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FISCAL YEAR 2013 MID-SESSION REVIEW BUDGET OF THE U.S. GOVERNMENT OFFICE OF MANAGEMENT AND BUDGET BUDGET.GOV FISCAL YEAR 2013 MID-SESSION REVIEW BUDGET OF THE U.S. GOVERNMENT OFFICE OF MANAGEMENT AND BUDGET Scan here to go to our website. EXECUTIVE OFFICE OF THE PRESIDENT OFFICE OF MANAGEMENT AND BUDGET WASHINGTON D. C. 20503 THE DIRECTOR July 27, 2012 The Honorable John A. Boehner Speaker of the House of Representatives Washington, DC 20510 Dear Mr. Speaker: Section 1106 of Title 31, United States Code, requests that the President send to the Congress a supplemental update of the Budget that was transmitted to the Congress earlier in the year. This enclosed supplemental update of the Budget, commonly known as the Mid-Session Review, contains revised estimates of receipts, outlays, budget authority, and the budget deficit for fiscal years 2012 through 2022. Sincerely, Jeffrey D. Zients Acting Director Enclosure Identical Letter Sent to the President of the Senate TABLE OF CONTENTS Page List of Tables��������������������������������������������������������������������������������������������������������������������������������������������� iii Summary�����������������������������������������������������������������������������������������������������������������������������������������������������1 Economic Assumptions�������������������������������������������������������������������������������������������������������������������������������7 Receipts�����������������������������������������������������������������������������������������������������������������������������������������������������13 Expenditures���������������������������������������������������������������������������������������������������������������������������������������������17 Summary Tables���������������������������������������������������������������������������������������������������������������������������������������21 i LIST OF TABLES Page Table 1. Changes in Deficits from the February Budget �����������������������������������������������������������������6 Table 2. Economic Assumptions �������������������������������������������������������������������������������������������������������9 Table 3. Comparison of Economic Assumptions ����������������������������������������������������������������������������11 Table 4. Change in Receipts ������������������������������������������������������������������������������������������������������������15 Table 5. Change in Outlays �������������������������������������������������������������������������������������������������������������20 Table S–1. Budget Totals ���������������������������������������������������������������������������������������������������������������������22 Table S–2. Effect of Mid-Session Review Proposals on Projected Deficits ���������������������������������������23 Table S–3. Deficit Reduction since January 2011 ������������������������������������������������������������������������������24 Table S–4. Adjusted Baseline by Category �����������������������������������������������������������������������������������������25 Table S–5. Proposed Budget by Category �������������������������������������������������������������������������������������������27 Table S–6. Proposed Budget by Category as a Percent of GDP ��������������������������������������������������������29 Table S–7. Proposed Budget in Population- and Inflation-Adjusted Dollars �����������������������������������31 Table S–8. Bridge from Budget Enforcement Act Baseline to Adjusted Baseline ����������������������������33 Table S–9. Change in the Adjusted Baseline from Budget to MSR ��������������������������������������������������34 Table S–10. Mandatory and Receipt Proposals ������������������������������������������������������������������������������������36 Table S–11. Outlays for Mandatory Programs under Current Law ���������������������������������������������������55 Table S–12. Funding Levels for Appropriated (“Discretionary”) Programs by Category ������������������56 Table S–13. Funding Levels for Appropriated (“Discretionary”) Programs by Agency ���������������������57 Table S–14. Federal Government Financing and Debt ������������������������������������������������������������������������60 iii SUMMARY This Mid-Session Review (MSR) updates the Administration’s estimates for outlays, receipts, and the deficit for economic, legislative, and other changes that have occurred since the President’s 2013 Budget was released in February. The 2012 deficit is now projected to be $1,211 billion, $116 billion lower than the $1,327 billion deficit projected in February, due to lower-than-expected spending, partially offset by lower-than-expected receipts. As a percentage of gross domestic product (GDP), the deficit is now projected to equal 7.8 percent, down from the 8.5 percent projected in February. Cumulative deficits for the following 10 years are also projected to be lower than previously projected, with a total reduction of $240 billion over the 10-year period. This reduction results primarily from lower projected spending for Medicare, Medicaid, Social Security, and net interest, partially offset by lower projected receipts. CREATING JOBS AND ECONOMIC GROWTH The Budget released in February reflected an economy no longer in the free-fall it was experiencing when the President took office. In the last quarter of 2008, real GDP was dropping at annual rate of 8.9 percent. Credit markets that provided access to business capital seized up, and companies began to lay off workers and cut costs at an unprecedented rate. In January 2009 alone, the economy lost 839,000 private sector jobs. A steep decline in the stock market, combined with falling home prices, led to an enormous loss of household wealth. Corresponding to this loss in wealth was a reduction in consumer demand, a key driver of economic growth. The economy was in the worst downturn since the Great Depression, with significant risk that conditions could worsen. That is why the President took swift action to jumpstart economic growth and avoid a second Great Depression by signing into law the American Recovery and Reinvestment Act (Recovery Act). The Recovery Act provided critical support to promote economic activity, mitigate the damaging effects of the recession, and save and create jobs. The Recovery Act was augmented by several other critical policy interventions. In March 2010, the President signed the Hiring Incentive to Restore Employment (HIRE) Act, which provided subsidies for firms that hired unemployed workers and provided other incentives. The Small Business Jobs Act, enacted the following September, provided tax relief and better access to credit to small businesses. In December 2010, the President signed into law the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act (TRUIRJCA), which included a two-percentage point payroll tax holiday and extended emergency unemployment benefits. The one-year payroll tax holiday and emergency unemployment benefits in TRUIRJCA were extended for two months at the end of 2011 and through the remaining 10 months of calendar year 2012 in mid-February, shortly after the President’s Budget was released. The Recovery Act and these subsequent legislative actions helped put the country on the path to economic recovery. Since 2009, real GDP has risen for 11 straight quarters. The unemployment rate has declined from its peak of 10.0 percent to 8.2 percent in June 2012 and private sector employment has grown for 28 straight months. Yet despite this progress, the economy is not growing fast enough and there are still too many people out of work. Most troubling, the pace of improvement in the labor market slowed in the second quarter of this year. The Nation faces these challenges because of a number of economic headwinds. First, economists have found that recessions linked with financial crises tend to be deeper than other recessions, and the subsequent recoveries take longer. Our current situation is no exception. As is common following a financial crisis in which banks and other credit market institutions suffer severe losses, many creditworthy borrowers are finding it difficult to obtain credit, dampening spending and investment. Second, while the housing sector is seeing some recovery in prices from the bursting of the housing bubble, this critical part of the economy is taking time to rebound fully. Third, State and local governments have still 1 2 found it necessary to pursue fiscal consolidation to meet their balanced budget requirements. This fiscal tightening at the State and local levels has reduced aggregate demand and has had the effect of slowing overall economic growth. Finally, economic and financial fragility in the Euro area remains a significant risk to the U.S. recovery and to the global economy. Europe is the U.S.’s largest export market, so weaker demand in Europe means weaker job growth at home. European banks are interconnected with financial markets around the world, so volatility in Europe undermines sentiment here at home. That is why the Administration has consulted closely with its European counterparts throughout the crisis and has urged European officials to take steps to reduce immediate financial market stresses, even as they undertake longer-term reform and integration plans to promote growth, adjustment, and stability. Because the economic recovery is facing headwinds and not creating enough jobs, the President has called for commonsense, targeted, and fiscally responsible measures to boost economic activity. In September 2011, the President sent Congress the American Jobs Act (AJA), a package of cross-sectoral proposals with a simple goal: to put more people back to work and place more money in the pockets of working Americans, without increasing the deficit. The proposal included tax cuts to help America’s small businesses hire and grow; tax credits to spur hiring; investments in infrastructure improvements; new pathways back to work for Americans looking for jobs; and tax cuts to put more money in the pockets of every American worker and family – all historically bipartisan ideas that independent economists estimated would create 1.3 to 1.9 million jobs and boost growth in 2012 by up to 2 percent. Lack of Congressional action has so far prevented critical components of the AJA from becoming law. In February, the President put forward his 2013 Budget proposal. In addition to making tough choices to put the Nation on a sustainable fiscal path, the President’s Budget included a number of measures from the AJA, along with other proposals to help boost eco- MID-SESSION REVIEW nomic growth and job creation. Specifically, the President called for $350 billion in shortterm measures for job creation that included the extension of the payroll tax cut and unemployment insurance benefits for rest of 2012; an upfront investment of $50 billion from the surface transportation reauthorization bill for roads, rails, and runways to create thousands of quality jobs in the short term; a continuation of the business write-off of the full amount of new investments; $30 billion to modernize at least 35,000 schools; and $30 billion to help States and localities retain and hire teachers and first responders. In June, at the Administration’s urging, Congress passed a bipartisan bill to stop student loan interest rates from doubling and to reauthorize surface transportation legislation that will keep millions of construction workers on the job rebuilding the Nation’s aging infrastructure. But there is still much more Congress can do to create jobs and grow the economy. That is why the President has called on Congress to act on a “To Do List” that would create jobs and help restore middle-class security. The To Do List includes proposals to reward American jobs and curb tax incentives to ship jobs overseas; cut red tape so that responsible homeowners can refinance; invest in a new hire tax credit for small businesses; create jobs by investing in affordable clean energy; and put returning veterans to work using skills developed in the military. These are all commonsense steps that would help counter the economic challenges we face, get more Americans back to work, and strengthen our economy. With the exception of the shortterm agreement in February 2012 to extend the payroll tax holiday and emergency unemployment provisions through the end of the calendar year, Congress has not yet passed any of these plans to boost economic growth and create jobs. BALANCED DEFICIT REDUCTION Constructing an economy that is built to last and creates good jobs for generations to come will require making the investments in education, infrastructure, innovation, and clean energy that are critical to a 21st century, high-growth economy. To pay for these investments, cut persistent deficits, and sta- SUMMARY bilize the debt, we need to give everyone a fair shot and ask everyone to pay their fair share as we put the Nation’s fiscal house in order. For too long, Washington has enacted new tax cuts or spending programs without identifying a way to pay for them. Indeed, the cost of the 2001 and 2003 tax cuts and the Medicare prescription drug benefit passed during the last Administration contributed significantly to turning the surpluses of the 1990s into the deficits of the following decade. The financial crisis and recession that began in 2008 exacerbated Federal deficits as revenue decreased and automatic Government outlays increased to mitigate the impacts of the recession. The result was that, upon taking office, the President faced an annual deficit of $1.3 trillion, or 9.2 percent of GDP, and a 10-year deficit of more than $8 trillion — a figure that grew even larger as the depth of the recession became clear. While the need to jumpstart the economy through the Recovery Act and other measures added to the short-term deficit, these critical measures were temporary and will not have significant deficit effects in the longer term. Since taking office, the President has worked to restore fiscal responsibility. Recognizing the role that rising health care costs play in the Nation’s long-term fiscal future, the President advocated for, and signed into law, fiscally responsible health care reform that will reduce the deficit by more than $1 trillion over the next two decades and pay for all new coverage. The President also convened the bipartisan National Commission on Fiscal Responsibility and Reform (the Fiscal Commission) whose work reset the debate about further deficit reduction and provided a framework for the kind of balanced deficit reduction package that is needed. The President’s submission to the Joint Select Committee on Deficit Reduction in September 2011 and his 2013 Budget released last February both included many proposals from the Fiscal Commission plan and followed a similar approach of drawing from all parts of the budget. In the 2013 Budget, the President put forward a plan that, building on the deficit reduction undertaken the previous year, would reduce the deficit over the next decade by more than $4 trillion, put the country on a course to achieve deficits be- 3 low 3 percent of GDP by the end of the decade, and stabilize the debt relative to the size of the economy. The President’s plan, as updated in the Mid-Session Review, achieves those results by following a balanced approach. First, implementing the discretionary spending caps in the Budget Control Act of 2011 (BCA) will generate approximately $1 trillion in savings over the next decade and will bring domestic discretionary spending to its lowest level as a share of the economy since the Eisenhower Administration. Second, to build on the work done to reduce health care costs through the Affordable Care Act, the President proposes $326 billion in additional reforms to Medicare, Medicaid, and other health programs over 10 years. Third, he puts forward $254 billion in additional mandatory savings over the next decade. Fourth, the President proposes a plan to raise more than $1.5 trillion in revenues over the next decade through tax reform that would not raise taxes on those making less than $250,000 per year (for married couples), but would ask millionaires, billionaires, and large corporations to shoulder their fair share. Unfortunately, Congress has not yet passed a balanced deficit reduction framework, let alone the necessary legislation enacting that framework into law. Instead, the House has embraced a budget resolution that fails the test of balance, fairness, and responsibility proposing large tax cuts for the wealthy and deep cuts in areas needed to grow the economy and support small and growing businesses, the middle class, and vulnerable populations. Because the Joint Select Committee on Deficit Reduction established by the BCA failed to agree on a balanced approach to deficit reduction by its November 2011 deadline, Congress was unable to meet the requirements of the BCA that it voted into law, to approve $1.2 trillion in additional deficit reduction by the end of 2011. As a result, the Nation faces the prospect of a sequestration taking effect on January 2, 2013. The scheduled sequestration is, by design, bad policy that will have destructive effects on both defense and non-defense discretionary programs and services and on critical entitlement programs such as Medicare. The Administration believes Congress should act to avoid the sequester with a balanced deficit reduction package, along the lines of the President’s 2013 Budget. Congress still has time to act and it should do 4 so promptly, to reduce the deficit in a way that is balanced and not harmful to the economic health of the nation. The President has also called on Congress to extend middle-class tax cuts for the 98 percent of Americans making less than $250,000 for another year. If Congress fails to act, a typical middle-class family of four will see its taxes go up by $2,200 next year. MID-SESSION UPDATE The Mid-Session Review updates estimates of Federal receipts, outlays, and the deficit for legislation enacted through early July, and for a revised economic forecast, technical reestimates, and other policy changes that have occurred since the President’s Budget was released in February. Revised Deficit and Debt Outlook The deficit for 2012 is now expected to be $1,211 billion, down $116 billion from the deficit of $1,327 billion deficit estimated in February. As a percentage of GDP, the 2012 deficit is projected to be 7.8 percent of GDP, down from 8.5 percent of GDP in February. This latest projection also represents a decline in the deficit from 2011, both in dollar terms and as a percentage of GDP. The reduction in the estimated 2012 deficit from February is more than accounted for by lower projections of spending for this year, which are partly offset by lower projected receipts. A portion of the lower deficit is due to revised estimates of the impact of the Administration’s proposals for temporary tax relief and investments to create jobs and jumpstart growth. In the February Budget, much of the cost of these proposals was estimated to occur in 2012. However, because most of these proposals have not yet been enacted, the MSR estimates that these costs will largely shift to 2013 and later years, which reduces the 2012 deficit. Relative to the February estimate, the deficit is now projected to be higher in 2013, estimated at $991 billion as compared to $901 billion in February. This increase is driven by lower receipt projections and the shift in costs of the temporary jobs proposals. Over the 10-year budget window, 2013 through 2021, deficits are now projected to be $240 billion lower than in February, due almost entirely MID-SESSION REVIEW to economic and technical revisions that reduce outlays while reducing receipts by lower amounts. As a percent of GDP, deficits are reduced in each year of the MSR forecast after 2014. The deficit is projected to stabilize at 2.6 percent of GDP after 2017, down from an ultimate level of 2.8 percent of GDP in the February projections. The lower deficit outlook in the MSR produces correspondingly lower projections for Federal Government debt held by the public. Debt held by the public, which is an important indicator of the extent to which Government activity affects the financial markets, is projected to be $11,414 billion at the end of 2012, or 73.5 percent of GDP, down from the estimate of $11,578 billion, or 74.2 percent of GDP, in February. Debt at the end of 2013 is projected to be $12,572 billion, down from $12,637 billion in February, but as a percent of GDP is projected to be slightly higher than in February (77.5 percent versus 77.4 percent) because of downward revisions in the GDP forecast. Over the longer term, the lower deficits in the MSR result in a declining path for debt held by the public as a share of GDP. In the February Budget, deficits stabilized in the second half of the 10-year budget window at around 2.8 percent of GDP, a level which was sufficient to hold debt stable at around 76.5 percent of GDP. The reduction of outyear deficits in the MSR to 2.6 percent of GDP is sufficient to bring the debt share of GDP down slightly each year, with debt falling from 77.1 percent in 2017 to 75.1 percent in 2022. Debt net of financial assets, a measure which nets out financial assets such as direct loan holdings from the debt level, shows a similar declining path, falling from 68.4 percent of GDP in 2017 to 66.2 percent of GDP in 2022. Enacted Legislation Legislation enacted since the February Budget was released has a minimal effect on the updated budget projections, because the provisions of that legislation with the largest effects on receipts and outlays were already reflected in the Administration’s February proposals. Overall, enacted legislation and other policy changes, including debt service on these changes, increases the deficit relative to the February Budget by $1 billion in 5 SUMMARY 2012 and reduces deficits by $15 billion over the 10-year period, 2013 through 2022. Middle Class Tax Relief and Job Creation Act. This legislation, enacted shortly after the President’s Budget was released, extended the two-percentage point payroll tax holiday, emergency unemployment benefits, and relief from reductions in Medicare physician payments for the remainder of calendar year 2012. These provisions were all due to expire at the end of February. In addition to extending these expiring provisions, the bill also increased retirement contributions for new Federal civilian employees, repealed certain timing shifts in corporation income tax payments, expanded authority for auctions of the electromagnetic spectrum with a portion of the proceeds designated for development of an interoperable public safety communications network, and made several changes in Medicare and Medicaid. The February Budget already reflected proposals that were similar to the provisions in the act, so that its passage had only a minimal effect on the Budget estimates, raising the deficit by $2 billion in 2012 and reducing the deficit by $1 billion over 2013 through 2022. Moving Ahead for Progress in the 21st Century Act (MAP-21). MAP-21 reauthorized surface transportation programs through 2014, reauthorized the National Flood Insurance Program through 2017, and delayed for one year an increase in student loan interest rates that was scheduled to take place as of July 1, 2012. Among the act’s numerous other provisions, it changed requirements for employers to make contributions to defined benefit pension programs, raised premiums paid to the Pension Benefit Guaranty Corporation, limited the receipt of student loans to 150 percent of the institution’s program length, and established a phased retirement program for Federal employees. As with the Middle Class Tax Relief and Job Creation Act, most of the bill’s provisions with significant budgetary effects were versions of proposals already included in the February Budget. Enactment of MAP-21 reduced the deficit by $1 billion in 2012 and by $5 billion over 2013-22. Estimating Changes New estimates of receipts and outlays due to revisions to the economic forecast and technical estimating assumptions reduce the deficit by $117 billion in 2012. These changes increase the deficit by $101 billion in 2013, but reduce the deficit by a total of $225 billion over the 10-year period as a whole. The $117 billion reduction in the deficit in 2012 due to estimating changes is more than accounted for by a $144 billion reduction in outlays, due to new information on spending to date, delay in enactment of the February jobs proposals, and other factors. The outlay reduction is spread across discretionary and mandatory programs, including $32 billion lower outlays due to the cost of the temporary jobs proposals shifting from 2012 into 2013 and 2014. The $144 billion reduction in outlays is partly offset by a reduction of $27 billion in receipts, which is itself due to a weaker near-term economic forecast and revisions in technical factors, offset by a shift in receipt effects of unenacted jobs proposals from 2012 into 2013 and later years. Over the 10-year period 2013 through 2022, revisions to the economic projection and technical re-estimates reduce the deficit by $225 billion. This reduction is the net effect of reductions in outlays of $743 billion over 10 years, offset by reductions in receipts of $518 billion. The reductions in outlays are the result of lower projected spending for net interest, resulting primarily from lower assumed interest rates relative to the February economic forecast, and lower spending for Social Security, Medicare, and Medicaid, due to a combination of economic and technical factors. About half of the reduction in receipts is due to the revised economic forecast, particularly reduced levels of GDP growth and incomes, and the remainder is due to technical factors, chiefly updated information about corporation income tax payments. More detail about changes in receipt and outlay projections can be found in the receipt and spending sections of the Mid-Session Review. 