchase a substantial volume
of insured mortgages on housing
built for members of the armed
services, on cooperative housing,
and on housing for other groups
which cannot obtain private financ-

ing. The President is recommending that laws be amended to encourage private purchases of these
mortgages. The Federal Government now makes grants for twothirds of the cost of buying and
clearing land for urban renewal
projects. The budget provides
funds for this growing activity but
recommends that beginning in I960
the States and localities gradually
increase their proportion of the
financing to 50% by 1962.
Direct loans for college dormitories have been increasing partly
because of subsidized interest rates.
Legislation is proposed to encourage private financing by providing Federal guaranties of college
housing bonds which do not have
Federal tax exemption. Direct
Government loans would not be
made where private loans were
available at reasonable rates.
Other housing expenditures go to
[In millions]

Fiscal year

1959
1958
1957
1956
1955
1954
1953

est. 1
est

Budget
expenditures

$1, 627
2, 146
1,453
2,028
1,502
814
2,502

New obligational
authority

*$2, 061
4,026
3, 852
4,526
2,815
2,374
3, 486

1 Figures include proposed postal rate increase,
but do not reflect proposed postal pay increase,
which is included in the allowance for proposed
legislation and contingencies.

Commerce and Housing.
Budget Expenditures in 1959—Estimate
f

help local authorities finance lowrent public housing.
The Coast Guard maintains navigation aids, makes safety inspections, and carries on other activities
in the field of water transportation.
The Maritime Administration provides subsidies for construction and
operation of American merchant
ships in. foreign trade. A review is
being made of our maritime legislation with the aim of reducing future
Government subsidies.
In every year since World War
II, the postal service has incurred
large deficits that have been paid
by the taxpayers. In 1959 expenditures for postal service will be an

MILLIONS

estimated $684 million more than
postal receipts under present legislation. In the budget, the President urges enactment of legislation
to raise postal rates and calls for
adjustments in the pay of postal
employees. The net result would
be a substantial reduction in expenditures.
The budget includes the first
year cost of proposed legislation for
grants to States and localities to
strengthen civil defense, and also
provides for an expansion in warning networks and in research and
training in civil defense problems.
It also recommends extension of
the Small Business Act.

Veterans Services and Benefits
$5,012 million . . . 6 . 8 % of 1959 budget expenditures

Federal services and benefits
available to our 23 million veterans
and their dependents account for
approximately 20% of all budget
expenditures other than for major
national security.
Expenditures for 'some of these
programs are declining as veterans
of the Korean conflict complete
their readjustment to civilian life.
However, the long-run outlook under present laws is for large and increasing expenditures for veterans
programs, as costs for pensions for
needy veterans continue to rise.
The President recommends that
these laws be reconsidered, particularly in view of the growing
general public benefit and welfare
programs which are now available
to veterans as well as to other
groups of the population. Accordingly, a special message is
being sent to the Congress proposing adjustments and improvements
in veterans benefit programs.
Compensation benefits of over $2
billion will be paid to 2.4 million
individuals and families in 1959 for
disability or death resulting from
military service. The number of
beneficiaries is declining somewhat,
but expenditures will be higher
than in 1958 because of legislation
raising benefit rates by 10% to 30%
effective October 1, 1957. Pensions of over $1 billion for disabilities and deaths not connected with
military service will be paid to 1.4

million veterans and families of
veterans. The pension rolls are
increasing as veterans, particularly
of World War I, advance in age
and face increased hazards to health
and income.
Operating expenditures for hospital and medical care will amount
to $804 million in the fiscal year
1959.
Construction, modernization, and repair of facilities will
result in additional expenditures of
$36 million. The budget makes
provision for a daily average of
110,900 patients in hospitals and
16,600 residents in domiciliary
homes directly operated by the
Veterans Administration. The VA
will also pay for hospitalizing an
average of 3,000 patients a day in
other hospitals and for half the cost
of caring for 9,200 veterans in State
soldiers' homes. In addition, the
estimates for 1959 allow for the
operation of 70 outpatient clinics
providing medical and dental care.
[In millions]

Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget
expenditures
$5, 012
5, 034
4,793
4,756
4,457
4,256
4,298

New obligational
authority
$4, 996
5,013
4,870
4,823
4,369
4, 272
4,132

Veterans Services and Benefits
Budget Expenditures in 1959—Estimate

MILLIONS

3,232
Compensation and Pensions

840
Hospitals and M e d i c a l Care

626
Readjustment Benefits for Education and Training

111

Readjustment Benefits for Unemployment, Loan Guaranty, and Other

40
Insurance and Indemnities
163
Other Services and Administration

Education and training is the
chief readjustment aid provided to
veterans of the Korean conflict.
Average enrollments and expenditures reached a peak in the fiscal
year 1957 and are expected to decline in 1958 and 1959. By June
30, 1959, an estimated 42% of
Korean veterans will have participated in this program.
The size of the veterans loan
guaranty program in 1959 will be
reduced because World War II
veterans will no longer be eligible
after July 25, 1958. Veterans of

451620 O — 5 8

the Korean conflict will be eligible
until 1965. It is expected that
55,500 loans for homes, farms, and
businesses will be guaranteed in
1959. Budget expenditures, which
result from defaults on guaranteed
loans, are ultimately largely offset
by recoveries from the sale of the
defaulted property.
The general operating expenses of
the VA will be reduced more than
5 % in the coming year. These
savings result from numerous administrative improvements and
from declining workloads.

VI.

Agriculture and Agricultural Resources
$4,601 million . . . 6 . 2 % of 1959 budget expenditures

Over two-thirds of the expenditures estimated for agricultural programs in the fiscal year 1959 will be
for farm price support operations of
the Commodity Credit Corporation and related programs to improve income of farmers. Expenditures for these programs have
averaged over $3.5 billion per year
during the past 3 years, and under
present laws would be likely to
continue at high levels.
The present system of price supports has tended to stimulate a
continued high level of farm production, despite the severe restrictions imposed on farmers by production and marketing controls.
It has also speeded up the technological revolution that has been
taking place on American farms,
with the result that production per
farm worker has doubled in the last
15 years. In carrying out its commitments to support farm prices,
therefore, the Government has become the market for huge quantities of farm products.
Changes in price support legislation are being proposed in a special
message to the Congress. The
changes permitted by the proposed
legislation would not be applicable
before the 1959 crop year. They
would be applied gradually and
would not begin to affect the budget
significantly before the fiscal year
1960.

