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    September MBR

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    Wendy Christopher
    The Congressional Budget Office estimates that the 2010 federal budget deficit was slightly less than $1.3 trillion, down from $1.4 trillion in 2009. Revenues increased by $57 billion to $2.16 trillion while outlays decreased by $67 billion to $3.45 trillion. The deficit was 8.9% of GDP, lower than the 10.0% deficit in 2009. Receipts grew due to higher corporate income taxes and payments from the Federal Reserve, while outlays fell mainly from reduced costs of the TARP program and payments to Fannie Mae and Freddie Mac.

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    September MBR

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    Wendy Christopher
    21 views2 pages
    The Congressional Budget Office estimates that the 2010 federal budget deficit was slightly less than $1.3 trillion, down from $1.4 trillion in 2009. Revenues increased by $57 billion to $2.16 trillion while outlays decreased by $67 billion to $3.45 trillion. The deficit was 8.9% of GDP, lower than the 10.0% deficit in 2009. Receipts grew due to higher corporate income taxes and payments from the Federal Reserve, while outlays fell mainly from reduced costs of the TARP program and payments to Fannie Mae and Freddie Mac.

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    SeptemberMBR

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    The Congressional Budget Office estimates that the 2010 federal budget deficit was slightly less than $1.3 trillion, down from $1.4 trillion in 2009. Revenues increased by $57 billion to $2.16 trillion while outlays decreased by $67 billion to $3.45 trillion. The deficit was 8.9% of GDP, lower than the 10.0% deficit in 2009. Receipts grew due to higher corporate income taxes and payments from the Federal Reserve, while outlays fell mainly from reduced costs of the TARP program and payments to Fannie Mae and Freddie Mac.

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    21 views2 pages

    September MBR

    Uploaded by

    Wendy Christopher
    The Congressional Budget Office estimates that the 2010 federal budget deficit was slightly less than $1.3 trillion, down from $1.4 trillion in 2009. Revenues increased by $57 billion to $2.16 trillion while outlays decreased by $67 billion to $3.45 trillion. The deficit was 8.9% of GDP, lower than the 10.0% deficit in 2009. Receipts grew due to higher corporate income taxes and payments from the Federal Reserve, while outlays fell mainly from reduced costs of the TARP program and payments to Fannie Mae and Freddie Mac.

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    of 2

    MONTHLY BUDGET REVIEW

    Fiscal Year 2010


      A Congressional Budget Office Analysis 
    Based on the Monthly Treasury Statement for August
    and the Daily Treasury Statements for September October 7, 2010

    CBO estimates that the federal budget deficit was slightly less than $1.3 trillion in fiscal year 2010 and $125 billion
    less than the shortfall recorded in 2009. The 2010 deficit was equal to 8.9 percent of gross domestic product (GDP),
    CBO estimates, down from 10.0 percent in 2009 (based on the most current estimate of GDP). The 2010 deficit was
    the second-highest shortfall—and 2009 the highest—since 1945, relative to the size of the economy. CBO’s deficit
    estimate is based on data from the Daily Treasury Statements and CBO’s projections; the Treasury Department will
    report the actual deficit for fiscal year 2010 later this month.

    AUGUST RESULTS $4 billion (or 44 percent). Withholding for income and


    (Billions of dollars) payroll taxes increased by $6 billion (or 5 percent).
    Nonwithheld individual income and payroll taxes,
    Preliminary mainly from quarterly estimated payments of 2010
    Estimate Actual Difference income taxes, rose by $2 billion (or 3 percent). Other
    receipts fell by $2 billion, on net.
    Receipts 162 164 2
    Outlays 258 255 -3
    Outlays were $13 billion (or 5 percent) higher in
    Deficit (-) -95 -91 5 September than in the same month last year, CBO
    estimates. The estimated net cost of the Troubled Asset
    Sources: Department of the Treasury; CBO. Relief Program (TARP) was about $13 billion higher
    this September than last September; that difference
    The Treasury recorded a deficit of $91 billion for occurred almost entirely because a reduction in the
    August, about $5 billion less than CBO had projected on previously estimated subsidy costs for the program was
    the basis of the Daily Treasury Statements. That recorded in September 2009. Spending for the
    difference occurred largely because spending for Department of Education was up by $8 billion from last
    defense and education was lower than expected. September. Expenditures for the Federal Deposit
    Insurance Corporation and net interest on the public
    ESTIMATES FOR SEPTEMBER debt rose by $3 billion each, and spending for Social
    (Billions of dollars) Security and Medicaid increased by $2 billion each.
    Those increases were partially offset by a $9 billion
    Actual Preliminary Estimated reduction in net payments to Fannie Mae and Freddie
    FY 2009 FY 2010 Change Mac and by an increase of $9 billion in the Treasury’s
    interest earnings from credit programs.
    Receipts 219 245 26
    Outlays 264 277 13
    FISCAL YEAR TOTALS
    Deficit (-) -45 -32 14 (Billions of dollars)

    Sources: Department of the Treasury; CBO. Actual Preliminary Estimated


    FY 2009 FY 2010 Change
    The deficit in September 2010 was $32 billion, CBO
    estimates, $14 billion less than the shortfall recorded a
    Receipts 2,104 2,162 57
    year ago. Quarterly payments of estimated individual Outlays 3,520 3,453 -67
    and corporate income taxes typically result in a surplus Deficit (-) -1,416 -1,291 125
    for September; however, revenues remain relatively low
    and spending was relatively high, resulting in the 24th Sources: Department of the Treasury; CBO.
    consecutive month of budget deficits.
    CBO estimates that the federal deficit was slightly less
    CBO estimates that receipts in September were about than $1.3 trillion in 2010, down from slightly more than
    $26 billion (or 12 percent) higher than receipts in $1.4 trillion in 2009. Outlays declined by $67 billion,
    September 2009. Corporate income tax receipts, which and revenues increased by $57 billion. The estimated
    rose by about $20 billion, account for most of the deficit is about $51 billion lower than CBO projected in
    increase; gross corporate income tax receipts grew by August. Outlays were lower and revenues were higher
    $17 billion (or 45 percent), and corporate refunds fell by than previously expected.