6 MID-SESSION REVIEW Table 1. CHANGES IN DEFICITS FROM THE FEBRUARY BUDGET (Dollar amounts in billions) 2013– 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2022 2013 February Budget deficit ������������������������������� 1,327 901 668 610 649 612 575 626 658 681 704 Percent of GDP �������������������������������������������������� 8.5% 5.5% 3.9% 3.4% 3.4% 3.0% 2.7% 2.8% 2.8% 2.8% 2.8% Enacted legislation and policy changes: Middle Class Tax Relief and Job Creation Job Act of 2012 ����������������������������������������� Moving Ahead for Progress in the 21st Century Act of 2012 ��������������������������������� Other legislation and policy changes ���������� Debt service �������������������������������������������������� Subtotal, enacted legislation and policy changes ���������������������������������������������������������� 2 –8 * –2 –1 –* 1 3 2 2 1 –10 –1 –1 * * –4 * –* –8 * –* –8 * –1 –5 –* –1 –1 –* –1 1 –* –2 2 –* –1 5 –* –1 7 –* –1 7 –* –1 –27 * –3 –5 * –9 1 –12 –8 –10 –7 –3 1 4 6 7 7 –40 –15 –49 76 32 113 3 51 2 56 1 51 1 53 1 47 * 29 * 23 * 25 * 29 38 324 40 478 27 –55 144 –17 53 16 58 17 52 7 54 2 47 * 30 –* 23 –* 25 –* 29 –* 363 25 518 24 4 –9 –4 –13 –7 –15 –7 –11 –6 –12 –8 –8 –7 –8 –9 –5 –9 –10 –10 –3 –12 –8 –11 –1 –14 –10 –11 –1 –15 –10 –12 * –17 –10 –12 * –18 –8 –15 * –18 –7 –15 * Economic and technical reestimates: Receipts: Temporary tax relief to create jobs and jumpstart growth ���������������������������������� Other receipts �������������������������������������������� Total receipts ����������������������������������������� Discretionary programs ������������������������������� Mandatory: Medicaid ��������������������������������������������������� Medicare ���������������������������������������������������� Social Security ������������������������������������������� Unemployment compensation ����������������� Supplemental Nutrition Assistance Program ������������������������������������������������ Mutual Mortgage Insurance Fund ����������� Purchases of GSE preferred stock ������������ Deposit Insurance Fund ��������������������������� Temporary investments to create jobs and jumpstart growth ��������������������������� Other ���������������������������������������������������������� –41 –123 –52 –97 –45 –110 –29 –28 –4 –1 –2 –4 –4 –4 –3 –2 –2 –2 –2 –16 –26 –2 –* –* –1 –1 –2 –2 –2 –3 –3 –4 –4 –19 –16 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –6 2 * * 2 3 4 5 1 1 * 7 18 –32 –1 30 2 2 ......... ......... ......... ......... ......... ......... ......... ......... 1 –3 4 –1 3 –* * 1 2 Total mandatory ������������������������������������ –84 Net interest 1�������������������������������������������������� –6 Subtotal, economic and technical reestimates � –117 –7 –19 101 –35 –33 1 –37 –43 –5 –33 –53 –26 –34 –55 –33 –34 –47 –33 –37 –44 –51 –42 –41 –59 –44 –41 –61 –43 –146 –346 –45 –203 –422 –59 38 –225 Total, changes �������������������������������������������������������� –116 89 –6 –15 –33 –36 –33 –47 –54 –53 –52 Mid-Session Review deficit ����������������������������������� 1,211 991 661 595 615 576 543 578 604 627 652 Percent of GDP �������������������������������������������������� 7.8% 6.1% 3.9% 3.3% 3.2% 2.9% 2.6% 2.6% 2.6% 2.6% 2.6% Note: positive figures represent higher outlays or lower receipts. *$500 million or less. 1 Includes debt service on all reestimates. 32 2 32 8 –1 –240 ECONOMIC ASSUMPTIONS This Mid-Session Review (MSR) updates the economic forecast from the 2013 Budget, which was completed last November and released with the Budget in early February. The 2013 Budget forecast projected that the economic recovery that began in 2009 would continue. Unemployment was expected to decline as the economy recovered, and inflation was expected to remain moderate. Interest rates were expected to remain quite low in the near term, but to rise gradually in the medium term. The MSR forecast, which was completed in June, maintains these assumptions with minor modifications to take account of changing conditions since the last forecast. the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act (TRUIRJCA) in December 2010 further sustained demand and fostered continued growth. TRUIRJCA included a two-percentage point payroll tax holiday and extended emergency unemployment benefits among other measures. The one-year payroll tax holiday and emergency unemployment benefits in TRUIRJCA were extended for two months at the end of 2011. In mid-February 2012, the President and Congress agreed to extend the payroll tax holiday and a modified version of the emergency unemployment provisions through the end of the calendar year. Since 2009, real GDP has risen for 11 straight quarters.1 The unemployment rate has declined from its peak of 10.0 percent to 8.2 percent in June 2012. Following the resumption of real GDP growth, the economy began adding jobs, and private sector employment has increased in each of the past 28 months. The labor market recovery is occurring only gradually, however, and the pace of improvement slowed again in the second quarter of this year. It will take several more years of healthy job growth to offset fully the 8.9 million private sector jobs that were lost between January 2008 and February 2010. Last summer, the Administration and Congress reached agreement on the Budget Control Act of 2011 (BCA), which will reduce the budget deficit and moderate the rise in the debt-to-GDP ratio in the later years of the forecast. This fiscal adjustment is needed to avoid an unsustainable rise in debt that would undermine future growth. At the same time, near-term action is needed to avoid a major fiscal contraction in 2013, which would threaten the recovery. The 2013 Budget also proposed a number of policies that would help sustain growth in 2012 and 2013. Some of these, including the extension of the payroll tax holiday and emergency unemployment compensation, have been enacted. The Administration continues to support the remaining policies, and the MSR forecast assumes they will be enacted. Administration policies have contributed to the economic recovery, as have the automatic fiscal stabilizers such as the unemployment compensation system. In the last quarter of 2008, real GDP was dropping at an annual rate of 8.9 percent; in January 2009 alone, the economy lost 839,000 private sector jobs. The Administration’s prompt action in enacting the American Recovery and Reinvestment Act helped to reverse these declines in jobs and real GDP and opened the way to a sustained economic recovery. Additional actions by the Administration and Congress culminating in the passage of Data were available only through 2012:Q1 when the forecast was completed in June. Data for the second quarter were released on July 27, after the MSR was printed. 1 Although Administration actions helped spark and sustain the ongoing recovery, the economy continues to face serious headwinds that have dampened growth and limited gains in employment. Financial market uncertainty has hampered new borrowing and lending for purposes of business investment and home construction. Spreads between private debt, such as commercial paper, and Treasury securities have generally returned to precrisis levels, but standards remain relatively tight, and many credit-worthy borrowers still have had difficulty finding credit. Eventually, credit should become more available, but that usually takes time. 7 8 The bursting of the housing bubble and dramatic loss of housing wealth during the crisis has had a severe impact on the overall U.S. economy. Despite the deep hole created by the crisis, there is growing evidence that the housing market has stabilized and is beginning to rebound. The inventory of homes on the market has been declining rapidly, from a peak of 12.1 months in July of 2010 to 6.4 months in June of 2012. Moreover, housing starts jumped to a nearly 4-year high in June, increasing 23.6 percent from 12 months earlier. Meanwhile, housing prices have begun to recover. All three of the major housing price indices posted increases in prices this spring. Government and private sector mortgage modification programs have allowed millions of affected homeowners to stay in their homes by restructuring unaffordable mortgages, increasingly by writing down the principal on these loans. Moreover, efforts to remove barriers to refinancing have begun to have an impact. Since changes were implemented in the Home Affordable Refinance Program (HARP), HARP refinancing closings have increased dramatically, growing 93 percent between the last quarter of 2011 and the first quarter of 2012. The country has also faced an unprecedented amount of fiscal drag from State and local governments, which over the past four decades have contributed about ¼ percentage point to GDP growth annually on average. However, thus far in the recovery State and local government spending has been on a downward trajectory. State governments generally face balanced budget requirements, and the economic downturn, which reduced State and local tax revenue significantly, has forced fiscal consolidation at the State and local government level. The 2009 Recovery Act helped ease the burden of State and local government fiscal adjustments in 2009-2010, and subsequent measures have also helped the States and localities deal with budget shortfalls. But despite this Federal aid, State and local governments have still found it necessary to pursue fiscal consolidation to meet their balanced budget requirements. This fiscal tightening at the State and local level has reduced aggregate demand and slowed growth nationally. Since June 2010, employment in State and local government has de- MID-SESSION REVIEW clined by 408,000 jobs, while the private sector has been a net creator of jobs. Over the four quarters ending in 2012:Q1, real outlays by State and local governments for consumption and investment fell by 2.3 percent and lowered real GDP growth by 0.5 percentage points. Economic and financial fragility in the Euro area remains a significant risk to the U.S. recovery and to the global economy. Europe is the largest export market for the U.S., so weaker demand in Europe means weaker job growth at home. European banks are interconnected with financial markets around the world, so volatility in Europe undermines sentiment in the United States. Because of these concerns, the Administration has consulted closely with its European counterparts throughout the crisis and has urged European officials to take steps to reduce immediate financial market stresses, even as they undertake longer-term reform and integration plans to promote growth, adjustment, and stability. Despite these headwinds, the Administration expects economic growth to continue at a moderate pace in 2012 and 2013 and to pick up in 2014. The U.S. economy is operating well below its capacity, with higher levels of unused resources than at any time in over a quarter century. The potential for a more rapid recovery is present in this low level of resource utilization. At some point over the next few years, such an acceleration in the recovery is likely to occur, and the Administration forecast reflects that expectation. The Administration does not believe that the U.S. economy has permanently foregone all of the output lost during the recession. With improved growth in 2014-2018, unemployment is projected to further decline, as the economy returns to its potential. Beyond 2018, the Administration’s forecast is based on the long-run trends expected for real GDP growth, price inflation, and interest rates. Real GDP growth is expected to average 2.5 percent in the long run, which is unchanged from previous forecasts. This projection is somewhat below the historical average for the United States, because of an expected slowdown in the growth of the labor force as the population ages. 9 ECONOMIC ASSUMPTIONS Table 2. ECONOMIC ASSUMPTIONS 1 (Calendar years; dollar amounts in billions) Actual 2010 Projections 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Gross Domestic Product (GDP): Levels, dollar amounts in billions: Current dollars �������������������������������� 14,527 15,094 15,702 16,396 17,252 18,272 19,340 20,457 21,507 22,505 23,515 24,563 25,663 Constant (2005) dollars ������������������ 13,088 13,315 13,626 13,996 14,484 15,084 15,689 16,290 16,804 17,252 17,687 18,129 18,582 Price index (2005 = 100) ����������������� 111.0 113.3 115.2 117.1 119.1 121.1 123.3 125.6 128.0 130.4 133.0 135.5 138.1 Percent change, Q4/Q4: Current dollars �������������������������������� Constant (2005) dollars ������������������ Price index (2005 = 100) ����������������� 4.7 3.1 1.6 3.8 1.6 2.1 4.3 2.6 1.7 4.3 2.6 1.6 5.7 4.0 1.7 6.0 4.2 1.7 5.8 3.9 1.8 5.8 3.8 1.9 4.8 2.8 1.9 4.6 2.6 1.9 4.4 2.5 1.9 4.5 2.5 1.9 4.5 2.5 1.9 Percent change, year over year: Current dollars �������������������������������� Constant (2005) dollars ������������������ Price index (2005 = 100) ����������������� 4.2 3.0 1.2 3.9 1.7 2.1 4.0 2.3 1.7 4.4 2.7 1.7 5.2 3.5 1.7 5.9 4.1 1.7 5.8 4.0 1.8 5.8 3.8 1.9 5.1 3.2 1.9 4.6 2.7 1.9 4.5 2.5 1.9 4.5 2.5 1.9 4.5 2.5 1.9 Incomes, billions of current dollars: Domestic corporate profits �������������� Employee compensation ����������������� Wages and salaries ������������������������� Other taxable income 2 �������������������� 1,418 7,971 6,408 3,108 1,514 8,277 6,668 3,303 1,743 8,540 6,888 3,437 1,817 8,869 7,182 3,607 1,820 9,318 7,538 3,842 1,913 9,903 7,988 4,123 2,017 10,532 8,505 4,419 2,081 11,211 9,071 4,675 2,103 11,857 9,610 4,914 2,072 12,493 10,135 5,137 2,042 13,126 10,653 5,372 1,956 13,796 11,193 5,594 1,906 14,487 11,753 5,801 Consumer Price Index (all urban): 3 Level (1982-84 = 100) ���������������������� Percent change, Q4/Q4 �������������������� Percent change, year/year ��������������� 218.1 224.9 229.7 234.0 238.7 243.5 248.5 254.0 259.5 265.3 271.1 277.1 283.1 1.2 3.3 1.9 1.9 2.0 2.0 2.1 2.2 2.2 2.2 2.2 2.2 2.2 1.6 3.1 2.1 1.9 2.0 2.0 2.1 2.2 2.2 2.2 2.2 2.2 2.2 Unemployment rate, civilian, percent: Fourth quarter level ������������������������ Annual average ������������������������������� 9.6 9.6 8.7 8.9 7.9 8.0 7.6 7.7 7.1 7.3 6.5 6.7 6.0 6.2 5.5 5.7 5.4 5.4 5.4 5.4 5.4 5.4 5.4 5.4 5.4 5.4 Federal pay raises, January, percent: Military 4 ������������������������������������������ Civilian 5 ������������������������������������������� 3.4 2.0 1.4 0.0 1.6 0.0 1.7 0.5 NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA Interest rates, percent: 91-day Treasury bills 6 ��������������������� 10-year Treasury notes ������������������� 0.1 3.2 0.1 2.8 0.1 2.0 0.2 2.7 1.1 3.5 2.3 4.1 3.3 4.5 3.6 4.9 3.8 5.0 3.8 5.1 3.8 5.1 3.8 5.1 3.8 5.1 NA = Not Available; Q4/Q4 = fourth quarter over fourth quarter Based on information available as of June 2011. 2 Rent, interest, dividend, and proprietors' income components of personal income. 3 Seasonally adjusted CPI for all urban consumers. 4 Percentages apply to basic pay only; percentages to be proposed for years after 2013 have not yet been determined. 5 Overall average increase, including locality pay adjustments. Percentages to be proposed for years after 2013 have not yet been determined. 6 Average rate, secondary market (bank discount basis). 1 10 ECONOMIC PROJECTIONS The MSR economic projections are based on information available through early June 2012. They are summarized in Table 2. Real Gross Domestic Product (GDP) and the Unemployment Rate: Real GDP is expected to rise by 2.6 percent during the four quarters of 2012 and to increase 2.6 percent in the four quarters of 2013. The growth rate is projected to rise to 4.0 percent in 2014 and 4.2 percent in 2015. Beyond 2015, real GDP growth is projected to moderate as the level of real GDP approaches its potential. The growth rate is steady at 2.5 percent per year in 2020-2022. The unemployment rate is projected to reach 7.9 percent by the fourth quarter of 2012, below its level in June. Unemployment is projected to decline slowly this year and next, because of the moderate pace of expected real GDP growth and because, as labor market conditions improve, workers rejoin the labor force, adding upward pressure on unemployment. With accelerated growth, the unemployment rate is projected to fall more rapidly, eventually stabilizing at 5.4 percent. Inflation: Overall inflation rose in early 2012 mainly because of a sharp rise in world oil prices, and it has moderated since then as oil prices have declined. Core inflation, which excludes food and energy prices, also rose, but much less dramatically than the topline measure. Although core inflation does not include direct energy costs, it does reflect indirect costs, as energy is used to produce a wide range of goods and services throughout the economy. For example, airplane fares and trucking costs bear a close relationship to energy prices. Core inflation was 2.2 percent between June 2011 and June 2012; it had been only 1.6 percent over the preceding 12 months. Looking ahead, inflation is expected to edge down somewhat in the short term. As the economy recovers and unemployment declines in the medium term, inflation is expected to rise somewhat. In the long run, the CPI inflation rate is projected to be 2.2 percent per year. The other main measure of inflation in the projection is the chained price index for Gross Domestic Product. Year-over-year inflation by this measure is projected to be 1.7 percent in 2012, and 1.9 percent in 2017-2022. MID-SESSION REVIEW Interest Rates: The projections for interest rates are based on financial market data and market expectations at the time the forecast was developed. The three-month Treasury bill rate is expected to average only 0.1 percent in 2012 and 0.2 percent in 2013. It is expected to begin to rise in 2014 and to reach 3.8 percent by 2018. The yield on the 10-year Treasury note is projected to average just 2.0 percent in 2012, the lowest rate ever recorded for the 10-year note, which has been issued since 1953. As the economy continues to recover, the 10-year rate is expected to rise and to reach 5.1 percent by 2019. In the later years of the forecast, interest rates are close to their historical averages in real terms, given the projected rate of inflation. Incomes and Income Shares: Corporate profits have rebounded more quickly than labor compensation (which consists of wages and salaries and employee fringe benefits). As a result, corporate profits have risen as a share of total income, while labor compensation as a share of total income has fallen below its longrun average. As the economy recovers, this trend is expected to reverse. Labor compensation is projected to rise somewhat relative to total income, while the share of corporate profits is projected to fall. The wage share, excluding fringe benefits, is also expected to recover from its recent low level in step with the increase in compensation. FORECAST COMPARISONS A comparison of the MSR forecast with the most recent Blue Chip (an average of about 50 private-sector forecasts) and Federal Open Market Committee (FOMC) forecasts is shown in Table 3. For 2012, the Administration projects a real GDP growth rate (fourth quarter over fourth quarter) of 2.6 percent. This projection is above the Blue Chip Consensus and the range defined by the central tendency of the forecasts from the June FOMC meeting due to the Administration’s assumption that its additional economic recovery proposals will be adopted. For 2013, real GDP growth is also projected to be 2.6 percent, which is within the FOMC central tendency of forecasts and near the Blue Chip consensus of 2.5 percent. The Administration projects that the unemployment rate will average 8.0 percent in 2012, 7.7 percent in 2013, and 7.3 percent in 2014. The Blue Chip consensus is quite simi- 11 ECONOMIC ASSUMPTIONS Table 3. COMPARISON OF ECONOMIC ASSUMPTIONS (Calendar years; dollar amounts in billions) 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Nominal GDP: MSR ����������������������������������������������� 15,094 15,702 16,396 17,252 18,272 19,340 20,457 21,507 22,505 23,515 24,563 25,663 Budget ������������������������������������������� 15,106 15,779 16,522 17,397 18,448 19,533 20,651 21,689 22,666 23,659 24,688 25,760 Blue Chip 1 ������������������������������������� 15,094 15,683 16,326 17,153 18,056 18,989 19,949 20,918 21,884 22,902 23,967 25,082 percent change, fourth quarter over fourth quarter Real GDP: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip 1 ������������������������������������� FOMC Central Tendency �������������� 1.6 2.6 2.6 4.0 1.7 3.0 3.0 4.0 1.6 2.0 2.5 3.1 1.6 1.9–2.4 2.2–2.8 3.0–3.5 4.2 4.2 3.0 3.9 3.9 2.9 3.8 2.8 2.6 2.5 3.8 2.8 2.6 2.5 2.8 2.7 2.4 2.6 Longer Run Average: 2.3–2.5 2.5 2.5 2.4 2.5 2.5 2.6 percent change, year over year Real GDP: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� 1.7 1.8 1.7 2.3 2.7 2.1 2.7 3.0 2.3 3.5 3.6 3.0 4.1 4.1 3.0 4.0 4.0 2.9 3.8 3.9 2.8 3.2 3.2 2.7 2.7 2.7 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 GDP Price Index: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� 2.1 2.1 2.1 1.7 1.7 1.8 1.7 1.7 1.8 1.7 1.6 2.1 1.7 1.8 2.2 1.8 1.8 2.2 1.9 1.8 2.2 1.9 1.8 2.1 1.9 1.8 2.2 1.9 1.8 2.2 1.9 1.8 2.2 1.9 1.8 2.2 Consumer Price Index (CPI-U): MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� 3.1 3.2 3.1 2.1 2.2 2.0 1.9 1.9 1.9 2.0 2.0 2.4 2.0 2.0 2.4 2.1 2.1 2.4 2.2 2.1 2.5 2.2 2.1 2.5 2.2 2.1 2.5 2.2 2.1 2.5 2.2 2.1 2.5 2.2 2.1 2.5 5.7 5.4 5.4 5.4 5.8 5.5 5.4 5.4 6.1 5.9 5.8 5.8 Longer Run Average: 5.2–6.0 5.4 5.4 5.8 5.4 5.4 5.8 annual average in percent Unemployment Rate: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� FOMC Central Tendency 2 ������������ 8.9 8.0 7.7 7.3 9.0 8.9 8.6 8.1 9.0 8.2 7.8 7.2 8.7 8.0–8.2 7.5–8.0 7.0–7.7 6.7 7.3 6.7 6.2 6.5 6.4 91-Day Treasury Bills: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 1.1 1.4 1.3 2.3 2.7 2.4 3.3 3.9 3.2 3.6 4.1 3.6 3.8 4.1 3.7 3.8 4.1 3.7 3.8 4.1 3.7 3.8 4.1 3.7 3.8 4.1 3.7 10-Year Treasury Notes: MSR ����������������������������������������������� Budget ������������������������������������������� Blue Chip ��������������������������������������� 2.8 2.8 2.8 2.0 2.8 1.9 2.7 3.5 2.4 3.5 3.9 3.7 4.1 4.4 4.2 4.5 4.7 4.6 4.9 5.0 4.9 5.0 5.1 4.9 5.1 5.1 4.9 5.1 5.1 4.9 5.1 5.3 4.9 5.1 5.3 4.9 MSR = Mid-Session Review (forecast date June 2012) Budget = 2013 Budget (forecast date November 2011) FOMC = Federal Reserve Open Market Committee (forecast central tendency, date June 20, 2012) Blue Chip = July 2012 Blue Chip Consensus Forecast extended with March 2012 Blue Chip long-run survey Sources: Administration; Federal Open Market Committee Projections Materials, June 20, 2012; Blue Chip Economic Indicators, March and July 2012, Aspen Publishers. 