The President is also recommending that the acreage reserve part of
the soil bank be discontinued after
the 1958 crop year. On the other
hand, the budget provides for an
increase in the conservation reserve
part of the soil bank, reflecting the
belief that more benefits will result from this program per dollar
spent.
Substantial Federal expenditures
are also being made for other programs to conserve agricultural land
and water resources. These include cost-sharing payments under
the regular agricultural conservation program of the Department of
Agriculture and the special program for the Great Plains, financial
aid for watershed protection projects, and technical assistance to
farmers from the Soil Conservation
Service. The budget proposes a
reduction to $125 million in the
advance authorization for the agricultural conservation program,
[In millions]
Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget
expenditures
$4,601
4, 924
4, 582
4, 913
4,411
2,557
2,936

New obligational
authority
$3, 849
6, 393
5, 298
3, 310
2, 672
4,010
1, 333

Agriculture and Agricultural Resources
Budget Expenditures in 1959—Estimate

MILLIONS

3,253
Farm Pricc Support and Related Programs

491
Agricultural Land and W a t e r Resources

376
Rural Electrification and Rural Telephone Loans

202
Farm Ownership and Operation Loans

279
Research and O t h e r Agricultural Services

which, with other public efforts
in support of conservation, will
provide for the more permanent
soil and water conservation practices needed to maintain an adequate agricultural resource base.
This reduction would apply to the
1959 crop year and will not affect
1959 expenditures.
Reductions in new authority are
proposed in the budget for direct
loans by the Rural Electrification
Administration and the Farmers'

Home Administration. Legislative
changes are being recommended to
assist electrification and telephone
borrowers to obtain financing from
private sources and to encourage
private investors to make more
insured real estate loans.
The budget also recommends increases for industrial-use research,
which is expected to broaden farm
markets and provide new uses for
farm products both at home and
overseas.

VII.

Natural Resources
$1,492 million . . . 2 . 0 % of 1959 budget expenditures

With due regard to the effectiveness of natural resource programs in
contributing to national security
and long-term economic growth,
the budget recommendations contemplate the greatest possible economy in the use of Federal dollars
for these programs. Increased financial participation by State and local
agencies and private interests in
conservation and development programs should be encouraged. Such
participation multiplies the effectiveness of Federal Government expenditures for these programs.
Expenditures for conservation
and development of water resources
by the Bureau of Reclamation and
the Army Corps of Engineers make
up almost three-fifths of budget
expenditures for natural resources.
Construction activities of these two
agencies for flood control, navigation, irrigation, water supply, and
power projects will be limited in
1959 to orderly continuation of
work on 309 projects started in
prior years. Expenditures in 1959
will be greater than in any of the 5
preceding years because of the very
high level of commitments on
projects already underway. To
avoid adding to these commitments
at this time, no new project starts
are proposed in the budget for 1959.
The budget includes authority,
under proposed legislation, for the
Tennessee Valley Authority to fi-

nance the construction of new
power generating facilities through
the sale of revenue bonds. This
reflects the President's recommendation that appropriate revenuebond legislation be enacted.
Construction on the Saint Lawrence Seaway will be largely completed in 1959.
The 1959 budget provides for
management of the range, forest,
and mineral resources of the 468
million acres of public lands in the
United States and Alaska which
are under the control of the Bureau
of Land Management. It also includes funds for the Bureau of
Indian Affairs for managing the
resources of the 56 million acres of
Indian lands and for the construction of roads, irrigation systems,
schools and other buildings needed
for Indians.
Our national parks, national
forests, and fish and wildlife re[ I n millions]

Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget
expenditures
$1, 492
1,457
1,296
1,104
1,202
1, 315
1, 476

New obligational
authority
$1,446
1, 439
1, 355
1, 213
1,070
1,398
1,503

Natural Resources
Budget Expenditures in 1959—Estimate

General Resource Surveys and Other

sources offer recreational opportunities for many millions of our
citizens. Progress will continue to
be made in 1959 on the development
program of the National Park
Service to meet the needs of an
estimated 80 million visitors to the
parks in 1966, and on the program
for recreational facilities in the
national forests. The 1959 budget
also provides funds for the maintenance of fish propagation stations
and wildlife refuges, for research
on waterfowl and wildlife management, for assistance to commercial

fisheries, including marketing and
technology, and for cooperation
with the States on fish and wildlife
restoration.
Funds are included in the budget
for the Bureau of Mines to continue
activities in 1959 for conserving,
evaluating, and developing our
mineral resources, and for the
Geological Survey to continue field
studies, mapping, research, and
other work related to the discovery, conservation, and management of the Nation's natural
resources.

VIII.

Interest

$7,869 million . . . 10.6% of 1959 budget expenditures

Interest payments by the Federal
Government are almost all for interest on the public debt. A relatively minor proportion is required
for interest on refunds of taxes and
for interest on uninvested funds
held by the Treasury.
The amount of annual interest on
the public debt depends on the size
of the debt and the interest rates
paid on Government securities.
The public debt was reduced in
the fiscal years 1956 and 1957 and
these reductions are resulting in interest savings of about $100 million
a year at present interest rates.
However, heavy private and local
government demand for credit to
finance record levels of capital investment have caused market rates
of interest to rise steadily during
the past several years. Over this
period, these higher rates have increased the budget cost of refinancing the large volume of maturing
Government obligations.
Thus,
interest expenditures have risen
despite the reduction in the debt.
In recent months interest rates
have declined and interest payments
in 1959 are expected to be at about
the same level as in 1958.
Interest payments on marketable
obligations, mainly held by finan-

cial institutions, are over one-half
of all interest payments. The refinancing of short-term maturities
reflects promptly changes in market
rates of interest, and the 1959
budget estimate is based on the
changed outlook for these rates.
United States savings bonds bear
an interest rate that is higher than
the average rate usually paid on the
total public debt and carry favorable redemption privileges. Nearly
one-fifth of the interest on the
public debt is payable to the
investors who hold these bonds,
mostly individuals.
Special issues of nonmarketable
securities are owned by Government trust funds and certain Government corporations which invest
their reserves against future needs.
The interest rate on a large portion
of these issues is the average rate
[In millions]
Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget expenditures

$7, 869
7,867
7,308
6, 846
6,438
6,470
6,583

Interest
Budget

Expenditures

1959—Estimate

Interest on Public Debt

ffify^'

MILLIONS

4,700

Marketable Obligations

1.500
Savings Bonds

1,300
Special Issues

300
S
Other Nonmarketable Issues

Interest on Refunds and Uninvested Funds

for longer term marketable securities. For a few special issues the
rates are specified by law.
The Congress does not make
annual appropriations for interest

payments. Since these payments
are fixed obligations of the Government, expenditures for interest
have been authorized by permanent
law.

IX.

General Government
$1,403 million . . . 1 . 9 % of 1959 budget expenditures

Expenditures for general government activities, primarily for central administrative costs not allocated among the other major
activities, will be held to about
the 1958 level despite increases in
workload accompanying the estimated 3 million annual population
growth.
The Internal Revenue Service
expects to handle 96.5 million tax
returns from individuals and corporations during the fiscal year 1959.
Other major tasks of the Treasury
Department include selling bonds
and managing the public debt,
writing checks to pay the bills of
most Government civil agencies and
trust funds, minting coins and
engraving currency, and collecting
duties on imports. Auditing by
the General Accounting Office is
another important part of financial
management.
Office space for most Federal civil
agencies, except the Post Office
Department, is provided by the
General Services Administration,
which also does central purchasing
of supplies and maintains Government records and archives. The
Government is obtaining new
buildings under lease-purchase contracts that provide for transfer of
ownership from private builders
after payment of rent for a number
of years. The President is recommending extension of the legislation providing for such contracts.
The Federal Bureau of Investiga-

tion is expected to experience an
increase in its work of investigating violations of Federal statutes.
The Immigration and Naturalization Service will also have more
work as a result of amendments enacted in 1957 to the immigration
laws. However, the Department of
Justice anticipates that improved
procedures will enable it to meet
these responsibilities without a
corresponding rise in its budget.
Construction work will continue
on office buildings for the Senate
and the House of Representatives
and work is expected to start on
remodeling the Capitol. Expenditures for this construction are
included with other costs of the
legislative branch. In accordance
with the law, the budgets of the
legislative and judicial branches of
the Government are not subject to
review by the President.
The Civil Service Commission
supervises the operation of the
merit system for Federal employ[In millions]