    Note: Unless otherwise indicated, the figures in this report include the Social Security trust funds and the Postal Service fund,
    which are off-budget. Numbers may not add up to totals because of rounding.
    TOTAL REVENUES TOTAL OUTLAYS
    (Billions of dollars) (Billions of dollars)

    Actual Preliminary Percentage Actual Preliminary Percentage


    Major Source FY 2009 FY 2010 Change Major Category FY 2009 FY 2010 Change

    Individual Income 915 901 -1.6 Defense—Military 637 667 4.7


    Corporate Income 138 192 38.6 Social Security
    Social Insurance 891 863 -3.2 Benefits 660 696 5.4
    Federal Reserve 34 76 121.0
    Medicarea 429 450 4.9
    Other 126 131 4.2
    Medicaid 251 273 8.7
    Total 2,104 2,162 2.7
    Unemployment
    Sources: Department of the Treasury; CBO.
    Benefits 120 160 34.3
    Other Activities 977 1,047 7.1
    CBO estimates that total receipts rose by 3 percent in Subtotal 3,073 3,292 7.1
    2010, following declines in each of the prior two years. Net Interest on the
    Growth in receipts of corporate income taxes and Public Debt 202 228 13.2
    remittances from the Federal Reserve more than offset TARP 154 -108 -170.0
    reduced collections of individual income and payroll Payments to GSEs 91 40 -55.7
    taxes in 2010. Total 3,520 3,453 -1.9

    Corporate income tax receipts rose by $53 billion (or Sources: Department of the Treasury; CBO.
    39 percent) in 2010; improved economic conditions and Note: TARP = Troubled Asset Relief Program; GSE = government-
    the expiration of legislation that allowed taxpayers to sponsored enterprise.
    take higher depreciation charges in 2009 has resulted in a. Medicare outlays are net of proprietary receipts.
    higher taxable profits in 2010. (The Small Business Jobs
    Act of 2010, which became law in late September, Outlays ended the year about 2 percent below those in
    extended through tax year 2010 the allowance for higher 2009, CBO estimates. That decline resulted primarily
    depreciation charges; that retroactive change will reduce from a net reduction in outlays for three items related to
    revenues in fiscal year 2011.) Receipts from the Federal the financial crisis: the costs of the TARP ($262 billion
    Reserve increased by $42 billion this year, to more than lower than in 2009), payments to Fannie Mae and
    double the amount received in 2009. The central bank’s Freddie Mac ($51 billion lower), and federal deposit
    increased profits resulted from an enlarged portfolio and insurance ($55 billion lower). Excluding those three
    a shift to riskier and thus higher-yielding investments in programs, spending rose by about 9 percent in 2010,
    support of the housing market and the broader economy. somewhat faster than in recent years.

    Those increases were partially offset by a drop in the Payments for unemployment benefits rose by 34 percent
    total of individual income and payroll taxes, which were in 2010 because of high unemployment and increased
    about $43 billion (or 2 percent) lower than those benefits provided by various laws, including the
    receipts in 2009. Withheld income and payroll taxes American Recovery and Reinvestment Act (ARRA).
    declined by about $13 billion (or 1 percent), and Other ARRA provisions led to double-digit growth in
    nonwithheld receipts fell by about $35 billion (or spending for programs in the “Other Activities”
    10 percent). In both instances, the declines occurred category—particularly the State Fiscal Stabilization
    early in the fiscal year and were largely attributable to Fund, refundable tax credits, and certain education
    lower collections of tax liabilities incurred in 2009. In programs. Apart from deposit insurance, outlays for that
    the past five months, collections of withheld and broad category were 13 percent higher than in 2009.
    nonwithheld taxes, which were based on income in
    2010, were 4 percent higher than in the same period last In contrast, defense spending grew more slowly than in
    year. The overall reduction in withheld and nonwithheld recent years, increasing by about 5 percent in 2010 after
    receipts was partially offset by a $7 billion increase in rising by an average of 8 percent annually from 2005
    collections of unemployment insurance taxes, resulting through 2009. Medicare and Social Security outlays
    primarily from the efforts of states to replenish their rose by about 5 percent this year, somewhat less than in
    unemployment trust funds. Other tax receipts rose by most recent years. The 9 percent increase in Medicaid
    $4 billion, on net, compared with such revenues last outlays partly reflects a temporary increase in the
    year. federal share of Medicaid assistance authorized in
    ARRA; excluding ARRA-related expenditures,
    Medicaid outlays rose by about 6 percent.

    Prepared by Elizabeth Cove Delisle, Barbara Edwards, Daniel Hoople, and Joshua Shakin.
    This Monthly Budget Review and other CBO publications are available at www.cbo.gov.

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