1 Values for 2014–2022 interpolated by OMB from annual growth rates 2 Fourth quarter levels of unemployment rate. 12 lar: 8.2 percent in 2012, 7.8 percent in 2013, and 7.2 percent in 2014. The FOMC also projects that unemployment will fall. By the fourth quarter of 2012, the central tendency of the FOMC forecast ranges from 8.0 percent to 8.2 percent, in 2013:Q4 it ranges from 7.5 to 8.0 percent, and in 2014:Q4 it ranges from 7.0 to 7.7 percent. The Administration forecast is generally near the bottom of that range. The forecasts are similar for inflation and interest rates. The private forecasters expect MID-SESSION REVIEW inflation to rise to between 2 percent to 2-1/2 percent per year for both main measures of inflation, which is close to the average inflation rate of the past several years. The Administration forecast projects slightly less inflation, and slightly higher interest rates than the private consensus. The unusually low level of Federal interest rates that has prevailed since the financial crisis is expected to end but not until after another year of very low rates in 2013. Eventually, real interest rates return to near their historical averages. RECEIPTS The Mid-Session Review (MSR) estimates of receipts are below the February Budget estimates by $27 billion in 2012 and by $138 billion in 2013. In each subsequent year, the MSR estimates of receipts are below the February Budget estimates by amounts ranging from $27 billion to $52 billion, resulting in a $500 billion decrease in receipts over the 10-year budget horizon (2013 through 2022). The net reduction in 2012 receipts is in large part attributable to the effect of technical revisions based on new tax reporting data, collections to date, and other information, which decrease receipts by $68 billion. Revised economic assumptions reduce 2012 receipts by an additional $38 billion. These reductions are partially offset by a $58 billion increase in receipts attributable to a reduction in the estimated cost of the Administration’s proposals and a $21 billion increase in receipts attributable to a reduction in the estimated cost of expiring provisions extended in the adjusted baseline. The reductions in the cost of proposals and extensions in the adjusted baseline are due largely to later assumed enactment of these proposals than in the February Budget, which shifts net revenue losses from the proposals out of 2012 and into later years. The $138 billion reduction in 2013 receipts reflects revisions in the economic forecast, which reduce collections by $59 billion; technical re-estimates, which reduce receipts by $27 billion; and increases in the estimated cost of the Administration’s proposals and the expiring provisions extended in the adjusted baseline of $47 billion and $12 billion, respectively. The $500 billion reduction in receipts over the 10year budget horizon is primarily due to receipt losses of $260 billion and $224 billion, respectively attributable to revisions in the economic forecast and to technical revisions. Changes in the estimated cost of the Administration’s proposals, attributable to economic and technical revisions, reduce collections over the 10-year budget horizon by an additional $60 billion. Legislated tax changes and changes in the estimates of the provisions extended in the adjusted baseline offset these reductions by $18 billion and $25 billion, respectively. ENACTED LEGISLATION Legislation enacted since the February Budget was released increases receipts relative to the February estimates by a negligible amount in 2012, $6 billion in 2013, and a net $18 billion over the 10-year budget horizon. The bulk of this increase in receipts is due to enactment of the Middle Class Tax Relief and Job Creation Act of 2012. This Act included several of the Administration’s proposals, including the proposed extension of the temporary reduction in the Social Security payroll tax rate for employees and self-employed individuals and the proposed elimination of special rules modifying the timing of estimated tax payments by corporations, as well as modified versions of the Administration’s proposals to extend unemployment insurance benefits and to expand the shorttime compensation unemployment program. Enactment of these proposals had only a small effect on receipts relative to the February Budget, increasing receipts a net $3 billion over the 10-year budget horizon. This Act also included a provision to increase contributions to the Federal Employees Retirement System (FERS), effective for employees joining the Federal service after December 31, 2012. This provision, which was a modification of the Administration’s proposal to increase the contributions of all civilian employees to civil service retirement (CSRS) and FERS by smaller amounts, accounts for $7 billion of the net increase in receipts relative to the February Budget. Other legislation enacted since February that affects receipts includes the Moving Ahead for Progress in the 21st Century (MAP-21) Act and the FAA Modernization and Reform Act of 2012. Legislated changes enacted in MAP21, which include modification of the interest rate used for purposes of determining required contributions by employers to pension plans, account for $7 billion of the 10-year net increase in receipts relative to the February Budget. 13 14 REVISIONS IN EXPIRING PROVISIONS EXTENDED IN THE ADJUSTED BASELINE The February adjusted baseline permanently continued the 2001 and 2003 tax cuts for all taxpayers; permanently continued estate, gift, and generation-skipping transfer taxes at 2012 parameters; and reflected permanent extension of relief from the alternative minimum tax (AMT). Revisions in the estimated cost of these provisions increase receipts by $21 billion in 2012, reduce receipts by $12 billion in 2013, and increase receipts in each subsequent year for a net increase of $25 billion over the 10 years, 2013 through 2022. The $21 billion increase in 2012 is in large part attributable to delay in enacting the proposed extension of AMT relief, which expired on December 31, 2011. This delay in enactment, which pushes the cost of extension into 2013, is in large part responsible for the $12 billion increase in the estimated cost of extending these expiring provisions in 2013. The reduction in the cost of extending these expiring provisions in each subsequent year is due primarily to reductions in the economic forecast for wages and salaries and revisions to models of receipts, which were re-estimated using current collection experience and updated tax data for prior years. ECONOMIC CHANGES Revisions in the economic forecast reduce receipts by $38 billion in 2012, $59 billion in 2013, and declining amounts in each subsequent year, for a total reduction of $260 billion over the 10 years beginning in 2013 and running through 2022. In 2012, revisions to the economic forecast have the greatest effect on individual income taxes and social insurance and retirement receipts, reducing those sources of receipts by $22 billion and $12 billion, respectively. The reduction in 2012 individual income tax receipts is primarily attributable to reductions in the forecasts of wages and salaries and nonwage sources of personal income. Reductions in the forecast of wages and salaries and proprietor’s income, which are the tax base for Social Security and Medicare payroll taxes, the largest components of social insurance and retirement receipts, account for most of the $12 billion reduction in this source of receipts in 2012. MID-SESSION REVIEW Over the 10-year budget horizon, revisions in the economic forecast have the greatest effect on individual income taxes and social insurance and retirement receipts, reducing collections by $226 billion and $115 billion, respectively. Reductions in the economic forecast for wages and salaries, nonwage sources of personal income, and proprietor’s income account for most of the downward revision in these two sources of receipts. The reductions in individual income taxes and social insurance and retirement receipts are partially offset by net increases in corporation income taxes of $87 billion, due to changes in the forecast of GDP and other economic measures that affect the profitability of corporations. Revisions in the forecast of GDP, interest rates, other sources of income, and imports reduce other sources of receipts (excise taxes, estate and gift taxes, customs duties, and deposits of earnings by the Federal Reserve System) by a net $5 billion. TECHNICAL CHANGES Technical revisions in the estimates reduce receipts by $68 billion in 2012, $27 billion in 2013, and $13 billion to $30 billion in each subsequent year, for a decrease of $224 billion over the 10-year budget horizon. The net decrease in receipts in each year over the 10year budget horizon is primarily due to net downward re-estimates of corporation income taxes, along with reductions in individual income taxes and social insurance and retirement receipts, which are only partially offset by net upward re-estimates of the remaining sources of receipts. The technical revisions in both individual and corporation income taxes are in large part attributable to more recent collections data and revisions in the tax models based primarily on updated tax data for prior years, including updated data showing reduced profit margins in corporation income tax filings for tax year 2010 and reduced takeup of bonus depreciation provisions. More recent taxable wage data from employer returns accounts for most of the technical revision in social insurance and retirement receipts. REVISIONS IN PROPOSALS Revisions in the estimates of the Administration’s proposals that have not yet been enacted increase receipts by $58 billion in 2012, reduce receipts by $47 billion in 2013, 15 RECEIPTS and have a much smaller effect in subsequent years, reducing receipts by a net $60 billion over the 10 years, 2013 through 2022. The $58 billion increase in 2012 receipts is attributable to delay in enacting the Administration’s tax relief proposals. This delay in enactment increases the cost of these proposals in 2013 and accounts for much of the $47 billion increase in the cost of the Administration’s proposals in that year. Table 4. CHANGE IN RECEIPTS (In billions of dollars) 2012 February estimate ������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2013– 2022 2013– 2017 2022 2021 2,469 2,902 3,215 3,450 3,680 3,919 4,153 4,379 4,604 4,857 5,115 Changes due to enacted legislation ���� * 6 7 8 5 2 1 –1 –3 –4 –3 28 18 Changes due to economic and technical revisions in provisions extended in the adjusted baseline������ 21 –12 4 4 5 5 5 4 4 3 3 7 25 Changes due to revised economic assumptions: Individual income taxes ����������������� Corporation income taxes �������������� Social insurance and retirement ��� Other ����������������������������������������������� Subtotal, economic assumptions �������� –22 –2 –12 –2 –38 –25 –17 –12 –5 –59 –21 –16 –10 –2 –49 –23 –4 –11 –* –37 –23 3 –12 * –32 –24 9 –12 –1 –28 –24 15 –13 –2 –24 –24 20 –11 –1 –16 –22 25 –13 * –10 –21 26 –11 2 –4 –19 27 –10 2 –1 –115 –25 –57 –8 –204 –226 87 –115 –5 –260 Changes due to technical reestimates: Individual income taxes ����������������� Corporation income taxes �������������� Social insurance and retirement ��� Other ����������������������������������������������� Subtotal, technical reestimates ���������� –52 –28 11 1 –68 –10 –14 –4 1 –27 2 –19 –* 4 –13 2 –14 –5 2 –16 * –15 –6 1 –20 –2 –18 –4 1 –23 –4 –17 –3 –* –25 –4 –18 –1 1 –21 –4 –19 –2 2 –23 –6 –19 –4 3 –25 –10 –19 –5 3 –30 –9 –80 –19 8 –100 –36 –172 –33 17 –224 49 9 –32 –15 –3 7 –2 –7 –1 –4 –1 –7 –1 –3 –* 3 –* 6 –* 1 –* –1 –38 –27 –40 –20 58 –47 4 –9 –6 –8 –3 3 6 1 –1 –66 –60 –27 –138 –47 –51 –47 –52 –46 –31 –27 –29 –33 –334 –500 Changes due to economic and technical revisions in proposals: Temporary tax relief to create jobs and jumpstart growth ��������������� Other proposals ������������������������������ Subtotal, economic and technical revisions in proposals �������������������� Total change in receipts �������������������������� Mid-Session estimate �������������������������� *$500 million or less 2,442 2,764 3,169 3,400 3,633 3,867 4,107 4,348 4,577 4,827 5,083 EXPENDITURES Outlays for 2012 are now estimated to be $3,653 billion, $143 billion lower than the February Budget estimate, due to slowerthan-expected spending across a range of discretionary and mandatory programs, as well as the delay in enactment of proposals from the February Budget to promote nearterm economic and job growth. Relative to the February Budget, projected total outlays have decreased by $49 billion in 2013 and by $741 billion over 2013 to 2022. These reductions in outyear spending are primarily the cumulative downward effect of economic and technical reestimates in a number of mandatory programs, most notably Social Security, Medicare, and Medicaid. POLICY CHANGES Relative to the estimates in the February Budget, legislation enacted since the Budget was released has had only a modest impact on outlays, because the Budget already incorporated proposals similar to the enacted provisions. In 2012, enacted legislation increases spending by $1 billion. Enacted legislation continues to have a minimal effect on spending over the next 10 years, 2013 through 2022, increasing outlays by $2 billion over that time period. Middle Class Tax Relief and Job Creation Act of 2012. This act, passed in February, enacted several key provisions very similar to ones included in the February Budget, most notably an extension through the end of calendar year 2012 of the two-percentage point payroll tax holiday, emergency unemployment compensation, and relief from scheduled reductions in Medicare physician payments. Additional provisions in the act included the expansion of the FCC’s authority to auction spectrum rights and use of auction proceeds to help build an interoperable public safety broadband network. Reflecting the enactment of this legislation in the MSR increases spending relative to the February Budget by $1 billion in 2012 and increases spending relative to the Budget by $9 billion over the next 10 years. Moving Ahead for Progress in the 21st Century Act of 2012 (MAP-21 Act). At the end of June, Congress passed the MAP21 Act, which again enacted many provisions closely tied to key Budget proposals from February. These included a one-year suspension of the student loan interest rate increase scheduled for July 1st, reauthorization of surface transportation programs, and reforms in the National Flood Insurance Program. Reflecting the enactment of MAP21 in the MSR decreases spending relative to the February Budget by a negligible amount in 2012 and increases spending relative to the Budget by $2 billion over the next 10 years. ESTIMATING CHANGES Estimating changes are due to factors other than enacted legislation or changes in policy. These result from changes in economic assumptions, discussed earlier in this Review, and changes in technical factors. Relative to the Budget estimate, economic and technical changes decrease estimated outlays for 2012 by $144 billion while also decreasing outlays by an additional $743 billion from 2013 through 2022. Discretionary appropriations. Outlays for discretionary appropriations decrease by $55 billion in 2012 but increase by $24 billion over the next 10 years relative to the Budget as a result of technical revisions. These changes reflect lower outlays in 2012 compared to the February Budget for both security and non-security discretionary programs. The Departments of Defense, Education, Homeland Security, Housing and Urban Development, and Energy now expect significantly lower discretionary outlays in 2012 than were projected in the Budget due to lower-than-expected spending so far this fiscal year. As obligations previously expected to outlay in 2012 shift into 2013 and later years, spending for security programs rises by a total of $12 billion over 2013 through 2022, while spending for non-security related programs increases by $13 billion over this period. 17 18 Medicaid. Economic and technical revisions increase projected Federal outlays for Medicaid by $4 billion in 2012, but decrease outlays by $123 billion over the next 10 years from 2013 to 2022 relative to the February Budget estimates. The large decrease stems primarily from lower projected benefit payments in 2012 and 2013 and slightly slower projected growth throughout the 10-year budget window, offset by slight projected growth increases in the market basket and price indices used to calculate Medicaid benefits relative to the February Budget. Social Security. Estimating changes reduce outlays for Social Security by $4 billion in 2012 and by an additional $110 billion over the next 10 years. Lower spending in both the Old Age and Survivors’ Insurance (OASI) and Disability Insurance (DI) programs is partially due to lower cost-of-living adjustments (COLAs) starting in 2013 than were assumed in the February Budget. Technical changes have an even more pronounced effect on the lowered spending projections, most notably due to fewer-than-expected OASI beneficiaries in recent months and lower revised estimates of disability incidence than assumed in the February Budget. Medicare. Technical changes reduce outlays for Medicare by $9 billion in 2012 and by an additional $121 billion over the next 10 years, which is offset in part by economic changes, resulting in a net reduction over 2013 to 2022 of $97 billion. Projected outlays for all three parts of the Medicare program decrease significantly over the next 10 years due to these changes. The spending decrease in Part A is a result of revised cost and utilization estimates based on updated historical data. The Part A reduction is partially offset by higher projected outlays due to revised economic assumptions, most notably due to decreased productivity and increased CPI-W assumptions relative to the February Budget. The decrease in Medicare Part B spending is also due in large part to revised estimates of cost and utilization and a lower estimate of the ten-year cost of a zero percent physician payment update, offset somewhat by economic changes to productivity and CPI-W assumptions. The decrease in spending for Medicare Part D is due to lower drug prices and revised enrollment assumptions MID-SESSION REVIEW compared to the Budget, partially offset by lower estimated manufacturer rebates under proposed law. Unemployment compensation. Changes in economic and technical assumptions decrease outlays for unemployment benefits by $13 billion in 2012. Over 2013 through 2022, outlays are down by an additional $28 billion relative to the February Budget estimate. The reduction is driven by lower-than-expected insured unemployment rates as well as lower actual unemployment rates in 2012 than had been assumed in the February Budget. Additionally, the projection of the unemployment rate is lower from 2013 through 2017 than in the President’s Budget—averaging 6.7 percent in the MSR rather than 7.3 percent in the Budget—which contributes significantly to the downward revision in spending throughout the budget horizon. Supplemental Nutrition Assistance Program (SNAP). Outlays for SNAP decrease by $4 billion in 2012 and $26 billion over the next 10 years due to economic and technical factors. The technical changes arise from lower actual participation in the program than was assumed in the February Budget, while economic changes are due to a lower assumed cost of food in the Thrifty Food Plan and lower assumed unemployment relative to the Budget’s assumptions. FHA-Mutual Mortgage Insurance Fund. Technical changes lower net spending for the mandatory portion of the FHA-Mutual Mortgage Insurance Fund by $2 billion in 2012 and by an additional $19 billion relative to the Budget over the next 10 years. This reduction is attributable to receipt of mortgage servicing settlement funds and estimated gains to be realized upon the sale of long-term Treasury investments in the short term and increased projections of interest earnings in the outyears. Tennessee Valley Authority. Spending for the Tennessee Valley Authority (TVA) is virtually unchanged in 2012 but is revised downward by $16 billion over 2013 through 2022 to correct an error in the February Budget, which had failed to properly reflect the use of TVA’s excess revenues to pay down outstanding agency debt. EXPENDITURES Support for Government Sponsored Enterprises (GSEs). Lower draws requested by Fannie Mae and Freddie Mac from Treasury in 2012 under the Preferred Stock Purchase Agreement, net of dividends, result in $16 billion lower projected outlays for 2012 than in the February Budget. Gross draws by the GSEs for 2012 are now expected to be $23 billion, down from $40 billion in February. Dividends paid by the GSEs are virtually unchanged from February, while draws net of dividends fall from $21 billion to $5 billion. Student loan programs. Technical changes in student loans increase spending by $3 billion in 2012 and by an additional $10 billion over the next 10 years. The majority of the change is a result of downward revisions in loan volume relative to the February Budget, which reduce negative subsidy receipts. Deposit Insurance Fund. Technical changes lower deposit insurance spending in 2012 by $6 billion, but raise spending over 2013 through 2022 by $18 billion. The shortterm reduction in spending is attributable to fewer bank failures experienced to date than 19 were projected in the February Budget. The outyear spending increase can be attributed to a reduction in the projection of future bank failures relative to the February Budget, which lowers the future premiums the Fund is expected to receive, more than offsetting the lower outlays required as a result of fewer failures. Temporary investments to create jobs and jumpstart growth. The delay in enactment of the President’s proposals to create jobs and jumpstart growth reduces outlays in 2012 by $32 billion relative to the February Budget. These outlays shift into 2013 and 2014, increasing spending in those years by $30 billion and $2 billion respectively. Net interest. Excluding the debt service associated with enacted legislation and policy changes, outlays for net interest are projected to decrease from February by $6 billion in 2012 and by an additional $422 billion over 2013 to 2022. These reductions are virtually all due to the effect of lower short- and longterm Treasury interest rates over the next few years in the revised MSR economic forecast. 20 MID-SESSION REVIEW Table 5. CHANGE IN OUTLAYS (In billions of dollars) 2013– 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2022 February estimate ���������������������������������������� 3,796 3,803 3,883 4,060 4,329 4,532 4,728 5,004 5,262 5,537 5,820 Changes due to enacted legislation and other changes to policy: Middle Class Tax Relief and Job Creation Job Act of 2012 ������������������������������������� Moving Ahead for Progress in the 21st Century Act of 2012 ����������������������������� Other policy changes �������������������������������� Debt service ���������������������������������������������� Subtotal, enacted legislation and policy changes ������������������������������������������������������ 1 –5 1 –1 –1 * 3 4 3 3 3 –6 9 –* * * –* * –* –1 * –* –1 * –1 –* * –1 * * –1 1 * –2 1 * –1 1 * –1 1 –* –1 2 –* –1 –3 * –3 2 * –9 1 –6 –1 –2 –2 –1 2 3 2 3 4 –12 2 –38 –16 4 –4 –9 –13 –25 8 –7 –7 –15 –11 13 3 –6 –8 –12 –8 15 2 –7 –9 –8 –5 7 * –9 –10 –10 –3 1 1 –12 –11 –8 –1 –* * –14 –11 –10 –1 * –* –15 –12 –10 * –* –* –17 –12 –10 * –* –* –18 –15 –8 * * –* –18 –15 –7 * Changes due to reestimates: Discretionary appropriations: Security ������������������������������������������������� Non-Security ����������������������������������������� Medicaid �������������������������������������������������� Social Security ������������������������������������������ Medicare ��������������������������������������������������� Unemployment compensation ���������������� Supplemental Nutrition Assistance Program ����������������������������������������������� Mutual Mortgage Insurance Fund ���������� Tennessee Valley Authority ��������������������� Purchases of GSE preferred stock ����������� Student loan programs ���������������������������� Deposit Insurance Fund �������������������������� Temporary investments to create jobs and jumpstart growth �������������������������� Other programs ��������������������������������������� Net interest 1 ��������������������������������������������� Subtotal, reestimates ����������������������������������� –32 –3 –6 –144 30 2 –19 –43 2 ......... ......... ......... ......... ......... ......... ......... ......... 32 32 1 –3 4 1 3 * 1 2 2 5 13 –33 –43 –53 –55 –47 –44 –41 –41 –45 –203 –422 –52 –63 –79 –87 –81 –81 –83 –86 –88 –324 –743 Total change in outlays ������������������������������������ –143 –49 –53 –4 –1 –2 –4 –4 –4 –3 –2 –2 –2 –2 –16 –26 –2 –* –* –1 –1 –2 –2 –2 –3 –3 –4 –4 –19 –* –1 –1 –1 –2 –2 –2 –2 –2 –2 –2 –7 –16 –16 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 3 1 1 1 1 1 1 1 1 1 2 4 10 –6 2 * * 2 3 4 5 1 1 * 7 18 –65 –81 –88 –79 –78 –80 –83 –84 –336 –741 Mid-Session estimate ����������������������������������� 3,653 3,754 3,830 3,995 4,248 4,444 4,649 4,926 5,181 5,455 5,735 *$500 million or less. 1 Includes debt service on all reestimates. 2 Includes debt service. 