Fiscal year

1959 est
1958 est
1957
1956
1955
1954
1953

Budget
expenditures

$1, 403
1, 377
1, 789
1, 629
1, 201
1,239
1, 474

New obligational
authority

$1, 362
1, 368
1, 833
1, 595
1, 138
1,074
1, 368

General Government
Budget

Expenditures

1959—Estimate

95
District of Columbia, Territories, and Possessions
63
W e a t h e r Bureau and Other

ment and also administers the civil
service retirement system.
The
President is recommending the enactment of legislation to authorize
training of Government employees
outside as well as within their
employing agencies, and to require
each employing agency to bear its
share of the costs of accident compensation benefits now paid by the
Department of Labor. The Department of Labor also pays for unemployment compensation of Federal
employees who are laid off.
The President is recommending
adjustments in the pay system fot
civilian employees. The primary
objective of the proposals is more

adequate compensation for those
whose salary is substantially less
than their responsibilities. Salary
rates for junior and intermediate
scientific and managerial personnel
should be more nearly competitive
with non-Federal rates in order to
retain competent people in Government service. The amounts needed
to cover the proposed pay revision
for all agencies except the Department of Defense are included in the
allowance for proposed legislation
and contingencies. The budget for
the Department of Defense, the
Government's largest employer,
makes allowance for its share of
the additional cost.

Budget Expenditures

Per Capita

Actual Prices
Constant Prices*

Peak W a r Year.

$469
fffiL

$394

$399

$409

1954

1955

1956

1957

$421

1958

1959

$68
Fiscal

1939

Years
*

A d j u s t e d to N o v e m b e r 1 9 5 7 W h o l e s a l e Prices

1953

— Estimate —

Part 3

Supplementary Information

Part 3 of this booklet presents
information on new authority to
incur obligations and on unexpended balances. It summarizes
budget information by agency, and
also presents summary data for certain Federal activities, such as public
works and aid to States and local
governments, which are common to
many of the agencies and are parts
of the functions discussed in part 2.
In addition, part 3 provides information on other aspects of Government financial operations, such as
the Federal trust funds and credit
programs, and includes historical
data on the public debt and on
budget receipts and expenditures.

Authority To Incur Financial Obligations
Before any Federal funds can be
spent, the Congress must grant
specific authority. Under such authority, Government agencies may
incur financial obligations by employing workers, ordering supplies,
and entering into contracts. They
may also draw funds from the
Treasury to liquidate these obligations when services are performed
or goods are delivered.
The total amount available to
Government agencies for expenditure in any particular fiscal year
consists of the new obligational
authority approved by the Congress for that year plus available
authority enacted for prior years
but still unspent. Together, the
new and old obligational authority
which will be available for expenditure in the fiscal year 1959 are esti-

mated to be $141.7 billion. Nearly
half of this amount will be authority carried over from prior years.
From the available $141.7 billion,
budget expenditures estimated to
amount to $73-9 billion will be
made in 1959. Approximately
$49-7 billion of this spending will
go to pay for obligations incurred
under the new authority enacted
for 1959. These obligations will
be for such items as salaries earned
and paid during 1959, and for
supplies and equipment which are
both ordered and delivered in that
year.
The rest of the expenditures,
$24:2 billion, will be mainly for
construction and for major military
equipment such as jet bombers,
guided missiles, and submarines
which were ordered under obliga-

Total Authorizations Available in 1959 - Estimate
Expenditures
in 1 9 5 9

$141.7 billion

$73.9 billion

Unexpended Balance
carried into I 9 6 0

$67.2 billion
22.8

New O b l i g a t i o n a l
Authority for 1 9 5 9 . .

Expiring

Balance

.6*

brought into 1 9 5 9 . . . .
44.4

tional authority enacted in prior
years, but which will not be
delivered until 1959. Similarly,
part of the new obligational authority enacted for the fiscal year
1959 will be committed to procure
ships or to make contracts for construction, and it may be 1 or 2
years or more before payments are
finally made for these "long leadtime" items.
Amounts of enacted obligational
authority which have not yet resulted in expenditures and are carried forward from one fiscal year
to the next are called unexpended
balances. These balances are not
cash on hand, but represent authority to draw on the Treasury as
needed to pay bills. The total of
such balances carried forward into
the fiscal year 1959 is estimated to
be $69.2 billion.
In some cases, such as the Federal
Deposit Insurance Corporation
which insures bank deposits, the
unspent balances represent standby
UNSPENT

BALANCES

OF A U T H O R I T Y

or emergency obligational authority which the Government does not
anticipate having to exercise in the
foreseeable future. However, the
major part of the unspent balances
which are brought forward into a
particular fiscal year are balances of
appropriations for programs currently underway.
At the present time, most of the
unspent balances of appropriations
are obligated; that is, they are
amounts largely committed to pay
bills which will come due upon
completion of contracts already
signed or, in some cases, they are
amounts now owed by the Government for services or deliveries
recently received.
The administration has acted to
reduce the amount of balances to
the extent sound management allows. Unexpended balances of appropriations will have been reduced
from $78.4 billion at the close of
the fiscal year 1953 to an estimated
$39.9 billion by the end of 1959.
CARRIED

[Fiscal years.
Description 1

From appropriations
From other authorizations:
Authorizations to spend from
debt receipts
Contract authorizations
RevoJving and management
funds
Total
1

1953

FORWARD

END

YEAR

In billions]

1954

1955

1956

1957

1958
1959
estimate estimate

actual

$78.4

$67.7

$52.1

$46.0

$43.7

$40.1

$39.9

20.2
2.5

21.1
2.5

19.5
2.6

18.9
4.0

20.7
1.0

24.0
1.5

22.8
1.5

1.7

2.9

5.4

4.1

3.4

3.6

3.0

102.8

94.2

79.6

73.0

68.8

69.2

67.2

See glossary for definitions of items.

