MBRMAR07

Legislation News & Report (TM)

TheWeekInCongress.com (TM)

Monthly Budget Review

Home

Contact: House / Senate

Newest Public Laws

Monthly Budget Review

Legislation in the Spotlight

Privacy

About Us

TheWeekInCongress.com

The Monthly Budget Review March 2007

The Federal Government-incurred deficit for the first five months of fiscal year 2007 beginning on October 1, 2006 is $165 billion about $52 billion less than at the same time last year. If, however, the President’s request for supplemental spending on Iraq and Afghanistan (estimated $100 billion) is approved the deficit may rise to $214 billion for fiscal year 2007. The estimated deficit for February is $123 billion.

WHAT HAPPENED?

There was a $38 billion surplus in January 2007. $261 billion in receipts outweighed $222 billion in outlays for a $38 billion surplus that month. February took in $120 billion against spending of $243 billion for a $123 billion overdraft. The February deficit is $4 billion more than the same time last year.

The CBO explains that February payroll taxes rose by $10.5 billion but were offset by higher individual income tax refunds absorbing the $4 billion in growth. Corporate tax receipts were mostly flat.

FEBRUARY 2007 ESTIMATES

	Actual FY 2006	FY 2007	Est. Change
Receipts	$113 billion	$120 billion	7%
Outlays	$232 billion	$243 billion	11%
Deficit	-$119 billion	-$123 billion	-4%

WHERE THE MONEY CAME FROM

Receipts Through February 2007

Source	Actual FY 2006	FY 2007	% Change
Income taxes	$393 Billion	$443 billion	12.8%
Corp taxes	$94 billion	$114 billion	21.0%
Social Insurance	$322 billion	$335 billion	-3.6%
Other	$64 billion	$61 billion	-3.6%
Total	$873 billion	$954 billion	9.3%

Individual and corporate taxes are 14% higher than last year this time. Social insurance payroll tax collection is slower to grow. January receipts are susceptible to taxes paid on year end job bonuses and non-withheld receipts increased as well due to final quarterly estimated tax payments for 2006 made in January.

WHERE THE MONEY WENT

Category	Actual FY 2006	FY 2007	Change Actual	Adjusted Chng
Defense	$202 billion	$219 billion	8.4%	8.2%
Social Security	$222 billion	$235 billion	5.9%	6.1%
Medicare	$144 billion	$178 billion	24.3%	17.6%
Medicaid	$74 billion	$77 billion	4.3%	4.3%
Other	$356 billion	$314 billion	-11.9%	-11.6%
SubTotal	$998 billion	$1,024 Trillion	2.6%	1.8%
Debt Interest	$92 billion	$95 billion	3.3%	3.3%
Total	$1,091 Trillion	$1,119 Trillion	2.6%	1.9%

February outlays were about 2% higher this year. Disaster relief spending declined by $24 billion from last year’s expenditures and $13 billion was taken in by auctioning off the nation’s airwaves resulting in an absorption of a total first five month increase over last year spending of about 5%.

Medicare spending continues to rise as the program still is absorbing the billions spent on the prescription drug program. Medicaid spending, usually unchanged since prescription drugs coverage was removed to the Medicare plan. Inflation influences that program too.

BUDGET OUTLOOK ESTIMATES FOR FY 2007

	CBO	OMB
Receipts	$2.533 trillion	$2.540 trillion
Outlays	$2.747 trillion	$2.784 trillion
Deficit	$214 billion	$244 billion

CBO calculates that given passage of the President’s war supplemental the deficit will remain at 1.6% of the GDP. The CBO /OMB differences are due to CBO’s belief that defense and disaster spending will be lower than the OMB estimates.

The report is a revised version of the CBO’s Monthly Budget Review prepared by Prepared by Mark Booth, Chad Chirico, Barbara Edwards, and Kathy Gramp of CBO

No reproduction, language translation or distribution without written permission from TheWeekInCongress.com.(TM)