12 12 13 13 –41 –123 –45 –110 –52 –97 –29 –28 SUMMARY TABLES 21 Table S–1. BUDGET TOTALS (In billions of dollars and as a percent of GDP) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 20132017 22 Totals 2011 20132022 Budget Totals in Billions of Dollars: Receipts ����������������������������������������������������������������� 2,303 2,442 2,764 3,169 3,400 3,633 3,867 4,107 4,348 4,577 4,827 5,083 16,832 39,774 Outlays ������������������������������������������������������������������ 3,603 3,653 3,754 3,830 3,995 4,248 4,444 4,649 4,926 5,181 5,455 5,735 20,271 46,218 Deficit ��������������������������������������������������������������� 1,300 1,211 991 661 595 615 576 543 578 604 627 652 3,439 6,444 Debt held by the public ����������������������������������������� 10,128 11,414 12,572 13,375 14,112 14,860 15,556 16,213 16,896 17,595 18,318 19,070 Debt net of financial assets ���������������������������������� 9,170 10,363 11,345 12,004 12,599 13,214 13,791 14,333 14,911 15,515 16,143 16,795 Gross domestic product (GDP) ��������������������������������� 14,953 15,538 16,226 17,012 18,009 19,071 20,172 21,258 22,256 23,261 24,296 25,383 Budget Totals as a Percent of GDP: Receipts ����������������������������������������������������������������� Outlays ������������������������������������������������������������������ Deficit ��������������������������������������������������������������� Debt held by the public ����������������������������������������� Debt net of financial assets ���������������������������������� 15.4% 24.1% 8.7% 67.7% 61.3% 15.7% 23.5% 7.8% 73.5% 66.7% 17.0% 23.1% 6.1% 77.5% 69.9% 18.6% 22.5% 3.9% 78.6% 70.6% 18.9% 22.2% 3.3% 78.4% 70.0% 19.0% 22.3% 3.2% 77.9% 69.3% 19.2% 22.0% 2.9% 77.1% 68.4% 19.3% 21.9% 2.6% 76.3% 67.4% 19.5% 22.1% 2.6% 75.9% 67.0% 19.7% 22.3% 2.6% 75.6% 66.7% 19.9% 22.5% 2.6% 75.4% 66.4% 20.0% 22.6% 2.6% 75.1% 66.2% 18.6% 22.4% 3.9% 19.1% 22.3% 3.2% MID-SESSION REVIEW Table S–2. EFFECT OF MID-SESSION REVIEW PROPOSALS ON PROJECTED DEFICITS (Deficit increases (+) or decreases (–) in billions of dollars) Projected deficits in the adjusted baseline 1 ������� 1,197 Percent of GDP ���������������������������������������������������������� 7.7% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 840 5.2% 705 4.1% 705 3.9% 766 4.0% 764 3.8% 752 3.5% 819 3.7% 884 3.8% 946 3.9% 1,126 4.4% 3,780 4.2% 8,306 4.0% 13 148 29 12 3 1 1 1 1 * –* 192 195 1 –4 –14 –29 –35 –47 –53 –61 –70 –75 –128 –127 –513 ......... ......... –54 –44 –58 –86 –71 –85 –85 –89 –96 –94 –103 –99 –110 –104 –117 –110 –125 –114 –133 –118 –364 –398 –952 –943 ......... ......... ......... ......... –26 –92 –96 –98 –101 –104 –107 –117 –624 ......... ......... –* 1 * 5 7 –89 –* 1 3 –154 –1 –* –5 –191 –2 –* –6 –243 –3 –* –7 –339 –4 –* –6 –360 –4 –* –5 –383 –4 –* –3 –406 –5 –* –7 –429 –5 –* –7 –498 –6 6 –9 –1,016 –28 6 –37 –3,092 Surface transportation reauthorization: Investments in surface transportation ��������������� ......... Reductions in overseas contingency operations ��� ......... Net cost of surface transportation reauthorization ��������������������������������������������� ......... * –16 4 –57 9 –75 13 –61 18 ......... 24 ......... 22 ......... 15 ......... 11 ......... 8 ......... 45 –210 125 –210 –16 –54 –67 –48 18 24 22 15 11 8 –165 –85 Tax cuts for families, individuals, and businesses 3 ���������������������������������������������������������� ......... 37 38 30 31 32 34 36 38 39 42 168 357 Debt service and indirect interest effects ������� –* –* –* –4 –13 –26 –41 –56 –72 –90 –110 –44 –412 Total proposals in the 2013 Mid-Session Review �������������������������������������������������������������� 13 79 –141 –219 –270 –314 –342 –379 –424 –469 –558 –865 –3,038 71 * 96 1 105 5 109 11 109 17 109 24 109 29 109 35 109 41 38 46 490 34 966 209 Proposals in the 2013 Mid-Session Review: 2 Short-term measures for jobs growth �������������� Net deficit reduction proposals: Health and other mandatory initiatives ������������� Allow Bush tax cuts to expire for high-income taxpayers ���������������������������������������������������������� Other revenue proposals �������������������������������������� Reductions in overseas contingency operations not reserved for surface transportation ���������� Proposed program integrity cap adjustment for IRS and Unemployment Insurance, including mandatory savings ������������������������������������������� Proposed BCA disaster relief cap adjustment ��� Outlay effects of discretionary policy ������������������ Total net deficit reduction proposals ���������������� Resulting deficits in 2013 Mid-Session Review �� 1,211 Percent of GDP ���������������������������������������������������������� 7.8% 71 97 110 120 127 133 139 145 150 84 524 1,175 991 6.1% 661 3.9% 595 3.3% 615 3.2% 576 2.9% 543 2.6% 578 2.6% 604 2.6% 627 2.6% 652 2.6% 3,439 3.9% 6,444 3.2% * $500 million or less. 1 See Tables S–4 and S–8 for information on the adjusted baseline. 2 For total deficit reduction since January 2011, see Table S–3. 3 Includes the effects of continuing certain expiring provisions through calendar year 2013. 23 Effect of replacing Joint Committee enforcement with 2013 Mid-Session Review deficit reduction proposals: Programmatic effects ������������������������������������������������ ......... Debt service �������������������������������������������������������������� ......... Total effect of replacing Joint Committee enforcement ����������������������������������������������������� ......... SUMMARY TABLES Totals 2012 Table S–3. DEFICIT REDUCTION SINCE JANUARY 2011 (Deficit reduction (–) or increase (+) in billions of dollars) 2013– 2022 Enacted appropriations 1���������������������������������������������������������������������������������������������������� –696 –676 Budget Control Act (BCA) discretionary caps for 2012 through 2021 2��������������������������� –901 –1,028 PAYGO legislation enacted during the 1st Session of the 112th Congress 3������������������� –7 –11 Legislation enacted to date in the 2nd Session of the 112th Congress �������������������������� 78 –12 2013 Mid-Session Review: Short-term measures for job growth ���������������������������������������������������������������������������� Tax cuts for families, individuals, and businesses 4������������������������������������������������������ Reauthorize surface transportation ����������������������������������������������������������������������������� 208 315 117 195 357 125 Health and other mandatory initiatives: Health savings ��������������������������������������������������������������������������������������������������������� Other mandatory savings ���������������������������������������������������������������������������������������� Other mandatory initiatives ������������������������������������������������������������������������������������ Subtotal, health and other mandatory initiatives ���������������������������������������������� Expiration of high income tax cuts ������������������������������������������������������������������������������ Other revenue proposals ����������������������������������������������������������������������������������������������� Cap Overseas Contingency Operations (OCO) funding ���������������������������������������������� –264 –181 61 –384 –819 –825 –727 –326 –254 67 –513 –952 –943 –834 Proposed program integrity cap adjustment for IRS and Unemployment Insurance, including mandatory savings ������������������������������������� Proposed BCA disaster relief cap adjustment ������������������������������������������������������������ Outlay effects of discretionary policy ��������������������������������������������������������������������������� –23 6 –31 –28 6 –37 Debt service ����������������������������������������������������������������������������������������������������������������������� –557 –746 Total deficit reduction since January 2011 ����������������������������������������������������������������� –4,247 –5,098 Memorandum, revenue and outlay effects: Enacted outlay reductions and 2013 MSR spending proposals ���������������������������������� Enacted receipt increases and 2013 MSR revenue proposals ����������������������������������� –3,047 –1,200 –3,625 –1,472 MID-SESSION REVIEW 1 Includes enactment of 2011 full-year appropriations and enactment of 2012 full-year OCO appropriations. Enactment of 2011 appropriations savings totaled through 2021. 2 Includes program integrity and the cap adjustment for proposed disaster relief. 3 Savings totaled through 2021. 4 Includes the effects of continuing certain expiring provisions through calendar year 2013. 24 2012– 2021 Table S–4. ADJUSTED BASELINE BY CATEGORY1 (In billions of dollars) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 Outlays: 699 600 1,300 682 582 1,264 672 577 1,248 678 551 1,229 685 546 1,231 693 548 1,241 706 555 1,261 721 562 1,283 736 574 1,310 753 586 1,338 769 598 1,367 787 611 1,398 3,434 2,776 6,210 7,200 5,706 12,906 Mandatory programs: Social Security �������������������������������������������������� Medicare2 ���������������������������������������������������������� Medicaid ����������������������������������������������������������� Troubled Asset Relief Program (TARP)5 �������� Other mandatory programs2 ���������������������������� Subtotal, mandatory programs �������������������� Net interest ����������������������������������������������������������� Adjustments for disaster costs6 ���������������������������� Joint Committee enforcement ������������������������������ Total outlays ����������������������������������������������������� 725 480 275 –38 631 2,073 230 ......... ......... 3,603 769 469 259 35 626 2,157 218 * ......... 3,639 813 513 276 12 580 2,193 228 2 –71 3,600 859 551 331 8 583 2,332 275 5 –96 3,745 908 577 364 5 609 2,463 346 7 –105 3,942 960 627 393 2 661 2,643 432 8 –109 4,215 1,015 650 419 1 671 2,756 518 9 –109 4,434 1,074 672 444 * 676 2,866 600 9 –109 4,648 1,137 737 472 * 715 3,062 673 10 –109 4,945 1,204 796 501 * 743 3,244 742 10 –109 5,225 1,272 859 532 ......... 792 3,456 804 10 –109 5,527 1,346 955 567 ......... 844 3,712 869 10 –38 5,951 4,555 2,918 1,783 29 3,103 12,387 1,798 31 –490 19,936 10,588 6,936 4,299 30 6,873 28,726 5,486 80 –966 46,232 Receipts: Individual income taxes ���������������������������������������� Corporation income taxes ������������������������������������� 1,091 181 1,126 251 1,246 336 1,376 373 1,492 398 1,617 417 1,746 438 1,870 455 1,991 468 2,115 480 2,242 494 2,373 507 7,478 1,961 18,068 4,365 Social insurance and retirement receipts: Social Security payroll taxes �������������������������� Medicare payroll taxes ������������������������������������ Unemployment insurance ������������������������������� Other retirement ���������������������������������������������� Excise taxes ����������������������������������������������������������� Estate and gift taxes ��������������������������������������������� Customs duties ������������������������������������������������������ Deposits of earnings, Federal Reserve System ���� Other miscellaneous receipts ������������������������������� Total receipts ���������������������������������������������������� 566 188 56 8 72 7 30 83 20 2,303 572 201 58 8 79 13 30 80 24 2,442 673 207 59 9 86 12 33 78 21 2,760 740 224 56 9 95 13 36 65 52 3,040 777 237 56 10 100 14 38 48 67 3,237 829 254 57 10 102 15 41 38 70 3,449 876 269 56 11 107 16 44 36 73 3,671 929 286 55 12 115 17 46 36 76 3,896 979 302 55 12 130 18 50 39 82 4,126 1,024 316 55 13 136 19 53 43 88 4,340 1,083 334 56 15 143 20 57 45 94 4,582 1,138 352 59 16 152 21 60 46 100 4,825 3,896 1,191 284 49 489 69 192 265 282 16,157 9,049 2,779 563 118 1,165 164 459 475 721 37,926 Deficit ����������������������������������������������������������������������� Net interest ����������������������������������������������������������� Primary deficit ��������������������������������������������������� 1,300 230 1,070 1,197 218 979 840 228 612 705 275 431 705 346 359 766 432 334 764 518 246 752 600 152 819 673 146 884 742 142 946 804 141 1,126 869 258 3,780 1,798 1,981 8,306 5,486 2,820 On-budget deficit ��������������������������������������������������� Off-budget deficit/surplus (–) �������������������������������� 1,367 –67 1,259 –62 872 –32 733 –28 723 –18 788 –23 784 –20 773 –22 836 –17 888 –4 947 –2 1,117 9 3,901 –121 8,462 –156 25 Appropriated (“discretionary”) programs:2 Defense3 ������������������������������������������������������������ Non-defense4 ����������������������������������������������������� Subtotal, appropriated programs ����������������� SUMMARY TABLES Totals 2011 Table S–4. ADJUSTED BASELINE BY CATEGORY1—Continued (In billions of dollars) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 Memorandum, budget authority for appropriated programs:2 Defense3 ����������������������������������������������������������������� Non-defense4 ��������������������������������������������������������� 710 507 670 523 664 509 676 519 688 529 702 539 717 551 733 563 748 576 765 589 781 601 800 616 3,446 2,648 7,273 5,593 Total, appropriated funding ����������������������������� 1,217 1,193 1,173 1,195 1,217 1,241 1,268 1,296 1,324 1,353 1,382 1,417 6,094 12,866 26 Totals 2011 * $500 million or less. 1 See Table S–8 for information on adjustments to the Budget Enforcement Act (BEA) baseline. 2 Does not include effects of Joint Committee enforcement. 3 Reflects revision in security category to consist of accounts in defense function (050). 4 Reflects revision in nonsecurity category to consist of accounts not in the defense function (050). 5 Outlays for TARP result from obligations incurred through October 3, 2010 for the Home Affordable Modification Program and other TARP programs. 6 These amounts represent a placeholder for major disasters requiring Federal assistance for relief and reconstruction. Such assistance might be provided in the form of discretionary or mandatory outlays or tax relief. These amounts are included as outlays for convenience. MID-SESSION REVIEW Table S–5. PROPOSED BUDGET BY CATEGORY (In billions of dollars) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 Outlays: 838 462 1,300 830 434 1,264 826 418 1,245 781 395 1,176 765 387 1,152 764 386 1,150 773 391 1,164 786 397 1,183 803 405 1,208 820 415 1,236 837 420 1,257 856 430 1,287 3,909 1,977 5,886 8,012 4,045 12,057 Mandatory programs: Social Security �������������������������������������������������� Medicare ����������������������������������������������������������� Medicaid ����������������������������������������������������������� Troubled Asset Relief Program (TARP)2 �������� Other mandatory programs ����������������������������� Subtotal, mandatory programs �������������������� Net interest ����������������������������������������������������������� Adjustments for disaster costs3 ���������������������������� Total outlays ����������������������������������������������������� 725 480 275 –38 631 2,073 230 ......... 3,603 769 469 259 35 638 2,169 219 * 3,653 813 508 276 12 670 2,279 229 2 3,754 859 539 331 8 636 2,373 276 5 3,830 908 562 361 5 652 2,489 347 7 3,995 960 608 390 2 701 2,661 429 8 4,248 1,015 626 411 1 709 2,762 510 9 4,444 1,074 644 436 * 721 2,874 583 9 4,649 1,136 706 464 * 755 3,061 646 10 4,926 1,203 758 493 * 776 3,231 705 10 5,181 1,271 813 525 ......... 822 3,432 756 10 5,455 1,345 901 559 ......... 828 3,634 804 10 5,735 4,554 2,843 1,769 29 3,370 12,565 1,790 31 20,271 10,585 6,665 4,246 30 7,272 28,797 5,284 80 46,218 Receipts: Individual income taxes ���������������������������������������� Corporation income taxes ������������������������������������� 1,091 181 1,126 251 1,292 294 1,464 402 1,600 425 1,744 442 1,890 463 2,025 479 2,158 491 2,292 503 2,432 515 2,575 527 7,990 2,026 19,472 4,542 Social insurance and retirement receipts: Social Security payroll taxes �������������������������� Medicare payroll taxes ������������������������������������ Unemployment insurance ������������������������������� Other retirement ���������������������������������������������� Excise taxes ����������������������������������������������������������� Estate and gift taxes ��������������������������������������������� Customs duties ������������������������������������������������������ Deposits of earnings, Federal Reserve System ���� Other miscellaneous receipts ������������������������������� Total receipts ���������������������������������������������������� 566 188 56 8 72 7 30 83 20 2,303 572 201 58 8 79 13 30 80 24 2,442 673 207 57 10 86 13 33 78 21 2,764 741 225 55 11 96 23 36 65 52 3,169 776 237 67 12 102 25 38 48 67 3,400 828 255 71 13 104 27 41 38 71 3,633 875 270 65 13 109 29 44 36 73 3,867 928 287 66 14 117 32 46 36 77 4,107 978 303 65 15 132 34 50 39 82 4,348 1,022 317 68 16 138 37 53 43 88 4,577 1,082 335 65 17 146 40 57 45 94 4,827 1,138 353 68 18 154 43 60 47 100 5,083 3,893 1,194 314 59 497 118 192 266 284 16,832 9,040 2,790 645 138 1,184 303 458 475 726 39,774 Deficit ����������������������������������������������������������������������� Net interest ����������������������������������������������������������� Primary deficit/surplus (–) ������������������������������ 1,300 230 1,070 1,211 219 992 991 229 762 661 276 386 595 347 248 615 429 186 576 510 67 543 583 –40 578 646 –68 604 705 –101 627 756 –128 652 804 –152 3,439 1,790 1,649 6,444 5,284 1,160 On-budget deficit ��������������������������������������������������� Off-budget deficit/surplus (–) �������������������������������� 1,367 –67 1,277 –66 1,032 –41 689 –28 611 –16 633 –18 595 –18 561 –18 596 –17 608 –4 630 –2 644 9 3,559 –121 6,597 –153 27 Appropriated (“discretionary”) programs:1 Security ������������������������������������������������������������ Nonsecurity ������������������������������������������������������ Subtotal, appropriated programs ����������������� SUMMARY TABLES Totals 2011 Table S–5. PROPOSED BUDGET BY CATEGORY—Continued (In billions of dollars) Memorandum, budget authority for appropriated programs:1 Security ������������������������������������������������������������������ Nonsecurity ����������������������������������������������������������� Total, appropriated funding ����������������������������� 847 370 1,217 2012 816 377 1,193 2013 788 358 1,146 2014 743 366 1,108 2015 756 373 1,129 2016 769 381 1,150 2017 785 389 1,174 2018 802 398 1,199 2019 819 407 1,225 2020 836 416 1,251 2021 853 425 1,277 2022 874 435 1,309 2013– 2017 3,841 1,866 5,707 2013– 2022 28 Totals 2011 8,023 3,946 11,969 * $500 million or less. 1 Discretionary spending levels other than overseas contingency operations reflect the budget authority caps under the Budget Control Act of 2011. The split of discretionary spending between security and nonsecurity after 2013 is based on increasing budget authority in each category by the growth rate in the aggregate discretionary cap. 2 Outlays for TARP result from obligations incurred through October 3, 2010 for the Home Affordable Modification Program and other TARP programs. 3 These amounts represent a placeholder for major disasters requiring Federal assistance for relief and reconstruction. Such assistance might be provided in the form of discretionary or mandatory outlays or tax relief. These amounts are included as outlays for convenience. MID-SESSION REVIEW Table S–6. PROPOSED BUDGET BY CATEGORY AS A PERCENT OF GDP (As a percent of GDP) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 Outlays: 5.6 3.1 8.7 5.3 2.8 8.1 5.1 2.6 7.7 4.6 2.3 6.9 4.2 2.1 6.4 4.0 2.0 6.0 3.8 1.9 5.8 3.7 1.9 5.6 3.6 1.8 5.4 3.5 1.8 5.3 Mandatory programs: Social Security ��������������������������������������������������������� Medicare ������������������������������������������������������������������ Medicaid ������������������������������������������������������������������ Troubled Asset Relief Program (TARP) 2 ��������������� Other mandatory programs ������������������������������������ Subtotal, mandatory programs ��������������������������� Net interest ������������������������������������������������������������������ Adjustments for disaster costs 3 ����������������������������������� Total outlays ������������������������������������������������������������ 4.8 3.2 1.8 –0.3 4.2 13.9 1.5 ......... 24.1 4.9 3.0 1.7 0.2 4.1 14.0 1.4 * 23.5 5.0 3.1 1.7 0.1 4.1 14.0 1.4 * 23.1 5.0 3.2 1.9 * 3.7 14.0 1.6 * 22.5 5.0 3.1 2.0 * 3.6 13.8 1.9 * 22.2 5.0 3.2 2.0 * 3.7 14.0 2.3 * 22.3 5.0 3.1 2.0 * 3.5 13.7 2.5 * 22.0 5.1 3.0 2.1 * 3.4 13.5 2.7 * 21.9 5.1 3.2 2.1 * 3.4 13.8 2.9 * 22.1 5.2 3.3 2.1 * 3.3 13.9 3.0 * 22.3 Receipts: Individual income taxes ����������������������������������������������� Corporation income taxes �������������������������������������������� 7.3 1.2 7.2 1.6 8.0 1.8 8.6 2.4 8.9 2.4 9.1 2.3 9.4 2.3 9.5 2.3 9.7 2.2 9.9 2.2 10.0 2.1 Social insurance and retirement receipts: Social Security payroll taxes ��������������������������������� Medicare payroll taxes ������������������������������������������� Unemployment insurance �������������������������������������� Other retirement ����������������������������������������������������� Excise taxes ������������������������������������������������������������������ Estate and gift taxes ���������������������������������������������������� Customs duties ������������������������������������������������������������� Deposits of earnings, Federal Reserve System ����������� Other miscellaneous receipts �������������������������������������� Total receipts ����������������������������������������������������������� 3.8 1.3 0.4 0.1 0.5 * 0.2 0.6 0.1 15.4 3.7 1.3 0.4 0.1 0.5 0.1 0.2 0.5 0.2 15.7 4.1 1.3 0.4 0.1 0.5 0.1 0.2 0.5 0.1 17.0 4.4 1.3 0.3 0.1 0.6 0.1 0.2 0.4 0.3 18.6 4.3 1.3 0.4 0.1 0.6 0.1 0.2 0.3 0.4 18.9 4.3 1.3 0.4 0.1 0.5 0.1 0.2 0.2 0.4 19.0 4.3 1.3 0.3 0.1 0.5 0.1 0.2 0.2 0.4 19.2 4.4 1.4 0.3 0.1 0.5 0.1 0.2 0.2 0.4 19.3 4.4 1.4 0.3 0.1 0.6 0.2 0.2 0.2 0.4 19.5 4.4 1.4 0.3 0.1 0.6 0.2 0.2 0.2 0.4 19.7 Deficit ������������������������������������������������������������������������������ 8.7 7.8 6.1 3.9 3.3 3.2 2.9 2.6 2.6 Net interest ������������������������������������������������������������������ Primary deficit/surplus (–) ������������������������������������� 1.5 7.2 1.4 6.4 1.4 4.7 1.6 2.3 1.9 1.4 2.3 1.0 2.5 0.3 2.7 –0.2 On-budget deficit ���������������������������������������������������������� Off-budget deficit/surplus (–) ��������������������������������������� 9.1 –0.4 8.2 –0.4 6.4 –0.3 4.0 –0.2 3.4 –0.1 3.3 –0.1 2.9 –0.1 2.6 –0.1 3.4 1.7 5.2 3.4 1.7 5.1 4.4 2.2 6.6 3.9 2.0 5.9 5.2 5.3 3.3 3.6 2.2 2.2 ......... ......... 3.4 3.3 14.1 14.3 3.1 3.2 * * 22.5 22.6 5.0 3.1 1.9 * 3.7 13.9 1.9 * 22.4 5.1 3.2 2.0 * 3.5 13.9 2.5 * 22.3 10.1 2.1 8.8 2.2 9.3 2.2 4.5 1.4 0.3 0.1 0.6 0.2 0.2 0.2 0.4 19.9 4.5 1.4 0.3 0.1 0.6 0.2 0.2 0.2 0.4 20.0 4.3 1.3 0.3 0.1 0.5 0.1 0.2 0.3 0.3 18.6 4.4 1.3 0.3 0.1 0.6 0.1 0.2 0.2 0.3 19.1 2.6 2.6 2.6 3.9 3.2 2.9 –0.3 3.0 –0.4 3.1 –0.5 3.2 –0.6 1.9 1.9 2.5 0.8 2.7 –0.1 2.6 –* 2.6 –* 2.5 * 4.0 –0.1 3.3 –0.1 29 Appropriated (“discretionary”) programs: 1 Security ������������������������������������������������������������������� Nonsecurity ������������������������������������������������������������ Subtotal, appropriated programs ������������������������ SUMMARY TABLES Averages 2011 Table S–6. PROPOSED BUDGET BY CATEGORY AS A PERCENT OF GDP—Continued (As a percent of GDP) Memorandum, budget authority for appropriated programs: Security ������������������������������������������������������������������������� Nonsecurity ����������������������������������������������������������������� Subtotal, appropriated programs ��������������������������� 5.7 2.5 8.1 2012 5.3 2.4 7.7 2013 4.9 2.2 7.1 2014 4.4 2.1 6.5 2015 4.2 2.1 6.3 2016 4.0 2.0 6.0 2017 3.9 1.9 5.8 2018 3.8 1.9 5.6 2019 3.7 1.8 5.5 2020 3.6 1.8 5.4 2021 3.5 1.7 5.3 2022 3.4 1.7 5.2 2013– 2017 4.3 2.1 6.3 30 Averages 2011 2013– 2022 3.9 1.9 5.9 *0.05 percent of GDP or less. 1 Discretionary spending levels other than overseas contingency operations reflect the budget authority caps under the Budget Control Act of 2011. The split of discretionary spending between security and nonsecurity after 2013 is based on increasing budget authority in each category by the growth rate in the aggregate discretionary cap. 2 Outlays for TARP result from obligations incurred through October 3, 2010 for the Home Affordable Modification Program and other TARP programs. 3 These amounts represent a placeholder for major disasters requiring Federal assistance for relief and reconstruction. Such assistance might be provided in the form of discretionary or mandatory outlays or tax relief. These amounts are included as outlays for convenience. MID-SESSION REVIEW Table S–7. PROPOSED BUDGET IN POPULATION- AND INFLATION-ADJUSTED DOLLARS (In billions of constant dollars, adjusted for population growth) 2014 2015 2016 2017 2018 2019 2020 2021 2022 Outlays: Appropriated (“discretionary”) programs:1 Security ���������������������������������������������������������������������������������� Nonsecurity ��������������������������������������������������������������������������� Subtotal, appropriated programs ��������������������������������������� 826 418 1,245 759 384 1,143 721 365 1,086 699 353 1,052 686 347 1,033 676 341 1,018 670 338 1,008 663 336 999 656 329 985 650 327 977 Mandatory programs: Social Security ������������������������������������������������������������������������ Medicare ��������������������������������������������������������������������������������� Medicaid ��������������������������������������������������������������������������������� Troubled Asset Relief Program (TARP)2 ������������������������������� Other mandatory programs ��������������������������������������������������� Subtotal, mandatory programs ������������������������������������������ Net interest ��������������������������������������������������������������������������������� Adjustments for disaster costs3 �������������������������������������������������� Total outlays ��������������������������������������������������������������������������� 813 508 276 12 670 2,279 229 2 3,754 834 524 322 8 618 2,306 268 5 3,721 856 530 341 5 615 2,347 327 7 3,767 878 557 357 2 642 2,436 393 8 3,889 901 555 365 1 629 2,451 452 8 3,944 924 554 375 * 620 2,473 501 8 4,000 947 589 387 * 629 2,553 539 8 4,107 972 612 399 * 627 2,611 570 8 4,188 996 637 411 ......... 