Budget Information by Agency
New obii gattonal authority by
agency.—In the usual case, an appropriation bill passed by Congress
grants authority to a specific agency
to incur obligations.
Consequently, in order to follow the
progress of the budget through
Congress, it is important to have
budget information classified by
agency. In a few instances, such
as the mutual security program for
which major responsibility is
shared by two or more agencies,
appropriations are made to the
President and are then allocated
by him among the agencies.
The Department of Defense accounts for more than half of all
new obligational authority recommended for the fiscal year 1959.
The second largest amount is for
the Treasury Department, largely
for paying interest on the public
debt for which no annual action
by the Congress is required.
New obligational authority in
excess of $2 billion each is also
recommended for the Department of
Agriculture, the Veterans Administration, the mutual security program, the Department of Health,
Education, and Welfare, and the
Atomic Energy Commission.
Gross and net expenditures by
agency.—In addition to the funds
they receive under appropriations
from the Congress, a number of
agencies that are engaged in business-type operations collect funds

directly from customers or clients.
For example, the Post Office Department collects money from the
sale of stamps and other services,
and the Department of Agriculture
receives collections on loans or payments for farm commodities it
sells.
Some business-type operations of the Federal Government
are organized as corporations;
others, such as the Post Office, are
not.
Agencies which receive directly
the receipts from their operations
are usually authorized to spend
both their appropriated funds and
their receipts. The true scale of
their activities, therefore, is measured by their gross expenditures.
However, their net expenditures,
calculated by subtracting the applicable receipts from gross expenditures, are the amounts which
directly influence the size of the
budget deficit or surplus.
Receipts by the Post Office Department are expected to account
for more than one-third of all
agencies' receipts from operations
in the fiscal year 1959. Postal
revenues are estimated to be higher
in the coming fiscal year than in
1958, mainly because of the increases in postal rates recommended
by the President to cover more
nearly the costs of providing postal
service.
The next largest amount of receipts from operations is expected

EXPENDITURES

AND

NEW

OBLIGATIONAL

(Fiscal year 1959 estimate.

Description

Legislative branch
The judiciary
Executive Office of the President
Funds appropriated to the President:
Mutual security
Other
Independent offices:
Atomic Energy Commission
Veterans Administration
Other
General Services Administration
Housing and Home Finance Agency
Department of Agriculture
Department of Commerce
Department of Defense:
Military functions
Civil functions
Department of Health, Education, and Welfare
Department of the Interior
Department of Justice
Department of Labor
Post Office Department
Department of State
Treasury Department
District of Columbia
Allowance for proposed legislation and contingencies
Total
1

AUTHORITY

AGENCY

In millions]

Qross expenditures

Receipts
from
operations

$126
46
12

Budget expenditures

$126
46
12

$2
71

3, 868
302

1, 970
7, 888
824

137
945
5
1, 515
2,907
21

2, 550
4, 977
745
413
455
4, 981
803

39, 832
791

53
90

39, 779
701

2, 857
703
228
458
3, 479
228
8,606
38

3
40

2,854
663
228
452

3,870
373
2,550
5,114
1,690
418

6
3, 495
15

1,139
83, 240

-16

228
8, 591
38
1,139

9,305

73, 934

Less than one-half million dollars.

NOTE.—Detail may not add to totals because of rounding.

to be realized by the Department
of Agriculture, primarily from collections on loans and sales of commodities acquired under price-support operations of the Commodity

Credit Corporation. The Housing
and Home Finance Agency will
also have substantial receipts, reflecting collections on loans previously made by the Agency.

Trust Funds
Each year, a substantial amount
of money is collected by the Federal
Government and held in trust for
later payment to private individuals
or to State and local governments.
Because these funds are not available for general purposes of government, they are not included in
budget receipts and expenditures,
and transactions of these funds
therefore do not affect the budget
surplus or deficit.
Trust fund receipts in the fiscal
year 1959 are estimated to be $16.6
billion and trust fund expenditures
$16.4 billion. Both receipts and
expenditures of trust funds have increased substantially since 1953,
reflecting both the creation of new
trust funds and the steady growth
in the size of older trust funds.
The social security and retirement trust funds are financed mainly
from payroll taxes paid by employers and employees. Payments from
these funds are for benefits to the
unemployed, the aged, the disabled,
and survivors of insured persons.
Expenditures for old-age and survivors insurance are expected to
exceed receipts in 1959 because of
recent liberalizations in benefits.
An increase in payroll taxes
scheduled under existing law for
January 1, 1960, will again raise
receipts of this fund above expenditures.
Receipts of the highway trust
fund come from excise taxes paid

by highway users; expenditures of
the fund are primarily grants to
States to assist in building the
Federal-aid highway systems. In
the fiscal year 1959, disbursements
of the fund are estimated to exceed
receipts for the first time. This
excess will be financed by using
part of the balance accumulated in
earlier years.
The 1959 budget contains several
proposals concerning the highway
trust fund. These would (1) transfer from the general fund to the
trust fund the financing of forest
and public lands highway programs
in the Department of Commerce,
since most of these highways are
on one of the Federal-aid systems,
(2) retain in the general fund receipts from aviation gasoline taxes,
which now go into the trust fund,
to help finance the operations of the
airways, and (3) provide for payment from the trust fund of the
expenses incurred by the Treasury
in collecting taxes going into the
trust fund.
Other trust funds include the
secondary market operations of the
Federal National Mortgage Association. The estimated excess of
expenditures over receipts for 1959
in the category of '' all other trust
funds" reflects mainly the mortgage
purchases by the Association.
These purchases are expected to
result in net trust expenditures of
$0.3 billion in 1959.

Trust Funds
Fiscal

Year 1959

RECEIPTS A N D

EXPENDITURES

Estimate

t BILLIONS

•7.9
O l d - A g e and
Survivors Insurance

8.7

Expenditures

Federal-aid
Highways

Unemployment
Insurance

Federal Employees
Retirement

Federal Disability
Insurance

Railroad

Trust Funds
[In billions]

Retirement
Fiscal year

Total
receipts

Total
expenditures

Veterans

1959 est

316.6

$16.4

Life Insurance

1958 est

16.4

15.2

1957

14.4

13.0

1956...

11.7

9.4

1955.

9.5

8.5

A l l Other

1954

9.2

7.2

Trust Funds

1953.

8.9

5.3

Federal Public Works
Expenditures for military public
works are estimated to be about
$140 million higher in the fiscal
year 1959 than in the current year.
A substantial portion of these expenditures will be for the dispersal
of the Strategic Air Command to
additional bases and for the construction of additional facilities
such as runways and fueling stations. The 1959 construction proBUDGET

AND

TRUST

FUND

gram of the Department of Defense
also includes facilities for the ballistic missile detection system and
the related communication lines.
In the coming fiscal year the
Atomic Energy Commission will
continue construction already underway on experimental reactors
for power propulsion and supporting facilities for reactor development, and on four high energy

EXPENDITURES

[Fiscal years.
Program

Major national security public works:
Budget expenditures:
Military and related public
works
Atomic energy plants and facilities
Total, major national security public works
Civil public works:
Budget expenditures:
Federal construction
Grants to State and local governments
Loans to State and local governments (net)
Trust fund expenditures:
Federal construction
Grants to State and local governments

FOR PUBLIC

WORKS

In billions]

1953
actual

1954
actual

actual

1955

1956
actual

1957
actual

$1.9

$1.7

$1.6

$2.1

$2.0

$2.1

1.1

3.0

2.8

2.4

2.3

2.2

2.3

1.4

1.3

1.0

1.1

1.3

1.5

-.4

— .1

( 0

1.0

1.8

2.3

1958
1959
estimate estimate

Total, civil public w o r k s . . .

2.2

1.6

1.7

1.8

2.2

3.5

4.3

Total, Federal public works.

