Master Class Policy and Budgetary Forecasting

Congressional Budget Office

THE ECONOMIC AND BUDGET OUTLOOK:

AN UPDATE

AUGUST 1998

Summary Table 4. CBO Baseline Budget Projections, Assuming Compliance with Discretionary Spending Caps (By fiscal year) Actual

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Deficit (-) or Surplus -22 63 80 79 86 139 136 154 170 217 236 251

On-budget deficit (-)

or surplus -103 -41 -37 -46 -45 1 10 a 5 44 55 64

Off-budget surplus 81 104 117 125 131 138 146 154 165 173 181 186

Cernik notes here

The TOTAL deficit in ACTUAL 1997 was -$22 billion (the -$103 billion and the +$81 billion come to -$22 billion).

The -$22 billion is known as the UNIFIED BUDGET. The ON-BUDGET is all expenses WITHOUT Social Security.

The OFF-BUDGET is the Social Security Trust Fund. So, the Social Security Trust Fund money helped to bring

down the UNIFIED BUDGET’S deficit. There was a surplus (not a deficit) in the Social Security Trust Fund, which

means that through your withholding taxes being taken out of your paycheck going into the Social Security Trust

Fund, the Federal Government had money left over after sending your grandmother her monthly Social Security

check. That leftover money was used toward helping to reduce the overall Federal Government’s budgetary deficit

(the UNIFIED BUDGET).

Why break down the Federal Government budget this way? Because by seeing the UNIFIED BUDGET, OFF-

BUDGET, ON-BUDGET you can get a sense of the importance of the Social Security Trust Fund.

Where did I get the following actual deficit or surplus amounts for each of the Fiscal Years? From the annual reports

titled, “The Budget and Economic Outlook: An Update,” put out by the CBO.

1998 $69 Billion

1999 $124 Billion

2000 $236 Billion

2001 $127 Billion

2002 -$158 Billion

2003 -$375 Billion

2004 -$412 Billion

2005 -$318 Billion

2006 -$248 Billion

2007 -$161 Billion

2008 -$459 Billion