644 2,688 592 8 4,273 1,022 685 425 ......... 629 2,760 611 8 4,355 Receipts: Individual income taxes �������������������������������������������������������������� Corporation income taxes ����������������������������������������������������������� 1,292 294 1,422 390 1,509 401 1,597 405 1,677 411 1,742 412 1,799 410 1,853 407 1,905 403 1,955 400 Social insurance and retirement receipts Social Security payroll taxes ������������������������������������������������ Medicare payroll taxes ���������������������������������������������������������� Unemployment insurance ����������������������������������������������������� Other retirement �������������������������������������������������������������������� Excise taxes ��������������������������������������������������������������������������������� Estate and gift taxes ������������������������������������������������������������������� Customs duties ���������������������������������������������������������������������������� Deposits of earnings, Federal Reserve System �������������������������� Other miscellaneous receipts ����������������������������������������������������� Total receipts �������������������������������������������������������������������������� 673 207 57 10 86 13 33 78 21 2,764 720 218 53 11 93 22 34 63 51 3,078 732 224 63 12 96 24 36 46 63 3,206 758 233 65 12 95 25 38 35 65 3,326 777 240 57 12 96 26 39 32 65 3,433 798 247 57 12 100 27 40 31 66 3,533 815 253 54 12 110 29 41 33 68 3,625 826 256 55 13 112 30 43 34 71 3,699 848 263 51 13 114 31 45 35 74 3,782 864 268 51 14 117 32 46 35 76 3,860 Deficit ��������������������������������������������������������������������������������������������� Net interest ��������������������������������������������������������������������������������� Primary deficit/surplus (–) ���������������������������������������������������� On-budget deficit ������������������������������������������������������������������������� Off-budget deficit/surplus (–) ������������������������������������������������������ 991 229 762 1,032 –41 643 268 375 669 –27 561 327 234 576 –15 563 393 170 580 –16 512 452 59 528 –16 467 501 –34 483 –16 482 539 –57 497 –14 488 570 –82 491 –3 491 592 –101 493 –2 495 611 –115 489 7 SUMMARY TABLES 2013 31 Table S–7. PROPOSED BUDGET IN POPULATION- AND INFLATION-ADJUSTED DOLLARS—Continued 2013 Memorandum, budget authority for appropriated programs:1 Security ���������������������������������������������������������������������������������������� 788 Nonsecurity �������������������������������������������������������������������������������� 358 Subtotal, appropriated programs ������������������������������������������ 1,146 Memorandum, index of population growth and inflation ������ 1.00 2014 2015 2016 2017 32 (In billions of constant dollars, adjusted for population growth) 2018 2019 2020 2021 2022 721 355 1,077 713 352 1,064 704 348 1,053 697 345 1,042 690 342 1,032 683 339 1,022 675 336 1,011 668 333 1,001 663 330 994 1.03 1.06 1.09 1.13 1.16 1.20 1.24 1.28 1.32 *$500 million or less. 1 Discretionary spending levels other than overseas contingency operations reflect the budget authority caps under the Budget Control Act of 2011. The split of discretionary spending between security and nonsecurity after 2013 is based on increasing budget authority in each category by the growth rate in the aggregate discretionary cap. 2 Outlays for TARP result from obligations incurred through October 3, 2010 for the Home Affordable Modification Program and other TARP programs. 3 These amounts represent a placeholder for major disasters requiring Federal assistance for relief and reconstruction. Such assistance might be provided in the form of discretionary or mandatory outlays or tax relief. These amounts are included as outlays for convenience. MID-SESSION REVIEW Table S–8. BRIDGE FROM BUDGET ENFORCEMENT ACT BASELINE TO ADJUSTED BASELINE (Deficit increases (+) or decreases (–) in billions of dollars) 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 BEA baseline deficit ������������������������������������������������������������������� 1,300 1,197 Adjustments for current policy: Index to inflation the 2011 parameters of the AMT ����������������� Continue the 2001 and 2003 tax cuts ��������������������������������������� Extend estate, gift, and generation-skipping transfer taxes at current parameters ���������������������������������������������������������������� Prevent reduction in Medicare physician payments ���������������� Reflect incremental cost of funding existing Pell maximum grant award ���������������������������������������������������������������������������� 2013– 2017 2013– 2022 666 492 459 475 425 370 384 394 399 438 2,517 4,502 ......... ......... ......... ......... 135 116 113 180 127 195 145 211 165 223 188 231 213 238 238 245 266 253 295 260 685 926 1,886 2,153 ......... ......... ......... ......... 6 13 32 26 36 31 40 37 44 40 48 37 52 44 56 49 59 54 63 63 158 147 436 394 ......... ......... –1 –1 7 7 7 5 5 5 5 5 18 45 Subtotal ��������������������������������������������������������������������������������� ......... ......... 269 350 396 441 479 510 552 593 637 687 1,935 4,914 Adjustments for provisions contained in the Budget Control Act: Set discretionary budget authority at cap levels ���������������������� Reflect Joint Committee enforcement ��������������������������������������� Make program integrity adjustments ��������������������������������������� Subtotal ��������������������������������������������������������������������������������� ......... ......... ......... ......... ......... –* ......... –* –25 –47 –61 –70 –76 –81 –87 –92 –99 –103 –71 –96 –105 –109 –109 –109 –109 –109 –109 –38 –* –2 –3 –4 –4 –5 –6 –6 –7 –8 –96 –145 –169 –184 –190 –195 –202 –208 –215 –149 –280 –490 –13 –783 –742 –966 –44 –1,752 10 31 80 Reclassify surface transportation outlays: Remove outlays from appropriated category ���������������������������� –48 –53 –55 –56 –58 –58 –59 –59 –60 –60 –61 –62 Add outlays to mandatory category ������������������������������������������ 48 53 55 56 58 58 59 59 60 60 61 62 Subtotal ��������������������������������������������������������������������������������� ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –286 286 ......... –588 588 ......... Adjustments for disaster costs 1 ���������������������������������������������� ......... Total program adjustments ������������������������������������������������������� ......... Debt service on adjustments ����������������������������������������������������� ......... Total adjustments ����������������������������������������������������������������� ......... * 2 5 7 8 9 9 10 10 10 –* –* –* 174 * 174 210 3 213 235 11 246 266 25 291 298 41 339 323 58 381 360 75 435 395 94 490 432 115 547 548 140 688 1,183 80 1,263 3,242 562 3,804 Adjusted baseline deficit ���������������������������������������������������������� 1,300 1,197 840 705 705 766 764 752 819 884 946 1,126 3,780 8,306 SUMMARY TABLES Totals *$500 million or less. 1 These amounts represent a placeholder for major disasters requiring Federal assistance for relief and reconstruction. Such assistance might be provided in the form of discretionary or mandatory outlays or tax relief. These amounts are included as outlays for convenience. 33 Table S–9. CHANGE IN THE ADJUSTED BASELINE FROM BUDGET TO MSR (Dollar amounts in billions) February deficits in the adjusted baseline ���������� Percent of GDP ������������������������������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 20132017 34 Totals 2012 20132022 1,127 7.2% 772 4.7% 662 3.9% 749 4.1% 862 4.5% 815 4.0% 793 3.7% 862 3.8% 944 4.0% 1,011 4.1% 1,193 4.7% 87 43 51 –16 –53 –5 2 8 –6 –4 –5 20 15 1 * * –1 * * –7 * 1 –10 –* 3 –8 –* 4 –5 –* 3 –2 –* 4 –1 –* 4 2 –* 4 4 –* 4 3 –* 4 –31 –* 13 –25 –1 33 88 42 45 –22 –57 –6 3 11 1 3 2 2 22 Revisions due to updated economic assumptions: Receipts ������������������������������������������������������������� 38 59 49 37 32 28 24 16 10 4 1 204 260 Mandatory outlays: Medicare ���������������������������������������������������������� Unemployment compensation ����������������������� Social Security ������������������������������������������������� Supplemental Security Income Program ������� Supplemental Nutrition Assistance Program ��� Medicaid ��������������������������������������������������������� Other ���������������������������������������������������������������� Net interest ������������������������������������������������������� Subtotal, economic revisions ��������������������������������� –* –2 * –* ......... ......... 1 –7 29 * –5 –2 –* ......... ......... –2 –24 26 1 –4 –3 –1 –1 * –2 –37 2 2 –3 –3 –1 –1 * –* –43 –13 3 –3 –3 –1 –1 * –* –47 –21 4 –2 –3 –1 –1 * * –48 –23 4 –1 –2 –1 –1 1 1 –42 –18 4 –* –1 –1 –1 1 1 –39 –20 5 –* * –1 –1 1 2 –35 –19 6 –* 2 –1 –1 1 2 –35 –22 6 * 3 –1 –1 1 3 –38 –25 9 –17 –13 –5 –4 1 –4 –200 –29 33 –19 –11 –9 –8 5 5 –388 –133 Revisions due to updated technical assumptions: Receipts �������������������������������������������������������������� 47 39 9 12 15 18 20 17 20 22 28 92 198 Discretionary outlays: Defense ������������������������������������������������������������ Non-defense ����������������������������������������������������� –27 –27 –28 11 5 5 7 2 4 2 * 1 * * * –* * –* * –* * –* –11 21 –11 21 Mandatory outlays: Medicare ���������������������������������������������������������� Medicaid ��������������������������������������������������������� Social Security ������������������������������������������������� Unemployment compensation ����������������������� Supplemental Nutrition Assistance Program ���� Mutual Mortgage Insurance Fund ����������������� Tennessee Valley Authority ���������������������������� Purchases of GSE preferred stock ������������������ –9 4 –4 –11 –4 –2 –* –16 –16 –7 –5 –6 –1 –* –1 ......... –14 –7 –6 –4 –2 –* –1 ......... –11 –7 –7 –2 –3 –1 –1 ......... –15 –9 –7 –* –3 –1 –2 ......... –14 –12 –8 * –3 –2 –2 ......... –17 –13 –9 1 –2 –2 –2 ......... –18 –15 –11 * –1 –2 –2 ......... –19 –17 –12 * –1 –3 –2 ......... –20 –18 –17 * –1 –3 –2 ......... –19 –19 –18 –* –1 –4 –2 ......... –69 –41 –32 –12 –11 –4 –7 ......... –162 –122 –99 –11 –18 –19 –16 ......... MID-SESSION REVIEW Revisions due to enacted legislation and other policy changes: Middle Class Tax Relief and Job Creation Job Act of 2012 ������������������������������������������������������ Moving Ahead for Progress in the 21st Century Act of 2012 ��������������������������������������� Other policy changes ������������������������������������������ Debt service �������������������������������������������������������� Subtotal, enacted legislation and other policy changes ���������������������������������������������������������������� Table S–9. CHANGE IN THE ADJUSTED BASELINE FROM BUDGET TO MSR—Continued (Dollar amounts in billions) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Direct student loans ���������������������������������������� Deposit Insurance Fund ��������������������������������� Other ���������������������������������������������������������������� Net interest ������������������������������������������������������� Subtotal, technical revisions ��������������������������������� Total changes since February ��������������������������������� 3 –6 6 2 –46 71 1 2 5 6 * 68 1 * 4 5 –5 43 1 * –2 1 –9 –44 1 2 1 –5 –18 –96 1 3 * –7 –22 –51 1 4 1 –7 –26 –41 1 5 1 –8 –34 –43 1 1 1 –9 –41 –59 1 1 1 –11 –47 –65 2 * 2 –13 –44 –67 MSR deficits in the adjusted baseline ��������������� Percent of GDP ������������������������������������������������������� 1,197 7.7% 840 5.2% 705 4.1% 705 3.9% 766 4.0% 764 3.8% 752 3.5% 819 3.7% 884 3.8% 946 3.9% 1,126 4.4% Memorandum, budget authority for appropriated programs: February budget authority ������������������������������������� 1,195 1,146 1,173 1,199 1,226 1,256 1,287 1,318 1,350 1,383 1,474 Change in budget authority: Defense ������������������������������������������������������������ Non-defense ����������������������������������������������������� ......... –2 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –2 1,193 ......... 1,146 ......... 1,173 ......... 1,199 ......... 1,226 ......... 1,256 ......... 1,287 ......... 1,318 ......... 1,350 ......... 1,383 Total change in budget authority ��������������� MSR budget authority: ������������������������������������������ 20132017 20132022 4 7 9 1 –54 –80 10 18 14 –48 –245 –356 ......... ......... ......... ......... ......... ......... ......... 1,474 ......... ......... SUMMARY TABLES Totals 2012 *$500 million or less. 35 Table S–10. MANDATORY AND RECEIPT PROPOSALS (Deficit increases (+) or decreases (–) in millions of dollars) 2013 2014 2021 2022 36 Totals 2012 2015 2016 2017 2018 2019 2020 –8,077 –5,701 –4,196 –2,751 –1,798 –1,154 –893 –804 10,603 3,203 736 869 749 668 341 329 294 170 122 22,617 23,873 2013– 2017 2013– 2022 Temporary Tax Relief and Investments to Create Jobs and Jumpstart Growth: Tax initiatives: Extend 100-percent first-year depreciation deduction for certain property ���������������� Provide a temporary 10-percent tax credit for new jobs and wage increases 1 ���������� Provide additional tax credits for investment in qualified property used in a qualified advanced energy manufacturing project ���������������������������� Provide tax credit for energy-efficient commercial building property expenditures in place of exisitng tax deduction ������������������������������������������������� Reform and extend Build America bonds 1 ����� ......... 39,383 –10,806 ......... 19,595 851 1,426 1,206 415 24 –72 –114 –57 –21 –7 3,922 3,651 ......... ......... 400 2 517 4 367 3 232 4 115 3 32 4 –2 4 –2 4 –2 4 –2 6 1,631 16 1,655 38 800 625 2,667 ......... ......... 2,133 ......... ......... 533 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 3,600 11,250 7,733 3,600 11,250 7,733 1,800 2,100 1,020 600 180 ......... ......... ......... ......... 5,820 6,000 131 174 189 139 69 44 28 16 4 839 1,000 450 400 ......... ......... ......... ......... ......... ......... ......... 1,000 1,000 12,090 478 ......... 6,000 1,230 237 2,250 1,351 5,250 899 ......... 3,000 ......... 237 ......... 23 3,650 1,186 ......... ......... ......... 238 ......... ......... 1,480 1,487 ......... ......... ......... 238 ......... ......... 1,560 1,684 ......... ......... ......... ......... ......... ......... 960 1,411 ......... ......... ......... ......... ......... ......... 640 1,183 ......... ......... ......... ......... ......... ......... 320 859 ......... ......... ......... ......... ......... ......... 80 547 ......... ......... ......... ......... ......... ......... 42,560 4,157 22,500 27,000 4,110 1,000 4,750 1,743 46,120 9,841 22,500 27,000 4,110 1,000 4,750 1,743 1 ......... ......... ......... ......... ......... ......... ......... ......... 2 2 7,100 3,200 ......... ......... ......... ......... ......... ......... ......... 14,950 14,950 29,087 11,784 2,515 558 1,047 834 936 453 –54 191,803 195,019 Mandatory initiatives: Enact Reemployment NOW ����������������������� 400 2,800 Create a Pathways Back to Work fund ����� 1,250 10,625 Establish a community college initiative ���� 267 2,400 Provide HomeStar rebates for energy efficient home retrofits ��������������������������� ......... 300 Develop a national network of manufacturing innovation institutes ���� ......... 206 Establish advanced vehicles community development challenge �������������������������� ......... 150 Invest in immediate surface transportation priorities ������������������������� 3,880 20,090 Create infrastructure bank ����������������������� 22 107 Provide for teacher stabilization ��������������� 2,500 22,500 Modernize schools �������������������������������������� 3,000 18,000 Support first responders ����������������������������� 890 2,880 Support VA conservation jobs �������������������� ......... 50 Strengthen the teaching profession ���������� 250 2,500 Continue temporary SNAP assistance ����� ......... 369 Help entrepreneurs and small businesses access capital and grow ������������������������� 1 1 Rehabilitate and repurpose vacant property (neighborhood stabilization) ��� 50 4,650 Total, temporary tax relief and investments to create jobs and jumpstart growth ������������������������������� 12,510 147,859 MID-SESSION REVIEW ......... Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) SUMMARY TABLES Totals 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 Tax Proposals: Tax cuts for families and individuals: Extend exclusion from income for cancellation of certain home mortgage debt ���������������������������������������������������������� Extend American opportunity tax credit (AOTC) 1 �������������������������������������������������� Provide for automatic enrollment in IRAs, including an employer tax credit, and doubling of the tax credit for small employer plan start-up costs 1 ��������������� Expand earned income tax credit (EITC) for larger families 1 ��������������������������������� Expand child and dependent care tax credit 1 ����������������������������������������������������� Provide exclusion from income for student loan forgiveness for students after 25 years of income-based or incomecontingent repayment ����������������������������� Provide exclusion from income for student loan forgiveness and for certain scholarship amounts for participants in the IHS Health Professions Programs ��� Total, tax cuts for families and individuals �������������������������������������������� 1,329 1,507 355 ......... ......... ......... ......... ......... ......... ......... 3,191 3,191 ......... 670 12,114 12,883 13,961 14,045 15,225 15,542 16,481 17,001 18,260 53,673 136,182 ......... ......... 707 1,160 1,243 1,341 1,503 1,719 1,950 2,243 2,622 4,451 14,488 ......... 72 1,412 1,448 1,475 1,502 1,524 1,555 1,587 1,619 1,649 5,909 13,843 ......... 252 934 949 956 957 956 950 938 928 916 4,048 8,736 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 5 13 13 13 13 13 14 14 14 15 57 127 ......... 2,328 16,687 16,808 17,648 17,858 19,221 19,780 20,970 21,805 23,462 71,329 176,567 ......... 10 8 8 8 8 9 10 10 10 11 42 92 ......... 19 103 242 394 517 617 702 732 644 456 1,275 4,426 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 10,879 7,676 8,481 9,332 10,202 11,074 11,921 12,754 13,593 14,448 46,570 110,360 ......... 29 181 285 457 676 510 479 182 –314 –311 1,628 2,174 ......... 44 227 261 310 371 389 177 –42 –25 –15 1,213 1,697 37 Incentives for expanding manufacturing and insourcing jobs in America: Provide tax incentives for locating jobs and business activity in the United States and remove tax deductions for shipping jobs overseas ���������������������������� Provide new Manufacturing Communities tax credit ������������������������������������������������� Target the domestic production activities deduction to domestic manufacturing activities and double the deduction for advanced manufacturing activities �������� Enhance and make permanent the research and experimentation tax credit ���������������� Provide a tax credit for the production of advanced technology vehicles ����������������� Provide a tax credit for medium- and heavy-duty alternative-fuel commercial vehicles ���������������������������������������������������� ......... Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Extend and modify certain energy incentives 1 ���������������������������������������������� Total, incentives for expanding manufacturing and insourcing jobs in America ������������������������������������������������ Tax cuts for small business: Eliminate capital gains taxation on investments in small business stock ������ Double the amount of expensed start-up expenditures �������������������������������������������� Expand and simplify the tax credit provided to qualified small employers for non-elective contributions to employee health insurance 1 ������������������ Total, tax cuts for small business ������������ Incentives to promote regional growth: Extend and modify the New Markets tax credit �������������������������������������������������������� Designate Growth Zones 1 �������������������������� Modify tax-exempt bonds for Indian tribal governments �������������������������������������������� Allow current refundings of State and local governmental bonds 3 �������������������� Reform and expand the Low-Income Housing tax credit ����������������������������������� Total, incentives to promote regional growth ��������������������������������������������������� Continue certain expiring provisions through calendar year 2013 1, 3 �������������� ......... 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 1,359 2,223 846 320 137 50 98 126 139 149 4,885 5,447 ......... 12,340 10,418 10,123 10,821 11,911 12,649 13,387 13,762 14,047 14,738 55,613 124,196 ......... ......... ......... ......... ......... 214 619 1,018 1,525 2,079 2,536 214 7,991 ......... 328 323 320 318 316 313 308 306 304 303 1,605 3,139 ......... ......... 310 638 1,205 1,528 1,757 2,077 1,684 2,002 1,463 1,993 1,263 2,195 1,101 2,427 1,012 2,843 724 3,107 484 3,323 6,419 8,238 11,003 22,133 ......... ......... 86 ......... 184 533 306 973 397 931 465 884 513 844 528 138 466 –453 310 –425 129 –369 1,438 3,321 3,384 3,056 ......... 2 4 8 11 15 19 24 27 31 35 40 176 ......... 38 100 184 274 370 469 572 675 780 889 966 4,351 ......... 6 17 35 55 76 98 119 142 165 191 189 904 ......... 132 838 1,506 1,668 1,810 1,943 1,381 857 861 875 5,954 11,871 ......... 