5.2

4.4

4.1

4.5

5.7

6.7

i Less than $50 million.
NOTE—Detail m a y not add to totals because of rounding.

Federal Public Works =====
Budget and Trust Fund Expenditures in 1959—Estimate

MILLIONS

2,104
M i l i t a r y a n d R e l a t e d Public W o r k s
233
A t o m i c Energy Plants and

Facilities
2,439

H i g h w a y s a n d Roads

978
W a t e r Resources and R e l a t e d

Developments

225
Schools a n d

Hospitals

Expenditures

Trust Fund

202
Aviation

Budget

Expenditures

Facilities

484
Buildings a n d O t h e r Facilities

particle accelerators in the multibillion electron-volt range. In addition, improvements are planned
in production facilities for fissionable materials and weapons.
Construction in the fiscal year
1959 on some Federal civil public
works projects will be stretched
out where this can be done effectively. In view of the high level
of commitments made in the last
few years, the budget makes no
provision for starting any new
water resources projects in 1959 by
the Corps of Engineers and the
Bureau of Reclamation. New authorizations for other civil public
works programs, such as grants for
hospital construction and for con-

struction of schools in federally
affected areas, are being reduced.
However, total expenditures for
civil public works are expected to
be higher in 1959 than in the current year, primarily because of the
expanding Federal-aid highway
program, financed through a trust
fund, and because of commitments
made for direct Federal projects
started in previous years.
Construction for the Federal
Government accounted for about
6 % of all new construction in the
United States in the fiscal year
1957. Public works of State and
local governments that are carried
on with aid from the Federal Government represented another 4 % .
43

Research and Development
Nearly one-half of the Nation's
total expenditures for research and
development is spent by the Federal
Government. In the fiscal year
1959, expenditures of Federal agencies for these purposes will be increased by 9 % , with emphasis on
basic research and defense needs.
Federal expenditures directly appropriated for the conduct of research and development are estimated to be $3.4 billion in 1959,
an increase of $348 million over
the current fiscal year. In addition, $337 million is estimated for
research facilities. If expenditures
from procurement appropriations
for weapons testing and evaluation
in the Department of Defense are
added to this total of $3.7 billion
from research and development accounts, total Government expenditures for these purposes are estimated to exceed $6 billion in 1959.
Over 80% of the Federal research
and development expenditures are
made by the Department of Defense
and the Atomic Energy Commission. While these are primarily
for national security purposes, a
substantial contribution is also
made through such research and
development to the civilian needs
of the Nation.
Research and development expenditures by the Department of
Defense are estimated to rise by
$162 million in 1959. Work on
missiles, both defensive and counteroffensive, is being expanded, and
basic research activities are being
increased.

Expenditures of the Atomic
Energy Commission will increase
in 1959 for both military and nonmilitary research and development.
The program includes basic research
in nuclear aspects of physical and
life sciences.
Applied research
activities will be increased and
concentrated on naval and other
military propulsion reactors, and
on developing reactors to produce
safe and economic electrical energy
for civilian use.
The research programs of the
Department of Health, Education,
and Welfare will continue at a high
level in 1959. There has been a
substantial expansion of medical
research under the Public Health
Service in recent years. Increased
expenditures are estimated in 1959
for construction of medical research
facilities under a program of grants
to institutions started in 1957.
B U D G E T E X P E N D I T U R E S FOR RESEARCH
AND

DEVELOPMENT
[In millions]

Fiscal year

1959 est.1
1958 est.1
1957 1
1956 1
1955
1954
1953

Total

Major
national
security

$3,722
3, 427
3,027
2,538
2,085
2,085
2,100

$3,093
2,886
2,596
2,202
1,804
1,806
1, 830

Other

$629
541
431
336
281
279
270

i Includes pay and allowances of military personnel assigned to research and development activities: 1959, $194; 1958, $193; 1957, $196; 1956, $188.

Research and Development
Budget Expenditures in 1959—Estimate

MILLIONS

2,361
Department of Defense ( M i l i t a r y Functions)
698
A t o m i c Energy Commission
217
Department of Health, Education, and W e l f a r e
121
Department of Agriculture
101

N a t i o n a l Advisory Committee for Aeronautics
55
National Science Foundation

Expenditures for research in the
Department of Agriculture will also
rise in 1959 with emphasis on
basic research in the agricultural
sciences and efforts to promote
greater utilization of farm products.
The National Advisory Committee for Aeronautics will emphasize
research in 1959 on problems involved in the flight of various
types of aircraft, ballistic and
guided missiles, and space vehicles.
These activities are primarily concerned with military aviation problems and are closely coordinated
with the work of the Department
of Defense.
Research expenditures of the

National Science Foundation will
rise almost 50% in 1959 to expand
support for basic research which
underlies the technology of the
Nation. Grants will be provided
for basic research projects in universities, for constructing and maintaining specialized scientific research facilities, and for collection
and dissemination of scientific data.
Of the total Federal research and
development expenditures, about
one-half is spent in Government
installations; the balance is spent in
industrial plants and laboratories,
universities, and other research
centers through grants and contracts.

Federal Aid to State and Local Governments
Federal payments to State and
local governments—grants-in-aid,
shared revenues, and net loans—are
expected to be over 7 % of the
Federal Government's total payments from budget and trust funds.
Grant programs constitute the bulk
of this aid and usually require
matching expenditures by the other
government units.
In the budget for 1959, the President recommends revisions in legislation or appropriations looking
toward increased State and local
responsibility for several grant programs, including urban renewal
capital grants, public assistance,
hospital construction, and schools
in areas with large Federal employment. For the most part, these
changes will not become effective
until 1960.
The continued strength of our
Federal system depends not only on
prudent limitation of Federal activities, but on reinforcing the administrative and fiscal ability of the
States to carry out their responsibilities. Accordingly, a Joint Federal-State Action Committee of
Governors and of representatives
appointed by the President from the
Federal Government has been studying various aid programs with a
view to transferring partial or complete responsibility for some of
them to the States and, at the same
time, relinquishing certain Federal
revenues for their continued support. An initial progress report
has been submitted by this Committee recommending transfers of sev-

eral programs and of one tax source.
If adopted by the Congress and the
States, these recommendations
would reduce Federal aid by
slightly over $100 million annually.
Two-thirds of all Federal aid is
for the public assistance and highway programs, with the latter
accounting for more than 70% of
the estimated $815 million increase
in total Federal aid expenditures
between 1958 and 1959. The expenditures for this scheduled acceleration of the Federal-aid highway
program come from trust funds.
Payments and grants-in-kind of
around $425 million in 1959 are to
be made by the Agriculture Department to schools, welfare departments, and other public agencies,
partly in the form of surplus
agricultural commodities.
Net expenditures for grants and
NET

BUDGET

AND

PENDITURES

TRUST

FOR

FUND

FEDERAL

EX-

AID

[In millions]

Fiscal year

Grants- Shared
in-aid revenues

1959 est... $5, 972
1958 est... 5,201
3, 943
1957
1956
3, 642
3,126
1955
2,986
1954
2,781
1953

$101
100
96
82
78
66
51

Loans

Total

$186
143
72
29
-80
-395
25

$6, 259
5,444
4,111
3, 753
3,124
2, 657
2, 857

N O T E — T h e amounts discussed in this section
exclude the Government's costs for administering
Federal aid to States and localities.