21,196 9,826 1,022 460 174 95 175 211 297 342 32,678 33,798 ......... –4,317 –9,016 –9,889 –10,901 –11,926 –12,943 –13,969 –15,018 –16,113 –17,245 –46,049 –121,337 ......... –1,500 –3,157 –3,439 38 Totals 2012 Upper-income tax provisions: –5,983 –15,863 –41,747 ......... –21,317 –31,739 –34,623 –38,100 –41,573 –45,055 –48,604 –52,297 –56,221 –60,253 –167,352 –429,782 ......... –19,451 –198,516 ......... –6,897 –3,717 –4,050 –4,413 –4,779 –5,154 –5,555 –8,970 –14,154 –18,892 –21,325 –22,005 –22,515 –23,025 –23,703 –24,476 –82,792 2,999 664 –3,054 –5,348 –5,823 –6,186 –6,530 –6,863 –7,205 –11,636 –44,243 MID-SESSION REVIEW Sunset the Bush tax cuts for those with income in excess of $250,000 ($200,000 if single): Reinstate the limitation on itemized deductions for upper-income taxpayers ��� Reinstate the personal exemption phaseout for upper-income taxpayers ��� Reinstate the 36% and 39.6% rates for upper-income taxpayers ���������������������� Tax qualified dividends as ordinary income for upper-income taxpayers ���� Tax net long-term capital gains at a 20% rate for upper-income taxpayers ��������� Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Subtotal, sunset the Bush tax cuts for those with income in excess of $250,000 ($200,000 if single) 4 ���� Reduce the value of certain tax expenditures �������������������������������������������� Total, upper-income tax provisions ��������� Modify estate and gift tax provisions: Restore the estate, gift and generationskipping transfer (GST) tax parameters in effect in 2009 ��������������������������������������� Require consistency in value for transfer and income tax purposes ������������������������ Modify rules on valuation discounts ���������� Require a minimum term for grantor retained annuity trusts (GRATs) ����������� Limit duration of GST tax exemption �������� Coordinate certain income and transfer tax rules applicable to grantor trusts ���� Extend the lien on estate tax deferrals provided under section 6166 ����������������� Total modify estate and gift tax provisions ��������������������������������������������� 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 ......... –53,482 –49,883 –61,441 –74,664 –84,222 –90,239 –96,053–102,024–108,455–115,162 –323,692 2013– 2022 –835,625 ......... –26,320 –42,900 –46,572 –50,897 –55,942 –60,983 –65,352 –69,862 –74,854 –79,995 –222,631 –573,677 ......... –79,802 –92,783–108,013–125,561–140,164–151,222–161,405–171,886–183,309–195,157 –546,323 –1,409,302 ......... –253 –8,479 –9,732 –10,621 –11,623 –12,706 –13,886 –15,104 –16,456 –17,700 –40,708 –116,560 ......... ......... –154 –794 –165 –1,425 –173 –1,521 –183 –1,632 –193 –1,758 –205 –1,900 –219 –2,054 –232 –2,209 –247 –2,380 –262 –2,558 –868 –7,130 –2,033 –18,231 ......... ......... –41 ......... –85 ......... –144 ......... –207 ......... –275 ......... –349 ......... –429 ......... –514 ......... –605 ......... –713 ......... –752 ......... –3,362 ......... ......... –23 –31 –39 –50 –65 –82 –106 –134 –171 –216 –208 –917 ......... –5 –9 –13 –16 –17 –18 –19 –20 –21 –22 –60 –160 ......... –1,270 –10,194 –11,622 –12,709 –13,931 –15,260 –16,713 –18,213 –19,880 –21,471 –49,726 –141,263 ......... –2,639 –4,500 –4,679 –4,863 –5,059 –5,257 –5,446 –5,644 –2,812 –889 –21,740 –41,788 ......... –3,514 –5,993 –6,232 –6,477 –6,738 –7,001 –7,254 –7,517 –7,806 –8,112 –28,954 –66,644 ......... –1,469 –2,595 –2,523 –2,468 –2,398 –2,356 –2,314 –2,250 –2,169 –2,107 –11,453 –22,649 ......... –30 –67 –95 –124 –154 –185 –217 –252 –289 –330 –470 –1,743 ......... –110 –209 –227 –239 –245 –257 –272 –272 –289 –310 –1,030 –2,430 ......... –222 –382 –401 –421 –442 –464 –487 –512 –537 –564 –1,868 –4,432 ......... –514 –883 –933 –988 –1,044 –1,101 –1,154 –1,207 –1,261 –1,296 –4,362 –10,381 ......... –158 –218 –229 –240 –252 –265 –278 –292 –307 –322 –1,097 –2,561 ......... –280 –296 –307 –320 –332 –345 –358 –371 –385 –400 –1,535 –3,394 39 Reform U.S. international tax system: Defer deduction of interest expense related to deferred income of foreign subsidiaries ��������������������������������������������� Determine the foreign tax credit on a pooling basis �������������������������������������������� Tax currently excess returns associated with transfers of intangibles offshore ���� Limit shifting of income through intangible property transfers ����������������� Disallow the deduction for excess nontaxed reinsurance premiums paid to affiliates ��������������������������������������������������� Limit earnings stripping by expatriated entities ����������������������������������������������������� Modify tax rules for dual capacity taxpayers ������������������������������������������������� Tax gain from the sale of a partnership interest on look-through basis ���������������� Prevent use of leveraged distributions from related foreign corporations to avoid dividend treatment ����������������������� 2013 SUMMARY TABLES Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Extend section 338(h)(16) to certain asset acquisitions ��������������������������������������������� Remove foreign taxes from a section 902 corporation’s foreign tax pool when earnings are eliminated �������������������������� Total reform U.S. international tax system ��������������������������������������������������� Reform treatment of financial and insurance industry institutions and products: Require accrual of income on forward sale of corporate stock ������������������������������������ Require ordinary treatment of income from day-to-day dealer activities for certain dealers of equity options and commodities ��������������������������������������������� Modify rules that apply to sales of life insurance contracts ��������������������������������� Modify proration rules for life insurance company general and separate accounts��� Expand pro rata interest expense disallowance for corporate- owned life insurance (COLI) ������������������������������������ Total reform treatment of financial and insurance industry institutions and products ������������������������������������������������ 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –60 –100 –100 –100 –100 –100 –100 –100 –100 –100 –460 –960 ......... –10 –20 –27 –36 –46 –50 –50 –50 –50 –50 –139 –389 ......... –9,006 –15,263 –15,753 –16,276 –16,810 –17,381 –17,930 –18,467 –16,005 –14,480 –73,108 –157,371 ......... –4 –11 –18 –26 –34 –38 –40 –42 –44 –46 –93 –303 ......... –152 –240 –254 –270 –286 –303 –321 –341 –361 –383 –1,202 –2,911 ......... –11 –36 –44 –55 –68 –80 –94 –110 –127 –148 –214 –773 ......... –463 –798 –776 –781 –799 –803 –798 –757 –736 –711 –3,617 –7,422 ......... –20 –65 –167 –252 –399 –601 –831 –1,180 –1,579 –1,996 –903 –7,090 ......... –650 –1,150 –1,259 –1,384 –1,586 –1,825 –2,084 –2,430 –2,847 –3,284 –6,029 –18,499 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –1,667 ......... –7 –2,305 –11 –1,807 –11 –1,715 –11 –1,405 –11 –948 –10 –636 –10 –428 –10 –311 –10 –255 –10 –8,899 –51 –11,477 –101 40 Totals 2012 Eliminate fossil fuel tax preferences: Subtotal, eliminate oil and gas preferences ����������������������������������� ......... –9 –11 –10 –9 –8 –8 –7 –7 –7 –6 –47 –82 ......... –637 –1,110 –1,187 –1,241 –1,282 –1,319 –1,347 –1,370 –1,391 –1,422 –5,457 –12,306 ......... –61 –222 –336 –305 –220 –139 –59 –5 7 2 –1,144 –1,338 ......... –2,381 –3,659 –3,351 –3,281 –2,926 –2,424 –2,059 –1,820 –1,712 –1,691 –15,598 –25,304 MID-SESSION REVIEW Eliminate oil and gas preferences: Repeal enhanced oil recovery credit 5 ����� Repeal credit for oil and gas produced from marginal wells 5 �������������������������� Repeal expensing of intangible drilling costs ������������������������������������������������������ Repeal deduction for tertiary injectants � Repeal exception to passive loss limitations for working interests in oil and natural gas properties ������������� Repeal percentage depletion for oil and natural gas wells ���������������������������������� Increase geological and geophysical amortization period for independent producers to seven years ��������������������� Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Eliminate coal preferences: Repeal expensing of exploration and development costs �������������������������������� Repeal percentage depletion for hard mineral fossil fuels ������������������������������� Repeal capital gains treatment for royalties ������������������������������������������������ Subtotal, eliminate coal preferences Total eliminate fossil fuel tax preferences 6 �������������������������������� 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –26 –44 –46 –48 –50 –50 –48 –46 –43 –39 –214 –440 ......... –154 –158 –164 –165 –167 –172 –178 –185 –192 –202 –808 –1,737 ......... –11 –25 –31 –38 –43 –47 –51 –55 –58 –63 –148 –422 ......... –191 –227 –241 –251 –260 –269 –277 –286 –293 –304 –1,170 –2,599 ......... –2,572 –3,886 –3,592 –3,532 –3,186 –2,693 –2,336 –2,106 –2,005 –1,995 –16,768 –27,903 ......... –54 ......... –1,432 –73 –2,068 –73 –2,019 –72 –1,932 –74 –2,083 –74 –2,159 –73 –2,209 –71 –2,223 –70 –2,233 –70 –2,293 –346 –9,534 –704 –20,651 ......... –1,010 –1,416 –1,448 –1,482 –1,517 –1,549 –1,574 –1,598 –1,621 –1,646 –6,873 –14,861 ......... ......... –9,382 –8,464 –8,344 –8,399 –9,050 –8,547 –8,216 –8,577 –8,216 –34,589 –77,195 ......... ......... –6,199 –2,455 –1,517 –1,531 –303 –317 –331 –347 –363 –11,702 –13,363 ......... –46 –148 –227 –257 –302 –320 –236 –141 –109 –106 –980 –1,892 ......... –96 –163 –168 –173 –178 –183 –189 –194 –200 –206 –778 –1,750 ......... –1,286 –1,932 –1,913 –1,698 –1,421 –1,158 –1,097 –1,162 –1,008 –762 –8,250 –13,437 ......... –2 –6 –6 –7 –7 –7 –7 –8 –8 –8 –28 –66 ......... –6 –67 –74 –83 –89 –94 –97 –100 –105 –111 –319 –826 ......... ......... –5 ......... –63 –24 –69 –35 –77 –35 –82 –36 –87 –36 –90 –37 –94 –37 –97 –39 –103 –40 –296 –130 –767 –319 ......... –37 –51 –53 –55 –59 –61 –64 –68 –71 –74 –255 –593 ......... –3,974 –21,592 –17,004 –15,732 –15,778 –15,081 –14,537 –14,243 –14,485 –13,998 –74,080 –146,424 41 Other revenue changes and loophole closers: Increase Oil Spill Liability Trust Fund financing rate by one cent and update the law to include other sources of crudes 3 ���������������������������������������������������� Reinstate Superfund taxes ������������������������� Make unemployment insurance surtax permanent 3 �������������������������������������������� Repeal LIFO method of accounting for inventories ����������������������������������������������� Repeal lower-of-cost-or-market inventory accounting method ���������������������������������� Eliminate special depreciation rules for purchases of general aviation passenger aircraft ����������������������������������� Repeal gain limitation for dividends received in reorganization exchanges ���� Tax carried (profits) interests as ordinary income ������������������������������������������������������ Expand the definition of built-in loss for purposes of partnership loss transfers � Extend partnership basis limitation rules to nondeductible expenditures ��������������� Limit the importation of losses under section 267(d) ����������������������������������������� Deny deduction for punitive damages ������� Eliminate the deduction for contributions of conservation easements on golf courses ����������������������������������������������������� Total, other revenue changes and loophole closers ������������������������������������ 2013 SUMMARY TABLES Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 42 Totals 2012 2013– 2022 Reduce the tax gap and make reforms: Expand information reporting: Require information reporting for private separate accounts of life insurance companies ��������������������������� Require a certified Taxpayer Identification Number (TIN) from contractors and allow certain withholding ������������������������������������������ Improve compliance by businesses: Require greater electronic filing of returns �������������������������������������������������� Authorize the Department of the Treasury to require additional information to be included in electronically filed Form 5500 Annual Reports ������������������������������������������������� Implement standards clarifying when employee leasing companies can be held liable for their clients’ Federal employment taxes ������������������������������� Increase certainty with respect to worker classification ���������������������������� Repeal special estimated tax payment provision for certain insurance companies ��������������������������������������������� ......... –1 –1 –1 –1 –1 –1 –1 –1 –2 –4 –10 ......... –53 –90 –123 –129 –135 –141 –147 –154 –161 –168 –530 –1,301 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –4 –5 –6 –6 –6 –7 –7 –8 –8 –8 –27 –65 ......... –65 –322 –635 –776 –864 –956 –1,052 –1,152 –1,256 –1,366 –2,662 –8,444 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –50 –221 –105 –128 –161 –192 –210 –214 –216 –217 –665 –1,714 ......... –1 –1 –1 –1 –1 –1 –1 –1 –1 –1 –5 –10 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –1 –1 –1 –1 –2 –2 –2 –2 –10 ......... ......... ......... –1 –1 –1 –1 –1 –1 –1 –1 –3 –8 ......... ......... ......... ......... ......... ......... ......... ......... –1 –1 –4 –1 –4 –1 –4 –1 –4 –2 –4 –2 –4 –2 –5 –2 –25 –10 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... MID-SESSION REVIEW Strengthen tax administration: Streamline audit and adjustment procedures for large partnerships ������� Revise offer-in-compromise application rules ������������������������������������������������������ Expand IRS access to information in the National Directory of New Hires for tax administration purposes ��������������� Make repeated willful failure to file a tax return a felony ������������������������������������� Facilitate tax compliance with local jurisdictions ������������������������������������������ Extend statute of limitations where State adjustment affects Federal tax liability ������������������������������������������������� Improve investigative disclosure statute ��� Require taxpayers who prepare their returns electronically but file their returns on paper to print their returns with a 2-D bar code ������������������������������ ......... Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Allow the IRS to absorb credit and debit card processing fees for certain tax payments ���������������������������������������������� Improve and make permanent the provision authorizing the IRS to disclose certain return information to certain prison officials ������������������������� Extend IRS math error authority in certain circumstances 1 ����������������������� Impose a penalty on failure to comply with electronic filing requirements ����� Total, reduce the tax gap and make reforms ����������������������������������������� Simplify the tax system: Simplify the rules for claiming the EITC for workers without qualifying children 1 ���� Eliminate minimum required distribution (MRD) requirements for IRA/plan balances of $75,000 or less ��������������������� Allow all inherited plan and IRA accounts to be rolled over within 60 days ������������� Clarify exception to recapture of unrecognized gain on sale of stock to an ESOP ������������������������������������������������������� Repeal non-qualified preferred stock designation ���������������������������������������������� Repeal preferential dividend rule for publicly offered REITs ���������������������������� Reform excise tax based on investment income of private foundations ���������������� Remove bonding requirements for certain taxpayers subject to Federal excise taxes on distilled spirits, wine, and beer ����������� Simplify arbitrage investment restrictions Simplify single-family housing mortgage bond targeting requirements ������������������ Streamline private business limits on governmental bonds �������������������������������� Total, simplify the tax system ����������������� 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –1 –1 –2 –2 –2 –2 –2 –2 –2 –2 –8 –18 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –7 –16 –17 –16 –17 –18 –19 –19 –21 –21 –73 –171 ......... ......... ......... ......... –1 –1 –1 –1 –2 –2 –2 –2 –10 ......... –181 –657 –891 –1,064 –1,195 –1,326 –1,447 –1,562 –1,677 –1,796 –3,988 –11,796 ......... 36 486 497 506 514 522 532 542 552 563 2,039 4,750 ......... 5 8 13 19 27 36 46 58 72 86 72 370 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –30 –49 –49 –48 –45 –42 –37 –33 –29 –26 –221 –388 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 4 4 5 5 5 5 6 6 7 7 23 54 ......... ......... ......... 2 ......... 10 ......... 18 ......... 28 ......... 38 ......... 46 ......... 58 ......... 68 ......... 76 ......... 87 ......... 96 ......... 431 ......... ......... ......... ......... 1 1 1 3 3 3 3 2 15 ......... ......... 1 18 3 462 5 489 7 518 9 549 11 579 13 621 15 659 17 698 19 739 25 2,036 100 5,332 ......... 1 5 8 13 19 25 32 36 41 43 46 223 43 Trade initiatives: Establish Reconstruction Opportunity Zones 3 ����������������������������������������������������� 2013 SUMMARY TABLES Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Other initiatives: Authorize the limited sharing of business tax return information to improve the accuracy of important measures of our economy ��������������������������������������������������� Eliminate certain reviews conducted by the U.S. Treasury Inspector General for Tax Administration (TIGTA) ������������������ Modify indexing to prevent deflationary adjustments ��������������������������������������������� Total, other initiatives ����������������������������� Total, tax proposals �������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 44 Totals 2012 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –60,802 –105,761 –126,101 –143,128 –158,336 –168,081 –178,649 –189,569 –199,352 –208,659 –594,128 –1,538,438 Mandatory Initiatives and Savings: Invest in surface transportation: Reauthorize surface transportation for six years (outlays from Transportation Trust Fund) �������������������������������������������� Invest in immediate surface transportation priorities (non-add; shown above under “Temporary tax relief and investments to create jobs and jumpstart growth”) ������� ......... 267 3,763 8,646 13,437 18,492 24,063 22,478 15,099 10,645 8,038 44,605 124,928 3,880 20,090 12,090 5,250 3,650 1,480 1,560 960 640 320 80 42,560 46,120 ......... ......... 291 –46 –3,560 –106 –2,729 –159 –1,536 –222 –1,788 –222 –3,079 –227 –4,445 –221 –4,607 –216 –4,496 –211 –4,340 –211 –9,322 –755 –30,289 –1,841 ......... –8 –4 2 2 2 2 1 1 1 1 –6 ......... ......... –22 –22 –22 –22 –22 –22 –22 –22 –22 –22 –110 –220 ......... –20 –27 –27 –28 –29 –30 –31 –32 –33 –34 –131 –291 ......... –13 –13 –13 –13 –13 –13 –13 –13 –13 –13 –65 –130 ......... ......... ......... –27 –1 ......... –27 ......... 198 –27 ......... 151 –27 ......... 93 –27 ......... 59 –27 ......... 9 –27 ......... ......... –27 ......... ......... –27 ......... ......... –27 ......... ......... –135 –1 501 –270 –1 510 ......... ......... –1 –14 –13 –13 –14 –14 –14 –14 –14 –41 –111 ......... 154 –3,562 –2,838 –1,766 –2,053 –3,401 –4,772 –4,930 –4,815 –4,660 –10,065 –32,643 Health and other mandatory proposals: Total, Agriculture ����������������������������� MID-SESSION REVIEW Agriculture: Reduce agriculture subsidies ����������������� Better target conservation spending ����� Permanently reauthorize stewardship contracting ������������������������������������������ Enact Natural Resources Conservation Service (NRCS) fee ������������������������������ Enact Animal Plant and Health Inspection Service (APHIS) fee ���������� Enact Food Safety and Inspection Service (FSIS) fee �������������������������������� Enact Grain Inspection, Packers, and Stockyards Administration (GIPSA) fees ������������������������������������������������������� Impose biobased labeling fee ������������������ Extend funding for Secure Rural Schools ��� Outyear mandatory effects of discretionary changes to the Conservation Stewardship Program ���� Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Education: Provide mandatory appropriation to sustain recent Pell Grant increases ���� Reform and expand Perkins loan program ����������������������������������������������� Adjust guaranty agency loan rehabilitation compensation ��������������� Overhaul TEACH Grants and replace with Presidential Teaching Fellows ��� Eliminate in-school interest subsidies for current undergraduates after 150 percent of program length ������������������� Establish career academies �������������������� Outyear mandatory effects of discretionary changes to the Vocational Rehabilitation State Grants program ����������������������������������� Total, Education ����������������������������� Energy: Reauthorize special assessment from domestic nuclear utilities 2 ���������������� Repeal ultra-deepwater oil and gas research and development program ��� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... 1,055 4,372 4,194 58 183 675 703 724 746 9,679 12,710 ......... –644 –1,768 –1,395 –1,113 –900 –727 –640 –594 –554 –515 –5,820 –8,850 ......... –3,390 ......... ......... ......... ......... ......... ......... ......... ......... ......... –3,390 –3,390 ......... ......... 105 152 156 150 137 –2 –61 –77 –86 563 474 ......... ......... –80 10 –159 110 –180 270 –51 350 ......... 200 ......... 60 ......... ......... ......... ......... ......... ......... ......... ......... –470 940 –470 1,000 ......... ......... –40 –61 –66 –67 –70 –70 –72 –73 –75 –234 –594 ......... –4,104 –697 3,158 3,470 –559 –417 –37 –24 20 70 1,268 880 ......... –204 –208 –212 –217 –221 –226 –231 –235 –240 –1,041 –2,194 –200 ......... –20 –40 –30 –10 ......... ......... ......... ......... ......... ......... –100 –100 ......... –220 –244 –238 –222 –217 –221 –226 –231 –235 –240 –1,141 –2,294 Bad debts: Reduce Medicare coverage of patients’ bad debts ������������������ ......... –310 –1,020 –1,910 –2,410 –2,620 –2,810 –2,990 –3,190 –3,410 –3,640 –8,270 –24,310 Graduate medical education: Align graduate medical education payments with patient care costs ����������������������������������������� ......... ......... –860 –960 –980 –1,010 –1,050 –1,110 –1,180 –1,260 –1,340 –3,810 –9,750 Better align payments to rural providers with the cost of care: Reduce Critical Access Hospital (CAH) payments from 101% of reasonable costs to 100% of reasonable costs ���������������������� ......... –70 –120 –120 –130 –130 –140 –150 –170 –180 –190 –570 –1,400 Total, Energy ������������������������������������ SUMMARY TABLES Totals 2012 Health and Human Services (HHS): Health proposals: Medicare providers: 45 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Prohibit CAH designation for facilities that are less than 10 miles from the nearest hospital ������������������������������������ Cut waste, fraud, and improper payments in Medicare: Reduce fraud, waste, and abuse in Medicare ����������������������������� Dedicate penalties for failure to use electronic health records toward deficit reduction ���������� Update Medicare payments to more appropriately account for utilization of advanced imaging ������������������������������������ Require prior authorization for advanced imaging ������������������� Drug rebates: Align Medicare drug payment policies with Medicaid policies for low-income beneficiaries ��� Medicare structural reforms: Increase income-related premiums under Medicare Parts B and D �� Modify Part B deductible for new enrollees �������������������������������������� Introduce home health co-payments for new beneficiaries ������������������� Introduce a Part B premium surcharge for beneficiaries that purchase near first-dollar medigap coverage ������������������������ 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... –50 –60 –70 –70 –70 –80 –80 –90 –90 –250 –660 ......... –10 –20 –20 –30 –50 –50 –60 –70 –70 –70 –130 –450 ......... ......... ......... ......... ......... ......... ......... ......... –170 –190 –200 ......... –560 ......... –40 –60 –70 –80 –80 –80 –90 –90 –100 –110 –330 –800 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –3,516 –8,588 –9,376 –10,327 –11,759 –13,482 –14,725 –16,501 –18,583 –20,272 –43,566 –127,129 ......... –30 –890 –2,030 –3,360 –4,780 –6,380 –8,330 –10,490 –12,920 –15,590 –11,090 –64,800 ......... –180 –220 –230 –240 –250 –260 –280 –290 –310 –330 –1,120 –2,590 ......... –180 –220 –220 –230 –240 –250 –260 –260 –270 –290 –1,090 –2,420 ......... ......... ......... ......... –230 –280 –300 –330 –350 –380 –420 –510 ......... –4,336 –12,048 –14,996 –18,087 –21,269 –24,872 –28,405 –32,841 –37,763 –42,542 –70,736 –2,290 –237,159 ......... ......... ......... ......... ......... –1,500 –2,330 –2,790 –5,437 –7,433 –9,260 –1,500 –28,750 ......... ......... ......... ......... ......... –50 –50 –230 –320 –700 –820 –50 –2,170 ......... ......... ......... ......... ......... –20 –30 –50 –80 –110 –140 –20 –430 ......... ......... ......... ......... ......... –80 –210 –340 –490 –640 –800 –80 –2,560 MID-SESSION REVIEW Encourage efficient post-acute care: Adjust payment updates for certain post-acute care providers ���������������������������������� Equalize payments for certain conditions commonly treated in Inpatient Rehabilitation Facilities and Skilled Nursing Facilities (SNFs) ���������������������� Encourage appropriate use of inpatient rehabilitation hospitals ���������������������������������� Adjust SNF payments to reduce hospital readmissions ������������� Total, Medicare providers ������������ 2013 46 Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Strengthen the Independent Payment Advisory Board (IPAB) to reduce long-term drivers of Medicare cost growth ������������������ Total, Medicare structural reforms ����������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 ......... ......... ......... ......... ......... ......... ......... ......... ......... 2021 ......... 2022 2013– 2017 2013– 2022 –1,193 ......... –1,193 –8,883 –12,213 –1,650 –35,103 249 12,331 ......... ......... ......... ......... ......... –1,650 –2,620 –3,410 –6,327 Interactions ������������������������������������� ......... 38 53 20 47 91 834 2,185 2,643 2,915 Medicaid and other: Enact Medicaid reforms ������������������ ......... 319 549 –2,156 –3,191 –7,456 –7,351 –7,581 –7,201 –7,741 –8,187 –11,936 –49,997 ......... –714 –792 –858 –938 –1,007 –1,085 –1,182 –1,276 –1,376 –1,495 –4,309 –10,723 ......... ......... ......... –714 ......... –792 –156 –1,014 –354 –1,292 –415 –1,422 –483 –1,568 –622 –1,804 –672 –1,948 –702 –2,078 –742 –2,237 –925 –5,234 –4,146 –14,869 ......... ......... ......... –395 ......... –243 ......... –3,170 ......... –4,483 ......... –8,878 ......... –8,919 ......... –9,385 ......... –9,149 ......... ......... ......... –9,819 –10,424 –17,170 ......... –64,866 ......... 100 250 50 ......... ......... ......... ......... ......... ......... ......... 400 ......... –4,593 –11,988 –18,096 –22,523 –31,706 –35,577 –39,015 –45,674 –53,550 –61,674 –88,907 1 3 5 6 6 6 6 6 6 6 6 26 ......... 409 634 731 748 750 750 750 750 750 750 3,272 400 –324,397 56 7,022 Pharmaceutical savings: Prohibit brand and generic drug companies from delaying the availability of new generic drugs and biologics ����������������� Modify length of exclusivity to facilitate faster development of generic biologics ���������������������� Total, pharmaceutical savings ��� Accelerate the issuance of state innovation waivers ���������������������� Total, Medicaid and other ���������� Provide administrative expenses for implementation ��������������������������� Total, HHS health proposals ����������� Extend the child welfare study �������������� Strengthen and expand child care access ��� Improve permanency and safety and child welfare ���������������������������������������� Modernize child support ������������������������� 3,505 220 7 243 9 248 182 250 224 250 271 250 283 250 336 250 378 250 380 250 236 1,211 693 2,461 2,306 Supplemental Security Income (SSI) effects �������������������������������������������� ......... ......... ......... –1 –2 –2 –3 –3 –4 –4 –4 –5 –23 SNAP effects ������������������������������������ ......... ......... ......... –21 –32 –43 –54 –65 –76 –76 –76 –96 –443 Medicaid effects ������������������������������� ......... ......... ......... 10 10 10 10 10 10 10 10 30 80 Foster care effects ��������������������������� ......... 2 36 36 35 34 34 33 32 31 30 143 303 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 1 –3,952 –11,061 –16,905 –21,284 –30,430 –34,301 –37,698 –44,328 –52,203 –60,472 –83,633 –312,635 Make TANF supplemental grant funding permanent and reduce the annual amount available in the TANF contingency fund ��������������������������������� Total, HHS ���������������������������������������� 47 ......... ......... SUMMARY TABLES Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –200 –1,139 –1,410 –1,675 –1,950 –2,235 –2,279 –2,324 –2,370 –2,417 –6,374 –17,999 Housing and Urban Development: Provide funding for the Affordable Housing Trust Fund ��������������������������� ......... 10 140 290 230 190 100 20 20 ......... ......... 860 1,000 29 ......... 34 ......... 27 –2 24 –4 22 –5 20 –5 14 –6 13 –6 12 –11 11 –17 10 –24 127 –16 187 –80 ......... ......... –200 –150 –100 –50 ......... ......... ......... ......... ......... –500 –500 ......... ......... ......... –4 –44 –4 –46 –5 –47 –5 –47 –5 –49 –5 –50 –5 –52 –5 –56 –6 –58 –6 –184 –23 –449 –50 ......... ......... –18 –18 ......... ......... ......... ......... ......... ......... ......... –36 –36 ......... –13 –29 –42 –55 –67 –82 –99 –115 –132 –149 –206 –783 ......... ......... –3 –4 –5 ......... –8 ......... –9 ......... –3 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –28 –4 –28 –4 29 10 –275 –249 –199 –157 –128 –147 –171 –200 –227 –870 –1,743 ......... 100 50 50 50 ......... ......... ......... ......... ......... ......... 250 250 ......... ......... 4,945 4,685 4,036 3,697 3,557 3,644 3,793 3,967 4,143 17,363 36,467 1,106 3,245 2,713 –6,914 –9,696 –5,687 –7,323 –6,599 –8,623 –5,254 –5,494 –16,339 –49,632 ......... –10 –13 –23 –33 –43 –54 –65 –76 –87 –99 –122 –503 ......... ......... –21 1 –54 1 –74 1 –92 1 –103 1 –21 1 –100 1 –52 1 –257 1 –93 1 –344 5 –867 10 1,106 3,215 7,592 –2,325 –5,784 –2,135 –3,840 –3,119 –4,957 –1,630 –1,542 563 –14,525 ......... –644 –661 –688 –713 –738 –760 –776 –791 –806 –821 –3,444 –7,398 Interior: Extend the Palau Compact of Free Association ������������������������������������������ Reform hardrock mining on public lands ��� Establish an AML hardrock reclamation fund 2 ���������������������������������������������������� Make permanent net receipts sharing for energy minerals ����������������������������� Repeal geothermal payment to counties Repeal oil and gas fee prohibition and mandatory permit funds ��������������������� Impose a fee on nonproducing oil and gas leases ��������������������������������������������� Reauthorize the Federal Land Transaction Facilitation Act of 2000 (FLTFA) ����������������������������������������������� Increase duck stamp fees 2 ���������������������� Total, Interior ����������������������������������� Justice: Provide incentives for State medical malpractice reform ������������������������������ Labor: Establish a universal dislocated workers program 7 �������������������������������������������� Strengthen unemployment insurance system solvency 2 3 8 ����������������������������� Reform the Federal Employees’ Compensation Act (FECA) ����������������� Implement unemployment insurance administration cap adjustment 2 3 ����� Enact foreign labor certification fees ����� Total, Labor ������������������������������������ Transportation: Establish a mandatory surcharge for air traffic services 2 3 ��������������������������������� MID-SESSION REVIEW Homeland Security: Reform the aviation passenger security user fee to more accurately reflect the costs of aviation security �������������������� 48 Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Restructure funding for Essential Air Service Program ���������������������������������� Total, Transportation ����������������������� Treasury: Impose a financial crisis responsibility fee 2 ������������������������������������������������������� Implement IRS program integrity cap adjustment 2 ����������������������������������������� Restructure assistance to New York City, provide tax incentives fortransportation infrastructure 2 ������ Authorize the Bureau of Engraving and Printing (BEP) to conduct a couponprogram to distribute electronic currency readers 2 ������������� Increase levy authority for payments to Medicare providers with delinquenttax debt 2 ���������������������������� Authorize Treasury to locate and recover assets of the United States and to retain a portion of amounts collected to pay for the costs of recovery ���������� Provide authority to contact delinquent debtors via their cell phones �������������� Allow offset of Federal income tax refunds to collect delinquent State income taxes for out-of-state residents ����������������������� Total, Treasury ������������������������������� 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... 30 50 50 50 50 50 50 50 50 50 230 480 ......... –614 –611 –638 –663 –688 –710 –726 –741 –756 –771 –3,214 –6,918 ......... ......... –3,224 –6,404 –6,441 –6,708 –6,975 –7,237 –7,576 –7,910 –8,266 –22,777 –60,741 ......... –421 –1,123 –2,251 –3,455 –4,694 –5,585 –6,200 –6,483 –6,661 –6,779 –11,944 –43,652 ......... 200 200 200 200 200 200 200 200 200 200 1,000 2,000 ......... –53 –12 –12 –12 –13 –13 –13 –14 –14 –14 –102 –170 ......... –50 –66 –68 –70 –72 –74 –76 –77 –78 –80 –326 –711 ......... ......... –2 –2 –2 –2 –2 –2 –2 –2 –2 –8 –18 ......... –12 –12 –12 –12 –12 –12 –12 –12 –12 –12 –60 –120 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –336 –4,239 –8,549 –9,792 –11,301 –12,461 –13,340 –13,964 –14,477 –14,953 –34,217 –103,412 ......... ......... –29 –68 –104 –155 –201 –241 –294 –329 –374 –356 –1,795 ......... ......... –4 –4 –4 –4 –4 ......... ......... ......... ......... –16 –20 ......... 1 1 1 1 1 1 1 1 1 1 5 10 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 1 1 1 1 1 1 1 1 1 1 5 10 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 1 ......... 1 ......... 1 ......... 1 ......... ......... ......... 4 49 Veterans Affairs: Extend rounding down of cost of living adjustments (compensation) �������������� Extend rounding down of cost of living adjustments (education) ��������������������� Allow occupancy by a dependent child to satisfy VA home loans occupancy requirement ����������������������������������������� Allow for government furnished headstones 9 ����������������������������������������� Expand work study activities 10 �������������� Increase cap on vocational rehabilitation contract counseling ����������������������������� Exclude temporary residence adaptation grants from Specially Adapted Housing (SAH) grants 11 ��������������������� Replace the SAH program’s grant limit 12 ��� 2013 SUMMARY TABLES Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Amend visual impairment standard for SAH grant ������������������������������������������� Restore eligibility for housing adaptation ��� Provide SAH grants to veterans living with family ������������������������������������������ Extend supplemental service disabled veterans insurance coverage 13 ����������� Expand eligibility for veterans medallion for headstones 14 ���������������������������������� Total, Veterans Affairs ��������������������� Corps of Engineers: Reform inland waterways funding 2, 3 ����� Other Defense—Civil Programs: Increase TRICARE pharmacy benefit copayments ������������������������������������������ Increase TRICARE pharmacy benefit copayments (accrual effect) ���������������� Increase annual premiums for TRICARE-For-Life (TFL) enrollment Increase annual premiums for TFL (accrual effect) ������������������������������������� Provide additional accrual payments to the Medicare-Eligible Retiree Health Care Fund �������������������������������������������� Total, Other Defense—Civil Programs �������������������������������������� Environmental Protection Agency: Enact Pesticide Registration and Premanufacture Notice Fees �������������� Establish Hazardous Waste Electronic Manifest System ��������������������������������� Office of Personnel Management: Increase employee contributions to the Civil Service Retirement System (CSRS) and the Federal Employees Retirement System (FERS) 2 �������������� Eliminate the FERS Supplement for new employees (accrual effects) ���������� Streamline Federal Employees Health Benefits Program pharmacy benefit contracting (health proposal) ������������� 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... 3 6 3 6 3 6 1 6 1 7 1 7 1 7 1 8 1 8 1 9 11 31 16 70 ......... 6 6 6 7 7 7 8 8 9 9 32 73 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 17 –16 –55 –92 –142 –188 –222 –274 –308 –352 –288 –1,632 ......... –82 –113 –113 –113 –113 –113 –113 –113 –113 –114 –534 –1,100 ......... –256 –335 –542 –678 –936 –1,131 –1,335 –1,575 –1,865 –1,993 –2,747 –10,646 ......... 979 1,012 1,069 1,130 1,195 1,264 1,336 1,413 1,495 1,581 5,385 12,474 ......... –141 –287 –436 –586 –627 –672 –716 –764 –816 –872 –2,077 –5,917 ......... 404 416 439 463 490 518 548 579 613 648 2,212 5,118 ......... –271 ......... ......... ......... ......... ......... ......... ......... ......... ......... –271 –271 ......... 715 806 530 329 122 –21 –167 –347 –573 –636 2,502 758 ......... –77 –88 –95 –97 –101 –104 –107 –110 –114 –116 –458 –1,009 ......... ......... ......... –6 –4 –3 –3 –3 –3 –3 –3 –13 –28 ......... –77 –88 –101 –101 –104 –107 –110 –113 –117 –119 –471 –1,037 ......... –865 –1,656 –2,397 –2,347 –2,300 –2,252 –2,194 –2,132 –2,068 –1,995 –9,565 –20,206 ......... 2 8 12 18 21 26 30 33 35 38 61 223 ......... ......... –101 –196 –211 –227 –244 –264 –284 –307 –333 –735 –2,167 MID-SESSION REVIEW Total, Environmental Protection Agency ���������������������������������������� 2013 50 Totals 2012 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Total, Office of Personnel Management �������������������������������� Social Security Administration (SSA): Improve collection of pension information from States and localities ��������������������� Enact Disability Insurance Work Incentives Simplification Pilot ����������� Establish Workers Compensation Information Reporting ������������������������ Enact SSA quarterly wage reporting ����� Extend SSI time limits for qualified refugees ����������������������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 –2,290 –10,239 2013– 2017 2013– 2022 ......... –863 –1,749 –2,581 –2,540 –2,506 –2,470 –2,428 –2,383 –2,340 –22,150 ......... 13 20 17 –211 –456 –593 –626 –566 –529 –481 –617 –3,412 ......... 5 10 15 22 25 13 ......... ......... ......... ......... 77 90 ......... ......... 5 20 5 30 ......... 90 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 10 140 10 140 84 84 ......... 41 43 ......... ......... ......... ......... ......... ......... ......... ......... Medicaid effects ������������������������������� ......... 11 11 ......... ......... ......... ......... ......... ......... ......... ......... 22 22 SNAP effects ������������������������������������ ......... –7 –7 ......... ......... ......... ......... ......... ......... ......... ......... –14 –14 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 88 112 122 –189 –431 –580 –626 –566 –529 –481 –298 –3,080 ......... –140 –260 –380 –990 –130 –100 –120 –120 –120 –120 –1,900 –2,480 Enact Postal Service financial relief and reform: PAYGO impact ��������������������������������� 1,551 Non-scorable impact ������������������������ –1,696 3,114 –656 –3,033 3,777 –4,055 5,863 –4,072 7,690 –4,088 5,692 –4,088 7,302 –4,088 3,933 –4,088 3,933 –4,088 3,933 –4,088 –12,134 3,933 22,366 –32,574 45,400 Lower electronic wage reporting threshold to 100 employees 15 ������������� Conform treatment of state and local government EITC and CTC for SSI 14 ���� Terminate stepchild benefits in the same month as step-parent 16 ����������������������� Total, SSA ����������������������������������������� SUMMARY TABLES Totals 2012 Other Independent Agencies: Civilian Property Realignment Board: Dispose of unneeded real property Postal Service: Railroad Retirement Board (RRB): ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... Total, other independent agencies ���� –145 2,318 484 1,428 2,628 1,474 3,114 –275 –275 –275 –275 8,332 10,346 –50 ......... –225 ......... –325 ......... –425 ......... –550 ......... –550 ......... –550 ......... –550 ......... –550 ......... –550 –550 ......... –45,200 –2,075 ......... –4,825 –45,200 Multi-Agency: Enact Spectrum License User Fee and allow the FCC to auction predominantly domestic satellite services�������������������������������������������������� Adjust payment timing ���������������������������� 51 Allow the electronic certification of certain RRB benefits ������������������� Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Establish hold harmless for Federal poverty guidelines ������������������������������� Total, multi-agency �������������������������� Total, health and other mandatory proposals ������������������������������������������������ Total, mandatory initiatives and savings ��� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... –50 –225 –325 –425 –550 –550 –550 –550 –550 –550 –45,750 –2,075 –50,025 52 Totals 2012 941 –4,046 –14,935 –30,849 –38,263 –51,550 –58,529 –66,815 –76,271 –81,471–135,229 –139,644 –557,959 941 –3,779 –11,172 –22,203 –24,826 –33,058 –34,466 –44,337 –61,172 –70,826 –127,191 –95,039 –433,031 Total, mandatory and receipt proposals, including measures for jobs growth �������� 13,451 83,278 –87,846 –136,520 –165,439 –190,836 –201,500 –222,152 –249,805 –269,725 –335,904 –497,364 –1,776,450 Note: For receipt effects, positive figures indicate lower receipts. For outlay effects, positive figures indicate higher outlays. For net costs, positive figures indicate higher deficits. 1 The estimates for this proposal include effects on outlays. The outlay effects included in the totals above are as follows: 2012 2 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... ......... ......... 615 567 ......... ......... 1,519 5,402 ......... 2,739 5,970 ......... 4,070 6,415 ......... 5,499 6,451 ......... 7,012 6,887 ......... 8,588 7,006 ......... 10,216 7,467 ......... 11,904 7,618 ......... 13,859 8,158 615 14,394 24,238 615 65,973 61,374 ......... ......... ......... ......... ......... 70 ......... 1,576 134 1,405 304 977 205 1,441 319 309 212 1,469 331 113 218 1,496 340 72 220 1,518 351 ......... 223 1,549 361 ......... 231 1,581 368 ......... 235 1,614 376 ......... 238 1,644 383 ......... 769 5,881 1,294 3,047 1,916 13,787 3,133 3,047 ......... ......... 15 ......... 85 23 123 24 118 27 103 27 88 29 77 ......... 71 ......... 50 ......... 34 ......... 444 101 764 130 ......... 534 596 ......... ......... ......... ......... ......... ......... ......... ......... 1,130 1,130 ......... –3 –7 –7 –7 –7 –8 –8 –8 –9 –9 –31 –73 ......... ......... 21 3,395 427 10,865 437 11,560 445 13,193 452 14,651 459 16,556 468 18,264 477 20,403 486 22,274 495 24,802 1,782 53,664 4,167 155,963 The estimates for this proposal include effects on governmental receipts. The receipt effects included in the totals above are as follows: 2012 Reauthorize special assessment from domestic nuclear utilities ���������������������������� Establish an AML hardrock reclamation fund���� Increase duck stamp fees ��������������������������������� ......... ......... ......... 2013 –200 ......... –14 2014 –204 –200 –14 2015 –208 –200 –14 2016 –212 –200 –14 2017 –217 –200 –14 2018 –221 –200 –14 2019 –226 –200 –14 2020 –231 –200 –14 2021 –235 –200 –14 2022 –240 –200 –14 2013– 2017 –1,041 –800 –70 2013– 2022 –2,194 –1,800 –140 MID-SESSION REVIEW Provide a temporary 10-percent tax credit for new jobs and wage increases ���������������������� Reform and extend Build America Bonds ������� Extend AOTC ��������������������������������������������������� Provide for automatic enrollment in IRAs, including an employer tax credit, and doubling of the tax credit for small employer plan start-up costs ����������������������� Expand EITC for larger families ��������������������� Expand child and dependent care tax credit �� Extend and modify certain energy incentives Expand and simplify the tax credit provided to qualified small employers for nonelective contributions to employee health insurance ������������������������������������������������������ Designate Growth Zones ��������������������������������� Continue certain expiring provisions through calendar year 2013 ��������������������������������������� Extend IRS math error authority in certain circumstances ����������������������������������������������� Simplify the rules for claiming the EITC for workers without qualifying children ����������� Total, outlay effects of receipt proposals ���� 2013 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Strengthen unemployment insurance system solvency �������������������������������������������������������� Implement unemployment insurance administration cap adjustment ������������������� Establish a mandatory surcharge for air traffic services ���������������������������������������������� Impose a financial crisis responsibility fee ����� Implement IRS program integrity cap adjustment �������������������������������������������������� Restructure assistance to New York City, provide tax incentives for transportation infrastructure ����������������������������������������������� Authorize the BEP to conduct a coupon program to distribute electronic currency readers ���������������������������������������������������������� Increase levy authority for payments to Medicare providers with delinquent tax debt ��������������������������������������������������������������� Reform inland waterways funding ����������������� Increase employee contributions to CSRS and FERS ������������������������������������������������������������� Total receipt effects of mandatory proposals �������������������������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 –5,494 –17,121 ......... 2,461 2,714 –6,913 –9,696 –5,687 –7,324 –6,599 –8,622 –5,255 ......... ......... ......... 3 8 16 114 41 95 –104 ......... ......... –644 ......... –661 –3,224 –688 –6,404 –713 –6,441 –738 –6,708 –760 –6,975 –776 –7,237 –791 –7,576 ......... –421 –1,123 –2,251 –3,455 –4,694 –5,585 –6,200 ......... 200 200 200 200 200 200 ......... –53 –12 –12 –12 –13 ......... ......... –50 –82 –66 –113 –68 –113 –70 –113 ......... –865 –1,656 –2,397 –2,347 ......... 332 67 2013– 2017 2013– 2022 –50,415 27 240 –806 –7,910 –821 –3,444 –8,266 –22,777 –7,398 –60,741 –6,483 –6,661 –6,779 –11,944 –43,652 200 200 200 200 1,000 2,000 –13 –13 –14 –14 –14 –102 –170 –72 –113 –74 –113 –76 –113 –77 –113 –78 –113 –80 –114 –326 –534 –711 –1,100 –2,300 –2,252 –2,194 –2,132 –2,068 –1,995 –9,565 –20,206 –4,359 –19,065 –23,065 –20,540 –23,217 –23,407 –25,958 –23,258 –23,750 –66,697 –186,287 SUMMARY TABLES Totals 2012 Net of income offsets. 4 The Administration also proposes to restore the estate, gift and GST tax parameters in effect in 2009. The total effect on receipts of allowing the Bush tax cuts to expire for high-income taxpayers is as follows: 3 2012 Sunset the Bush tax cuts for those with income in excess of $250,000 ($200,000 if single) ��������������������������������������������������� Restore the estate, gift and GST tax parameters in effect in 2009 ������������������� Total, effect on receipts of allowing the Bush tax cuts to expire for highincome taxpayers �������������������������������� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –53,482 –49,883 –61,441 –74,664 –84,222 –90,239 –96,053–102,024–108,455–115,162 –323,692 –835,625 ......... –9,732 –10,621 –11,623 –12,706 –13,886 –15,104 –16,456 –17,700 –40,708 –116,560 ......... –53,735 –58,362 –71,173 –85,285 –95,845–102,945–109,939–117,128–124,911–132,862 –364,400 –952,185 –253 –8,479 The proposal is estimated to have zero receipt effect under the Administration’s current economic projections. 6 The Administration also proposes to repeal the domestic manufacturing deduction for oil and gas and other fossil fuel production. The effects of repeal on receipts, which are included in the estimates of the Administration’s proposal to target the domestic production activities deduction, are as follows: 5 2012 ......... –569 2014 –978 2015 2016 2017 2018 2019 2020 2021 2022 –1,033 –1,094 –1,157 –1,220 –1,279 –1,337 –1,397 –1,459 2013– 2017 –4,831 2013– 2022 –11,523 53 Repeal domestic manufacturing tax deduction for oil and gas production ������ 2013 Table S–10. MANDATORY AND RECEIPT PROPOSALS—Continued (Deficit increases (+) or decreases (–) in millions of dollars) Repeal domestic manufacturing tax deduction for coal and other hard mineral fossil fuels ��������������������������������� Total, effect on receipts of repealing the domestic manufacturing tax deduction for oil and gas and other fossil fuels ��� 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2013– 2017 2013– 2022 ......... –12 –21 –23 –24 –25 –26 –28 –29 –30 –32 –105 –250 ......... –581 –999 –1,056 –1,118 –1,182 –1,246 –1,307 –1,366 –1,427 –1,491 –4,936 –11,773 54 Totals 2012 This proposal would also result in discretionary savings of $7.7 billion over 10 years. 8 Totals include the effects of interest on unemployment insurance loans to States. 9 This proposal has outlays of less than $500,000 per year. The total cost over 2013–2022 is $1 million. 10 This proposal has outlays of less than $500,000 per year. The total cost is $1 million from 2013–2017 and $2 million from 2013–2022. 11 This proposal has outlays of less than $500,000 per year. The total cost is $1 million from 2013–2017 and $3 million from 2013–2022. 12 This proposal has outlays less than $500,000 per year in years 2013–2018. The total cost is $2 million from 2013–2017. 13 This proposal has outlays of less than $500,000 per year. The total cost is $1 million over 2013–2017 and $3 milion over 2013–2022. 14 This proposal has outlays of less than $500,000 per year. The total cost over 2013–2022 is also less than $500,000. 15 This proposal has no estimated costs. 16 This proposal has outlays of less than $500,000 per year. The total savings are $1 million over 2013–2017 and $4 million over 2013–2022. 7 MID-SESSION REVIEW Table S–11. OUTLAYS FOR MANDATORY PROGRAMS UNDER CURRENT LAW 1,2 (In billions of dollars) Estimate 2012 2013 2014 2015 2016 2017 Human resources programs: Education, training, employment and social services ����������������������������������������������������� Health �������������������������������������������������������������������������������������������������������������������������������� Medicare ���������������������������������������������������������������������������������������������������������������������������� Income security ����������������������������������������������������������������������������������������������������������������� Social Security ������������������������������������������������������������������������������������������������������������������� Veterans’ benefits and services ���������������������������������������������������������������������������������������� Subtotal, human resources programs ������������������������������������������������������������������������� –15 310 480 526 725 70 2,096 –2 300 469 492 769 69 2,096 1 320 500 468 813 80 2,182 –1 412 526 427 859 84 2,306 –4 474 547 431 909 89 2,445 –1 522 591 445 961 101 2,619 4 553 611 443 1,016 101 2,729 Other mandatory programs: National defense ��������������������������������������������������������������������������������������������������������������� International affairs ��������������������������������������������������������������������������������������������������������� Energy ������������������������������������������������������������������������������������������������������������������������������� Agriculture ������������������������������������������������������������������������������������������������������������������������ Commerce and housing credit ������������������������������������������������������������������������������������������ Transportation ������������������������������������������������������������������������������������������������������������������ Community and regional development ���������������������������������������������������������������������������� Justice �������������������������������������������������������������������������������������������������������������������������������� General government ��������������������������������������������������������������������������������������������������������� Undistributed offsetting receipts ������������������������������������������������������������������������������������� Other functions ����������������������������������������������������������������������������������������������������������������� Subtotal, other mandatory programs �������������������������������������������������������������������������� Total, outlays for mandatory programs under current law ������������������������������������ 6 –3 –2 14 –11 2 –* 2 6 –86 2 –70 2,026 7 –1 2 14 60 –* * 3 12 –95 6 8 2,105 9 –* 1 20 –20 2 1 11 7 –93 4 –58 2,125 8 –* 1 16 –30 3 * 6 7 –93 4 –81 2,225 8 –1 –1 15 –36 3 –* 3 6 –95 3 –94 2,351 8 –1 –1 15 –35 3 –1 4 6 –95 4 –94 2,525 8 –1 –1 15 –29 3 –1 3 6 –100 4 –94 2,635 SUMMARY TABLES 2011 Actual *$500 million or less 1 This table meets the requirements of Section 221(b) of the Legislative Reorganization Act of 1970. 