Therefore,

the figures differ somewhat from those cited elsewhere in this booklet.

Federal Aid to State and Local Governments=
Budget

and

Trust

Fund

Expenditures

1959—Estimate

MILLIONS
2,329

Budget

Expenditures

Trust Fund Expenditures
H e a l t h , A g r i c u l t u r e , N a t u r a l Resources, a n d O t h e r

loans for low-rent public housing,
urban renewal, college dormitories,
and community facilities are estimated to be $337 million in the
fiscal year 1959, or $59 million
more than in the current year.
Aids to education and science are
$56 million higher in 1959 than in

1958, with increased emphasis
being placed on grants for science
training.
Health, agricultural, natural resources, and miscellaneous other
programs will total approximately
$78 million more in fiscal year 1959
than in 1958.

Federal Credit Programs
By making direct loans and guaranteeing private loans, the Federal
Government helps to assure a flow
of credit adequate for sound economic growth. These programs
have expanded greatly in the last
quarter century and new commitments for the fiscal year 1959 are
estimated to total $16.5 billion.
Almost three-quarters of these commitments will be for guaranties of
private loans, rather than for direct
Federal loans. This will continue
the Government's policy of allowing maximum opportunity for private sources to supply the credit
needed by businesses and individuals.
The net effect of the Government's credit activities on the Federal budget is limited, even though
their effect on certain segments of
the economy is great. Guaranties
usually require budget expenditures
only when loans are defaulted, and
most of the expenditures will be
recovered from later sales of the
defaulted properties. Repayments
of direct loans offset a significant
part of the disbursements for new
loans. For these reasons, estimated net budget expenditures in
the fiscal year 1959 of $1.4 billion,
while substantial in themselves,
are only a fraction of new loan
and loan guaranty commitments.
This administration has placed
special emphasis upon achieving a
more consistent policy among the
diverse credit programs with re-

spect to (1) adequate interest rates
on all new loans; (2) substitution
of private financing for Government loans and mortgage purchases
wherever possible; and (3) effective
budgetary control. The President
recommends in the budget the enactment of legislation which would
permit greater flexibility in setting
interest rates and would require
that, insofar as consistent with the
purposes of each program, all of
the costs involved be paid by the
borrowers who benefit from future
loans. Such legislation, by removing or reducing hidden subsidies, would make a significant
contribution toward better financial
management.
In order to assure the maximum
participation of private lenders
and reduced reliance on direct
Government loans, legislation is
recommended that would authorize
Federal lending programs to substitute guaranties of private loans
to the maximum feasible extent
and, for loan guaranty programs,
would permit interest rates high
enough to attract private lenders.
Legislation is also recommended
to bring under the Government
Corporation Control Act a few
credit programs and other enterprise activities not now subject to
budgetary review and audit control.
Over two-thirds of new credit
commitments in the coming fiscal
year are estimated to be made for

Federal Credit Programs
[In billions]

Fiscal year

N e w commitments during
fiscal year
Loans

Guaranties

1959 e s t . . . -

£4.5

312.0

$16.5

$25.1

£54.4

$79.5

1958 e s t . . . -

4.9

12.7

17.6

23.4

50.1

73.6

1957

4.8

13.2

18.1

21.4

45.9

67.3

1956

2.5

15.9

18.4

19.2

43.8

63.0

1955 —

4.1

14.8

18.9

40.3

59.2

1954 —

4.1

11.8

15.9

17.8

35.5

53.3

1953

5.3

10.6

15.9

19.1

30.9

50.0

housing. The Housing and Home
Finance Agency will make $10.6
billion of these commitments. The
Agency will insure loans to build
or buy private homes and will purchase housing mortgages insured
or guaranteed by Federal agencies.
Direct loans will be made for college
housing and public facilities, and
both direct loans and guaranties
will be extended for low-rent housing and urban renewal projects
undertaken by local governments.
Virtually all new commitments
to be made by the Veterans Administration in 1959 will be to guarantee loans to assist veterans in
buying and improving homes.
These guaranties are expected to
total $844 million. This is much

Total

Outstanding and committed
at end of fiscal year
Loans

Guaranties

Total

less than in prior years, primarily
because of expiration of eligibility
for World War II veterans.
The Department of Agriculture
will extend new credit amounting
to about $2.8 billion in the fiscal
year 1959. The largest part will
be for loans and guaranties to support farm prices. Direct loans for
rural electrification and telephones
and for farm ownership and operation will be reduced; legislation is
being proposed to encourage private financing for these programs.
The remainder of new Federal
credit commitments in 1959 will
be for such purposes as the promotion of foreign trade, aid to
small businesses, and expansion of
defense production."

Receipts From and Payments to the Public
[Fiscal years.

In millions]

Description

1957
actual

Budget receipts
Trust fund receipts
Deduct:
Intragovernmental transactions
Seigniorage on silver
Total, receipts from the public
Budget expenditures
Trust fund expenditures
Government-sponsored enterprise expenditures (net)
Cash payments for previously accrued items (net)
Deduct intragovernmental transactions
Total, payments to the public
Excess of receipts over payments

A measure of the impact of Federal transactions on the economy is
obtained by consolidating budget
transactions with trust fund and
other transactions not included in
the budget. Since the consolidation excludes transactions between
and within Government agencies,
and also excludes noncash accruals,
Federal Government receipts from
and payments to the public present
information on the flow of cash between the Government and the
public.
Despite an estimated budget defi-

1958
estimate

1959
estimate

$71,029
14, 369

$72, 400
16, 373

$74, 400
16, 619

3, 243
49

3, 605
55

3,678
55

82,106

85,113

87, 286

69,433
12,961
45
811
3,243

72, 788
15,196
278
281
3,605

73, 934
16, 364
334
—291
3, 678

80,007

84, 938

86, 662

2, 099

175

624

cit of $388 million for the current
year, Federal Government receipts
from the public are estimated to
exceed payments by $175 million in
1958. This reflects continued accumulations of trust fund receipts
in excess of trust fund expenditures,
although this accumulation is
partly offset by Government-sponsored enterprise expenditures.
In 1959, the excess of receipts
from the public over payments to
the public is estimated to be $624
million, or $158 million more than
the anticipated budget surplus.

Public Debt
The public debt was reduced by
a total of $3-8 billion in the fiscal
years 1956 and 1957- It amounted
to $270.5 billion at the end of the
fiscal year 1957. The debt is estimated to be $271-2 billion at the end
of both of the fiscal years 1958 and
1959.
The annual change in the public
debt is affected not only by the
budget surplus or deficit position,
but also by such factors as changes
in the amount of cash the Government has on hand and the effect of
certain trust fund transactions. In
the fiscal year 1957, for example,
the budget surplus was $1.6 billion
but the public debt was reduced by
$2.2 billion since it was possible to
finance some expenditures during
the year by using cash balances.
In 1959, on the other hand, no

change is estimated in the debt
despite a budget surplus of $0.5
billion, because the trust funds are
expected to reduce the amount of
cash they keep with the Treasury
and the Treasury will use the
budget surplus to keep its total
cash balance at about the 1958
level.
The President is recommending
that the present debt limit of $275
billion be revised upward temporarily through the fiscal year 1959.
Such a revision is necessary because
the debt varies considerably during
the year as a result of the seasonal
pattern of tax collections. The
present limit is restrictive, particularly in view of rising defense
expenditures and of the need for
more flexibility to permit efficient
and economical debt management.

PUBLIC DEBT O U T S T A N D I N G

1953
Fiscal Year

1954

1955

1956

1957

1958

1959
Estimate

BUDGET EXPENDITURES BY FUNCTION
[Fiscal years.
Description

In millions of dollars]

1953
actual

1954
actual

1955
actual

1956
actual

1957
actual

1958
est.

1959
est.

17,123

15,958

12,997

12,182

13,649

13,837

13,753

11,556

10,961

10,643

10,666

10,384

10,343

10,523

10,379

9,357

7,905

8,519

9,214

9,341

9,292

4,553
3,954
1,467
1,791
1,008

4,059
3,629
967
1,895
1,045

3,988
2,292
1,463
1,857
944

4,424
2,611
1,184
1,651
588

5,192
2,352
1,143
1,990
490

5,340
2,200
945
2,300
565

6,211
2,200
885
2,550
422

51,830

47,872

42,089

41,825

44,414

44,871

45,836

376

444

599

521

642

117

150

130

-101
121

-90
120

-100
157

720
20
393
193

747
174
51
201

106

100

111

133

141

139

749

765

719

662

832

1,468

1,312

1,332

1,439

318
290
281

290
273
277

1,428
275
324
328

1,457
351
279
475

1,558
469
290
400

1,822
581
353
411

1,809
633
460
420

119

171

173

143

157

179

196

202

2,426

2,485

2,552

2,776

2,966

3,443

3,643

239
487
455
659
63
598

275
-506
370
312
61
301

253
211
349
356
54
281

251
54
420
463
99
741

295
49
365
518
84
144

413
351
397
686
93
205

572
426
407
i -16
88
150

2,502

814

1,502

2,028

1,453

2,146

1,627

2,420
757

2,482
782

2,681
727

2,798
788

2,870
801

3,107
846

3,232
840

659

546

664

767

774

729

626

138

158

150

123

126

136

111

Major national security:
Department of Defense:
Purchase of aircraft, missiles, ships, and
other military equipment
Pay and support of active duty military personnel
Operation and maintenance of equipment and facilities. __
Military public works, research,
serves, and other
Military assistance
Defense support
Atomic energy
Stockpiling and defense production

re-

Total, major national security

International affairs and finance:
Technical and other assistance.
Development loan fund
Export-Import Bank
Conduct of foreign affairs
Foreign information and exchange
tivities.
Total,

international

finance

affairs

ac-

and

Labor and welfare:
Public assistance (payments to States to
aid needy persons)
Promotion of public health
Promotion of education
Labor and manpower services.
Promotion of science, research, libraries,
and museums
School lunch, vocational
and other

.
rehabilitation,

T o t a l , labor and welfare

Commerce and housing:
Aviation
Housing and community development
Water transportation
Postal service.
__
Civil defense and disaster aids
General aids to business and other
Total, commerce and housing

Veterans services and benefits:
Compensation and pensions
Hospitals and medical care
_
Readjustment benefits for education and
training
Readjustment benefits for unemployment,
loan guaranty, and other

BUDGET EXPENDITURES BY FUNCTION—Continued
[Fiscal years.

In millions of dollars]
1958
est.

1959
est.

1954
actual

1955
actual

1956
actual

1957
actual

102
223

100
188

57
178

105
176

175

171

40
163

4,298

4,256

4,457

4,756

4,793

5,034

5,012

2,125

1,689
244

3,508

3,946

3,511

317

286

305

351

3,628
442

3,253
491

239
109
145

217
256
150

204
236
177

217
231
215

267
227
227

339
256
259

376
202
279

2,936

2,557

4,411

4,913

4,582

4,924

4,601

1,009
164
71
37
35

887
167
78
37
34

743
198
89
38
35

861

General resource surveys and other

1,191
150
64
38
34

62
38

967
241
143
63
43

1,009
249
131
56
47

Total, natural resources.

1,476

,315

1,202

1,104

1,296

1,457

1,492

3,300
1,678
1,044
482

3,101
1,667

3,127
1,656
1,115
473
67

3,659
1,635
1,138
354

4,103
1,582
1,241

319
63

4,700
1,500
1,300
300
67

4,700
1,500
1,300
300
69

Description

1953
actual

Veterans services and benefits—Con.
Insurance and indemnities
Other services and administration
Total, veterans services and benefits.

Agriculture and agricultural resources :
Farm price support and related program?.
Agricultural land and water resources
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, public domain, and Indian lands.
National parks and fish and wildlife
Minerals

—

225

110

Interest:
Interest on public debt:
Marketable obligations
Savings bonds
Special issues
Other nonmarketable issues
Interest on refunds and uninvested funds.
Total, interest

1,128
487

80
6,583

6,470

6,438

6,846

7,308

7,867

7,869

442
185
147

449

431
164
157
91
115

475
164

78
387

155
160
78
93

508
255
193
145
124

507
275
197
158

334

476
194
187
130
627

55
179

53
250

67
176

69
284

101

1,474

1,239

1,201

1,629

1,789

1,377

1,403

General government:
Financial management
Property and records management
FBI, alien control, and related programs.
Legislative and judicial functions
Central personnel costs
District of Columbia, territories, and
possessions
Weather Bureau and other..
Total, general government

188
115

108

Allowance for proposed legislation
and contingencies:
Pay adjustment:

160

Postal
Other (except Department of Defense).
Defense contingencies
Other contingencies
Total, budget expenditures _

74,274

67,772

64,570

66,540

69,433

200

179
500
300

72,788

73,934

i Net after adjusting rates, but does not reflect proposed postal pay increase, which is included in the
allowance for proposed legislation and contingencies.
NOTE.—Detail may not add to totals because of rounding.

BUDGET RECEIPTS AND EXPENDITURES AND PUBLIC DEBT
[Fiscal years.
Budget Surplus
( + ) or
Budget expenditures deficit ( - )
receipts

Fiscal year

1915

683
762

1916
1917

746
713
1,954

In millions of dollars]

Public
debt at
end of
year

Fiscal year

-63

1,191

1938...

5,615

6,792

+48

1,225
2,976

1939

4,996

8,858

-1,177
-3,862

5,144

9,062
13,262

-3,918
-6,159

21,987

34,046
79,407

43,635

95,059

-21,490
-57,420
-51,423

201,003

1945...
1946...
1947...

44,475
39,771

98,416

-53,941

258,682

60,448
39,032

269,422
258,286
252,292

1918

1,100
3,630

12,662

-853
-9,032

1919

5,085

18,448

-13,363

12,244
25,482

1940—
1941

1920.
1921

6,649
5,567

6,357
5,058

+291

24,299

+509

1922

4,021
3,849

3,285
3,137

+736
+713

23,977
22,963

1942...
1943...
1944...