2 Estimates are based on the Budget Enforcement Act (BEA) baseline. The BEA baseline differs in some instances from current law (see the chapter on “Current Services Estimates” in the Analytical Perspectives volume of the 2013 Budget) and also from the adjusted baseline (see Table S–8). 55 Table S–12. FUNDING LEVELS FOR APPROPRIATED (“DISCRETIONARY”) PROGRAMS BY CATEGORY 2010 2011 2012 2013 Actual Actual Enacted Request 2014 Discretionary Policy by Category:1 Security Agencies ���������������������������� Nonsecurity Agencies ���������������������� 684.4 400.4 687.8 371.0 683.5 372.0 686.0 355.9 698.4 363.3 56 (Budget authority in billions of dollars) Outyears 2015 711.6 370.1 2016 725.3 377.3 2017 741.0 385.5 2018 757.4 394.0 Totals 2019 774.5 402.9 2020 791.5 411.8 2021 808.5 420.6 2022 2013– 2017 2013– 2022 829.5 3,562.3 7,523.7 430.9 1,852.2 3,912.4 Total, Base Discretionary Funding ���� 1,084.8 1,058.8 1,055.5 1,041.9 1,061.8 1,081.7 1,102.6 1,126.5 1,151.4 1,177.3 1,203.3 1,229.2 1,260.4 5,414.5 11,436.1 Discretionary Cap Adjustments and Other Funding (not included above):2 Overseas Contingency Operations3 162.6 159.4 126.5 96.7 44.2 Disaster Relief ��������������������������������� ......... ......... 10.5 5.6 ......... Program Integrity4 �������������������������� 0.5 0.5 0.8 1.8 2.3 Other Emergency/Supplemental Funding5 �������������������������������������� 9.6 –1.3 –* ......... ......... 44.2 ......... 2.8 44.2 ......... 3.2 44.2 ......... 3.7 44.2 ......... 3.7 44.2 ......... 3.8 44.2 ......... 3.9 44.2 ......... 4.0 44.2 ......... 4.1 273.4 5.6 13.9 494.2 5.6 33.4 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... Grand Total, Discretionary Budget Authority �������������������������������������������� 1,257.6 1,217.5 1,193.3 1,146.1 1,108.2 1,128.7 1,150.0 1,174.4 1,199.3 1,225.3 1,251.3 1,277.3 1,308.6 5,707.4 11,969.3 Memorandum, Grand Total Discretionary Budget Authority Adjusted for Inflation and Population: Security ������������������������������������������������� 943.7 903.5 840.9 788.2 721.4 712.6 704.4 696.9 689.5 682.5 675.4 668.0 Nonsecurity ������������������������������������������ 441.6 395.0 388.1 357.9 355.2 351.7 348.3 345.5 342.2 339.1 335.9 332.7 Grand Total ������������������������������������������ 1,385.3 1,298.4 1,229.0 1,146.1 1,076.6 1,064.4 1,052.7 1,042.4 1,031.7 1,021.6 1,011.3 1,000.7 663.5 3,623.5 7,002.4 330.3 1,758.5 3,438.7 993.8 5,382.1 10,441.1 MID-SESSION REVIEW * $50 million or less. 1 The 2013 Budget proposes discretionary funding levels within the caps included in Title I of the Budget Control Act of 2011 with separate categories for “security” and “nonsecurity” programs for 2013 and a single discretionary category for 2014–2021. These caps have been adjusted downward to reflect the Administration’s proposal to reclassify certain Surface Transportation programs as mandatory, as shown in the Preview Report in the Budget Process chapter of the Analytical Perspectives volume. For purposes of this presentation, the security and nonsecurity categories are increased from 2013 based on growth in the overall discretionary category but do not reflect specific policy decisions. For 2022, programs are assumed to grow at current services. 2 Where applicable, amounts in 2012 through 2021 are cap adjustment amounts designated pursuant to Section 251(b)(2) of the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA), as amended. Amounts in 2010 and 2011 are not so designated but are shown for comparability purposes. 3 The Budget includes placeholder estimates of $44.2 billion per year for Overseas Contingency Operations (OCO) in 2014 and beyond. These estimates reflect the Administration’s proposal to cap total OCO budget authority from 2013 to 2021 at $450 billion but do not reflect any specific decisions or assumptions about OCO spending in any particular year. 4 Amounts in 2012 include requested increased funding for BBEDCA program integrity adjustments. The Budget request for $140 million to fully fund SSA’s program integrity cap adjustment for 2012 has been removed since the agency no longer has sufficient time to complete the additional program integrity work by the end of the fiscal year. 5 Amounts are not designated as Emergency funding pursuant to Section 251(b)(2)(A) of the BBEDCA, as amended. These amounts include congressionally-designated emergencies, rescissions of funding provided in the American Recovery and Reinvestment Act of 2009 (P.L. 111–5), and other supplemental funding. (Budget authority in billions of dollars) 2010 2011 2012 2013 Actual Actual Enacted Request 2014 Outyears 2015 2016 2017 2018 Totals 2019 2020 2021 2022 2013– 2017 2013– 2022 Base Discretionary Funding by Agency:1 Security Agencies: Defense2 ������������������������������������������� Energy - National Nuclear Security Administration2 ��������������������������� Homeland Security ������������������������� Veterans Affairs3 ������������������������������ State and Other International Programs4,5 ���������������������������������� Intelligence Community Management Account ����������������� Allowance for Security6 ������������������� Subtotal, Security Agencies7 ���������� 528.3 530.5 525.4 533.6 545.9 555.9 567.3 579.3 592.4 605.4 617.9 634.2 2,728.2 5,757.4 9.9 39.8 53.1 10.5 41.9 56.4 11.0 39.7 58.5 11.5 39.5 61.0 10.8 39.8 63.1 11.0 40.5 64.2 11.2 41.2 65.5 11.4 41.9 66.9 11.7 42.8 68.3 11.9 43.7 69.8 12.2 44.7 71.3 12.4 45.7 72.8 12.8 46.8 74.8 55.9 202.8 320.6 116.8 426.5 677.7 50.8 50.1 43.3 48.0 48.9 49.8 50.8 51.9 53.0 54.2 55.3 56.5 58.0 249.3 526.3 0.7 ......... 684.4 0.7 ......... 687.8 0.5 ......... 683.5 0.5 ......... 686.0 0.6 1.8 698.4 0.6 –0.4 711.6 0.6 0.3 725.3 0.6 1.0 741.0 0.6 1.8 757.4 0.6 1.8 774.5 0.6 1.9 791.5 0.7 2.5 808.5 25.1 13.9 7.2 64.3 21.5 5.6 –0.7 68.3 22.0 7.7 0.9 67.4 21.4 8.0 1.0 69.8 22.6 8.3 1.2 70.3 23.1 8.6 1.3 71.2 23.5 8.9 1.5 72.2 24.0 9.4 1.8 73.3 24.6 10.4 2.6 74.4 25.1 11.5 3.6 75.5 25.7 17.7 9.6 76.7 26.2 9.8 1.6 77.9 26.9 9.7 1.2 79.2 114.6 43.3 5.9 356.9 243.0 102.3 25.0 740.6 16.6 84.4 42.8 12.1 27.6 13.5 15.2 78.5 37.1 11.7 26.9 12.5 15.3 78.3 36.6 11.3 26.8 13.2 15.6 71.7 34.5 11.4 17.9 12.0 16.3 79.8 39.2 11.9 27.7 12.0 16.6 81.3 40.0 12.1 28.3 11.3 16.9 82.9 40.8 12.4 28.8 11.5 17.3 84.7 41.7 12.6 29.5 11.8 17.6 86.5 42.6 12.9 30.1 12.0 18.0 88.5 43.6 13.2 30.8 12.3 18.4 90.4 44.6 13.5 31.5 12.5 18.8 92.4 45.5 13.7 32.2 12.8 19.3 94.6 46.7 14.1 33.0 13.0 82.6 400.3 196.1 60.3 132.2 58.6 174.8 852.6 419.1 127.7 289.8 121.2 0.1 14.7 13.4 5.5 10.3 0.4 0.1 13.7 13.4 4.9 8.7 –1.0 0.1 13.7 13.2 5.0 8.5 –1.0 0.1 13.8 12.5 4.7 8.3 –0.8 0.1 14.1 13.7 4.8 8.5 –1.2 0.1 14.4 14.1 4.9 8.7 –1.3 0.1 14.7 14.5 5.0 8.9 –1.3 0.1 15.0 14.9 5.1 9.1 –1.4 0.1 15.3 15.4 5.2 9.3 –1.4 0.1 15.7 15.9 5.3 9.5 –1.4 0.1 16.0 16.4 5.5 9.7 –1.4 0.1 16.4 16.9 5.6 9.9 –1.5 0.1 16.8 17.3 5.7 10.1 –1.5 0.6 72.0 69.8 24.6 43.5 –5.9 1.3 152.2 151.6 51.9 91.9 –13.2 18.7 6.9 0.8 8.9 18.4 6.8 0.7 8.6 17.8 7.0 0.9 8.8 17.7 7.4 0.9 9.0 18.0 7.5 1.0 9.2 18.4 7.6 1.0 9.4 18.7 7.8 1.0 9.5 19.1 8.0 1.0 9.7 19.6 8.1 1.0 9.9 20.0 8.3 1.1 10.1 20.4 8.5 1.1 10.4 20.9 8.7 1.1 10.6 21.4 8.9 1.1 10.8 92.0 38.3 4.9 46.8 194.2 80.8 10.4 98.6 0.7 2.9 6.1 2.2 2.6 12.8 829.5 3,562.3 7,523.7 57 Nonsecurity Agencies: Agriculture4 ������������������������������������� Commerce ���������������������������������������� Census Bureau ����������������������������� Education ���������������������������������������� Energy (excluding National Nuclear Security Administration) ������������� Health and Human Services8 ��������� Housing and Urban Development ��� Interior �������������������������������������������� Justice ���������������������������������������������� Labor ������������������������������������������������ State and Other International Programs4 ������������������������������������ Transportation �������������������������������� Treasury ������������������������������������������ Corps of Engineers �������������������������� Environmental Protection Agency ��� General Services Administration ��� National Aeronautics and Space Administration ���������������������������� National Science Foundation ��������� Small Business Administration ����� Social Security Administration8 ����� 530.1 SUMMARY TABLES Table S–13. FUNDING LEVELS FOR APPROPRIATED (“DISCRETIONARY”) PROGRAMS BY AGENCY Table S–13. FUNDING LEVELS FOR APPROPRIATED (“DISCRETIONARY”) PROGRAMS BY AGENCY—Continued 2010 2011 2012 2013 Actual Actual Enacted Request 2014 Corporation for National and Community Service ��������������������� Other Agencies �������������������������������� Allowance for Nonsecurity6 ������������� Subtotal, Nonsecurity Discretionary Budget Authority7 ��������������������������� 58 (Budget authority in billions of dollars) Outyears 2015 2016 2017 2018 Totals 2019 2020 2021 2022 2013– 2017 1.1 18.1 ......... 1.0 18.2 ......... 1.1 18.9 ......... 1.1 19.3 –21.1 1.1 19.6 –20.4 1.1 20.0 –20.6 1.1 20.4 –20.8 1.2 20.8 –21.7 1.2 21.3 –22.7 1.2 21.8 –28.8 1.3 22.2 –20.8 1.3 22.7 –20.3 11.6 207.0 –197.2 400.4 371.0 372.0 355.9 363.3 370.1 377.3 385.5 394.0 402.9 411.8 420.6 430.9 1,852.2 3,912.4 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 44.2 ......... ......... ......... 273.4 88.5 ......... ......... 494.2 88.5 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... 8.2 8.2 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 2.8 0.4 * 1.3 1.1 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 3.2 0.4 * 1.6 1.2 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 3.7 0.4 * 2.0 1.3 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 3.7 0.4 * 2.0 1.3 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 3.8 0.5 * 2.0 1.3 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 3.9 0.5 * 2.1 1.3 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 4.0 0.5 * 2.1 1.3 44.2 ......... ......... ......... ......... ......... ......... ......... ......... 4.1 0.5 * 2.2 1.3 176.6 5.6 ......... ......... 5.5 ......... ......... ......... 0.2 13.9 1.8 0.1 6.7 5.3 397.4 5.6 ......... ......... 5.5 ......... ......... ......... 0.2 33.4 4.2 0.3 17.1 11.8 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... MID-SESSION REVIEW 1.2 19.1 ......... Discretionary Cap Adjustments and Other Funding (not included above):9 Overseas Contingency Operations10 ������������������������������������ 162.6 159.4 126.5 96.7 44.2 Defense �������������������������������������������� 162.3 158.8 115.1 88.5 ......... Homeland Security ������������������������� 0.2 0.3 0.3 ......... ......... Justice ���������������������������������������������� 0.1 0.1 ......... ......... ......... State and Other International Programs ������������������������������������� ......... 0.3 11.2 8.2 ......... Overseas Contingency Operations Outyears �������������������������������������� ......... ......... ......... ......... 44.2 Disaster Relief ����������������������������������� ......... ......... 10.5 5.6 ......... Agriculture �������������������������������������� ......... ......... 0.4 ......... ......... Commerce ���������������������������������������� ......... ......... 0.2 ......... ......... Homeland Security ������������������������� ......... ......... 6.4 5.5 ......... Housing and Urban Development ��� ......... ......... 0.1 ......... ......... Transportation �������������������������������� ......... ......... 1.7 ......... ......... Corps of Engineers �������������������������� ......... ......... 1.7 ......... ......... Small Business Administration ����� ......... ......... ......... 0.2 ......... Program Integrity11 �������������������������� 0.5 0.5 0.8 1.8 2.3 Health and Human Services ���������� ......... ......... 0.3 0.3 0.3 Labor ������������������������������������������������ ......... ......... ......... * * Treasury ������������������������������������������ ......... ......... ......... 0.7 1.0 Social Security Administration ������ 0.5 0.5 0.5 0.8 0.9 Other Emergency/Supplemental 12 Funding ���������������������������������������� 9.6 –1.3 –* ......... ......... Defense �������������������������������������������� –1.9 ......... ......... ......... ......... Energy ��������������������������������������������� –1.5 ......... ......... ......... ......... Health and Human Services ���������� 0.2 –1.3 ......... ......... ......... Homeland Security ������������������������� 5.5 ......... –* ......... ......... State and Other International Programs ������������������������������������� 6.1 ......... ......... ......... ......... Small Business Administration ����� 1.0 ......... ......... ......... ......... 5.5 98.1 –82.9 2013– 2022 Table S–13. FUNDING LEVELS FOR APPROPRIATED (“DISCRETIONARY”) PROGRAMS BY AGENCY—Continued 2010 2011 2012 2013 Actual Actual Enacted Request 2014 Other Emergency/Supplemental Funding ��������������������������������������� 0.4 ......... ......... ......... ......... Outyears 2015 ......... 2016 ......... 2017 ......... 2018 ......... Totals 2019 ......... 2020 ......... 2021 ......... 2022 ......... 2013– 2017 ......... 2013– 2022 ......... Grand Total, Discretionary Budget Authority �������������������������������������������� 1,257.6 1,217.5 1,193.3 1,146.1 1,108.2 1,128.7 1,150.0 1,174.4 1,199.3 1,225.3 1,251.3 1,277.3 1,308.6 5,707.4 11,969.3 Memorandum: 2013 Defense Request 2012– 2012– versus 2012 Defense Request13 ������������ 2016 2021 2012 Budget for Defense ����������������� n/a n/a 553.0 570.7 586.4 598.2 610.6 621.6 632.8 644.1 655.7 667.5 n/a 3,540.4 6,140.6 Savings resulting from 2013 MSR policy �������������������������������������������� n/a n/a –22.5 –45.3 –52.8 –52.2 –54.7 –54.2 –53.5 –51.8 –50.3 –49.6 n/a –227.5 –486.9 59 * $50 million or less. 1 The 2013 Budget proposes discretionary funding levels within the caps included in Title I of the Budget Control Act of 2011 with separate categories for “security” and “nonsecurity” programs for 2013 and a single discretionary category for 2014–2021. These caps have been adjusted downward to reflect the Administration’s proposal to reclassify certain Surface Transportation programs as mandatory, as shown in the Preview Report in the Budget Process chapter of the Analytical Perspectives volume. 2 The Department of Defense (DOD) levels in 2014–2022 include funding that will be allocated, in annual increments, to the National Nuclear Security Administration (NNSA). Current estimates by which DOD’s budget authority will decrease and NNSA’s will increase are, in millions of dollars: 2014: 677; 2015: 712; 2016: 767; 2017: 781; 2018: 798; 2013–2022: 7,109. The DOD and NNSA are reviewing NNSA’s outyear requirements and these will be included in future reports to the Congress. 3 The Veterans Affairs total is net of medical care collections. 4 The Security category for State and Other International Programs is comprised entirely of International Function 150. This includes funding for International Food Aid programs in the Department of Agriculture. 5 The variances in the Security category for State and other international programs base funding are due in part to definitional differences in Overseas Contingency Operations (OCO). 6 The 2013 Budget includes allowances, similar to the Function 920 allowances used in Budget Resolutions, to represent amounts to be allocated among the respective agencies to reach the notional security and nonsecurity levels for 2014 and beyond. These notional levels are determined for illustrative purposes based on the overall growth of the discretionary category being applied on a proportional basis to the 2013 security/nonsecurity caps but do not reflect specific policy decisions. 7 Amounts in 2010–2012 exclude changes in mandatory programs enacted in appropriations bills since those amounts have been rebased as mandatory, whereas amounts in 2013 are net of these proposals. The individual agency chapters in this volume provide a comparative look at the gross funding levels from year to year. 8 Funding from the Hospital Insurance and Supplementary Medical Insurance trust funds for administrative expenses incurred by the Social Security Administration that support the Medicare program are included in the Health and Human Service total and not in the Social Security Administration total. 9 Where applicable, amounts in 2012 through 2021 are cap adjustment amounts designated pursuant to Section 251(b)(2) of the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA), as amended. Amounts in 2010 and 2011 are not so designated but are shown for comparability purposes. 10 The Budget includes placeholder estimates of $44.2 billion per year for OCO in 2014 and beyond. These estimates reflect the Administration’s proposal to cap total OCO budget authority from FY 2013 to FY 2021 at $450 billion but do not reflect any specific decisions or assumptions about OCO spending in any particular year. 11 Amounts in 2012 include requested increased funding for BBEDCA program integrity adjustments for the Department of Health and Human Services (+$270 million). The Budget request for $140 million to fully fund SSA’s program integrity cap adjustment for 2012 has been removed since the agency no longer has sufficient time to complete the additional program integrity work by the end of the fiscal year. 12 Amounts are not designated as Emergency funding pursuant to Section 251(b)(2)(A) of the BBEDCA, as amended. These amounts include congressionally-designated emergencies, rescissions of funding provided in the American Reinvestment and Recovery Act of 2009 (P.L. 111–5), and other supplemental funding. 13 These amounts exclude funding designated as OCO. SUMMARY TABLES (Budget authority in billions of dollars) Table S–14. FEDERAL GOVERNMENT FINANCING AND DEBT (Dollar amounts in billions) Estimate 2012 2013 2014 2015 2016 2017 60 Actual 2011 2018 2019 2020 2021 2022 Financing: Unified budget deficit: Primary deficit (+)/surplus (–) ���������������������������������������� Net interest ��������������������������������������������������������������������� Unified budget deficit �������������������������������������������������� 1,070 230 1,300 992 219 1,211 762 229 991 386 276 661 248 347 595 186 429 615 67 510 576 –40 583 543 –68 646 578 –101 705 604 –128 756 627 –152 804 652 As a percent of GDP ������������������������������������������������� 8.7% 7.8% 6.1% 3.9% 3.3% 3.2% 2.9% 2.6% 2.6% 2.6% 2.6% 2.6% –252 2 ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... Direct loan accounts ������������������������������������������������ 50 99 176 148 145 134 122 114 106 102 102 105 Guaranteed loan accounts ��������������������������������������� 10 14 12 1 –* 1 * 1 1 –1 –5 –5 Troubled Asset Relief Program (TARP) equity purchase accounts ��������������������������������������������� –2 –39 –19 –5 –3 –* –2 –* –* –5 * * –1 5 –* ......... –1 ......... –1 ......... –1 ......... –2 ......... –1 ......... –1 ......... –1 ......... –1 ......... –1 ......... –1 ......... Seigniorage on coins ������������������������������������������������������� –190 ......... 75 ......... 168 –* 142 –* 142 –* 134 –* 120 –* 114 –* 105 –* 95 –* 95 –* 99 –* Total, other transactions affecting borrowing from the public �������������������������������������������������� Other transactions affecting borrowing from the public: Changes in financial assets and liabilities:1 Change in Treasury operating cash balance �������������� Net disbursements of credit financing accounts: Net purchases of non-Federal securities by the National Railroad Retirement Investment Trust (NRRIT) �������������������������������������������������������������������� Net change in other financial assets and liabilities2 ���� Subtotal, changes in financial assets and liabilities ���� 75 168 142 141 133 119 114 105 95 95 99 1,109 1,286 1,158 803 736 749 696 657 684 699 723 752 Changes in Debt Subject to Statutory Limitation: Change in debt held by the public �������������������������������������� Change in debt held by Government accounts ������������������� Change in other factors ������������������������������������������������������� Total, change in debt subject to statutory limitation ���� 1,109 126 * 1,236 1,286 157 1 1,443 1,158 118 1 1,277 803 183 1 987 736 205 1 943 749 176 2 927 696 141 1 838 657 167 1 825 684 155 1 840 699 150 1 850 723 134 2 859 752 105 2 859 Debt Subject to Statutory Limitation, End of Year: Debt issued by Treasury ������������������������������������������������������ Adjustment for discount, premium, and coverage3 ������������ Total, debt subject to statutory limitation4 �������������������� 14,737 9 14,747 16,179 11 16,190 17,455 12 17,467 18,440 13 18,454 19,382 14 19,396 20,307 16 20,323 21,144 16 21,161 21,968 17 21,985 22,808 18 22,825 23,658 18 23,675 24,516 18 24,534 25,375 18 25,392 MID-SESSION REVIEW –190 Total, requirement to borrow from the public (equals change in debt held by the public) ����� Table S–14. FEDERAL GOVERNMENT FINANCING AND DEBT—Continued (Dollar amounts in billions) Estimate 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Debt Outstanding, End of Year: Gross Federal debt:5 Debt issued by Treasury ������������������������������������������������� Debt issued by other agencies ���������������������������������������� Total, gross Federal debt ��������������������������������������������� 14,737 27 14,764 16,179 28 16,207 17,455 28 17,483 18,440 29 18,469 19,382 29 19,410 20,307 28 20,336 21,144 28 21,172 21,968 27 21,996 22,808 27 22,834 23,658 26 23,683 24,516 24 24,540 25,375 22 25,397 Held by: Debt held by Government accounts ������������������������������� Debt held by the public6 �������������������������������������������������� As a percent of GDP ����������������������������������������������������� 4,636 10,128 67.7% 4,793 11,414 73.5% 4,911 12,572 77.5% 5,093 13,375 78.6% 5,299 14,112 78.4% 5,475 14,860 77.9% 5,616 15,556 77.1% 5,783 16,213 76.3% 5,938 16,896 75.9% 6,088 17,595 75.6% 6,222 18,318 75.4% 6,327 19,070 75.1% Debt Held by the Public Net of Financial Assets: Debt held by the public �������������������������������������������������������� 10,128 11,414 12,572 13,375 14,112 14,860 15,556 16,213 16,896 17,595 18,318 19,070 Less financial assets net of liabilities: Treasury operating cash balance ����������������������������������� 58 60 60 60 60 60 60 60 60 60 60 60 Credit financing account balances: Direct loan accounts ���������������������������������������������������� Guaranteed loan accounts ������������������������������������������� TARP equity purchase accounts ��������������������������������� Government-sponsored enterprise preferred stock ������� Non-Federal securities held by NRRIT �������������������������� Other assets net of liabilities ����������������������������������������� Total, financial assets net of liabilities ����������������������� 718 –22 75 133 21 –25 958 816 –9 36 151 21 –25 1,050 992 3 17 160 20 –25 1,227 1,140 4 11 162 19 –25 1,371 1,286 4 9 162 17 –25 1,513 1,420 5 9 162 16 –25 1,646 1,542 5 7 162 15 –25 1,766 1,656 7 7 162 14 –25 1,880 1,762 8 7 162 12 –25 1,985 1,864 6 2 162 11 –25 2,080 1,966 1 2 162 10 –25 2,175 2,071 –4 2 162 9 –25 2,275 9,170 61.3% 10,363 66.7% 11,345 69.9% 12,004 70.6% 12,599 70.0% 13,214 69.3% 13,791 68.4% 14,333 67.4% 14,911 67.0% 15,515 66.7% 16,143 66.4% 16,795 66.2% Debt held by the public net of financial assets ������� As a percent of GDP ��������������������������������������������� 61 * $500 million or less. 1 A decrease in the Treasury operating cash balance (which is an asset) is a means of financing a deficit and therefore has a negative sign; that is, the reduction in cash balances reduces the amount that would otherwise be borrowed from the public. An increase in checks outstanding (which is a liability) is also a means of financing a deficit and therefore also has a negative sign. 2 Includes checks outstanding, accrued interest payable on Treasury debt, uninvested deposit fund balances, allocations of special drawing rights, and other liability accounts; and, as an offset, cash and monetary assets (other than the Treasury operating cash balance), other asset accounts, and profit on sale of gold. 3 Consists mainly of debt issued by the Federal Financing Bank (which is not subject to limit), debt held by the Federal Financing Bank, the unamortized discount (less premium) on public issues of Treasury notes and bonds (other than zero-coupon bonds), and the unrealized discount on Government account series securities. 4 The statutory debt limit is $16,394 billion, as increased after January 27, 2012. 5 Treasury securities held by the public and zero-coupon bonds held by Government accounts are almost all measured at sales price plus amortized discount or less amortized premium. Agency debt securities are almost all measured at face value. Treasury securities in the Government account series are otherwise measured at face value less unrealized discount (if any). 6 At the end of 2011, the Federal Reserve Banks held $1,664.7 billion of Federal securities and the rest of the public held $8,463.5 billion. Debt held by the Federal Reserve Banks is not estimated for future years. SUMMARY TABLES Actual 2011 EXECUTIVE OFFICE OF THE PRESIDENT OFFICE OF MANAGEMENT AND BUDGET WASHINGTON, D.C.