3,853

2,890

+963

1923
1924

Budget
Surplus
Public
Budget expend( + ) or
debt at
itures deficit ( - ) end of
receipts
year

22,350
21,251

7,103
12,555

37,165
40,440
42,968
48,961
72,422
136,696

1925
1926..
1927

3,598

2,881

+717

194 8

41,488

33,069

3,753
3,992

2,888
2,837

+865
+1,155

20,516
19,643
18,512

-20,676
+754
+8,419

194 9

37,696

39,507

-1,811

252,770

1928

3,872

2,933

1950—

36,495

3,127

16,931

195 1

39,617
44,058

-3,122

3,861

+939
+734

17,604

1929

257,357
255,222

1930..

4,058

1931
1932

3,116
1,924

3,320
3,577

+738
-462

1933
1934

2,021
3,064

4,659
4,623
6,694

1935
1936

3,730
4,069
4,979

1937

6,521
8,493

195 2

47,568
61,391

16,185

195 3

64,825

65,408
74,274

16,801
19,487
22,539

1954.

64,655

67,772

-2,735
-2,602

27,053

1955...
1956...
1957...

60,390
68,165
71,029

64,570

-3,630

1958 est

72,400
74,400

72,788

+1,596
-388

73,934

+466

-2,791
-4,425
-2,777

7,756

39,786

28,701
33,779

1959 est

66,540
69,433

+3,510
-4,017

259,105
266,071

-9,449
-3,117

271,260
274,374

-4,180
+1,626

272,751
270,527
271,200
271,200

36,425

NOTE.—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 b y certain Government enterprises.

BUDGET EXPENDITURES BY FUNCTION
[Fiscal years.

In millions of dollars]
Actual

Function
1950

M a j o r national security
International affairs and finance

and

agricultural

...

1953

General government
Allowance for proposed legislation

1,206
5,817

650
1,267
5,714

1,045
1,366
5,934

1,186

1,327

1,464

2,936
1,476
6,583
1,474

and contingencies
Adjustment t o daily Treasury statement basis.
Total

+341
...

-705

1955

1956

1957

1958

1959

2,557
1,315
6,470
1,239

4,411
1,202

4,913
1,104

4,582
1,296

4,924
1,457

4,601
1,492

6,438

6,846
1,629

7,308
1,789

7,867
1,377

7,869
1,403

200

1,139

1,201

-857

39,617 44,058 65,408 74,274 67,772 6 4 , 5 7 0 6 6 , 5 4 0 69,433 72,788 7 3 , 9 3 4

NOTE.—Detail m a y not add to totals because of rounding.

1954

re2,783

Natural resources
Interest

1952

13,009 22,444 45,963 51,830 47,872 4 2 , 0 8 9 41,825 4 4 , 4 1 4 44,871 4 5 , 8 3 6
662
832 1,468 1,312
4 , 6 7 4 3,736
839
749
719
765
1,963 2,065 2,168 2,426 2,485 2 , 5 5 2 2 , 7 7 6 2 , 9 6 6 3,443 3,643
1,991 2,217 2,623 2,502
814 1,502 2,028 1,453 2 , 1 4 6 1,627
6 , 6 4 6 5 , 3 4 2 4 , 8 6 3 4 , 2 9 8 4 , 2 5 6 4 , 4 5 7 4 , 7 5 6 4,793 5 , 0 3 4 5 , 0 1 2

Labor and welfare
Commerce and h o u s i n g . .
Veterans services and benefits.
Agriculture
sources __

1951

Estimate

Glossary of Selected Budget Terms
Fiscal year.—A year running from July 1 through June 30 which is
designated by the calendar year in which it ends.
New obligational authority.—Authorizations enacted by the Congress
which allow Federal agencies to incur obligations for the payment of
money. These authorizations must precede all budget obligations and
expenditures. They are enacted in several forms, including:
Appropriation.—Authorization to spend money for a stated purpose. This is the most
common form of new obligational authority.
Contract authorisation.—Authorization to make a contract before an appropriation is
made to cover it, usually for construction which will extend over a considerable time.
A subsequent appropriation to pay for the contract is necessary.
Authorisation to expend from debt receipts.—Authority granted Government enterprises to
spend money they borrow from the Treasury or from the public.

Obligation.—Commitment made to pay out money. This includes approval of loans and contracts for equipment or construction, as well as
current commitments such as salaries or benefit payments.
Budget expenditures.—Net amounts paid to liquidate obligations. Expenditures may follow obligations by a few weeks or in some cases by as
many as three or more years. Most expenditures are made in the form of
checks and are reported for the fiscal year in which the checks are issued.
Exceptions are: (a) payments made in currency instead of by check are
reported as expenditures when the disbursements are made, (£) payments
made by issuing bonds or notes are reported as expenditures when they arc
issued, and (c) interest on the public debt is reported as an expenditure in
the year in which the interest accrues rather than when it is paid. Receipts
of public enterprise funds are deducted from the total sums disbursed by
these funds in arriving at budget expenditures. Budget expenditures
exclude payments from funds held in trust and repayments of borrowing.
Budget receipts.—Money received by the Treasury from taxes and customs
(less refunds of previous overpayments) and from miscellaneous sources
such as collections on certain loans, rents, fines, fees, and sales. Tax and
customs receipts are stated on the basis of collections reported by collecting
officers and miscellaneous receipts on the basis of confirmed deposits.
Budget receipts exclude funds received in trust and money obtained from
borrowing.
Budget surplus.— Excess of budget receipts over budget expenditures in
any fiscal year. A surplus may be added to the cash held by the Government, used to retire part of the debt or both.

Glossary—Continued
Budget deficit.—Excess of budget expenditures over budget receipts in
any fiscal year. A deficit may be financed by increasing the debt, by
decreasing the cash held by the Government, or both.
Unexpended balances carried forward.—Portions of obligational authority
enacted in prior years in the several forms mentioned above which are still
available in the succeeding year(s). These balances consist of authority
to incur obligations or to draw cash from the Treasury as needed to pay
for obligations; they are not cash on hand.
Revolving funds— Funds which finance a cycle of operations, in which
expenditures generate receipts that are available for continuing use. Revolving funds may be for public enterprises with receipts primarily from
outside the Government, such as the postal fund, or for performance of
services, such as printing, to meet the Government's own needs.
Management funds— Funds created to permit pooling of advance payments
under two or more appropriations in order to carry out closely related
activities.
Trust funds—Funds established for receipts held in trust by the Government for use in carrying out specific purposes in accordance with an agreement or statute.
Loan guaranty —A credit aid in which the Government pledges to repay
loans made by others in case the borrower defaults or, in some cases, pledges
to take over loans from private lenders at their option.

UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON: 1958

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

E X E C U T I V E

EXECUTIVE OFFICE OF THE PRESIDENT BUREAU OF THE BUDGET

BRANCH

THE

G O V E R N M E N T

DECEMBER 19S7

Full text of Budget in Brief : Fiscal Year 1959

FRASER