Evening star., 1951-07-01
U. 5. 10 Have Surplus
OF S3.3 Billion, Next
Largest in History
By the Associated Pres.

terday with the Government as
sured of the 18th budget surplus
in it's history, and the second big
gest of the lot.
Prospects are that the surplus
the excess of income over expend-
itures for the last IL months
will be about $3.3 billion when
the final tabulations are finished
by the Treasury late tomorrow.
That is far short of the $8.419
billion record high surplus of
l948, but it doubles the l.155 bill
lion second-high surplus Of the
past, recorded "a years ago. when
Calvin Coolidge was President.
However, this may be the last
surplus for some time. Billions of
dollars of red ink spending are in
prospect for the years Just ahead
unless Congress boosts taxes
higher than it now seems disposed
to do. or unless the administra-
tion's planned expenditures are
changed.
Surplus Not Expected.
A budget surplus always is more
novel than a deficit-the Govern
ment has run in the red IS years
compared with 76 in the black.
But this one has the added nov
city of having been run up during
a war, to use the popular word for
the Korean fighting.
The administration hadn't ex-
pected a surplus. When President
Truman laid down his original
budget program for fiscal 1851
back in January, 1850, he figured
the Government would spend
$42.4 billion, take in 1918 billions.
go $5.1 billion in the hole.
Of course he didn't foresee the
Korean situation then, or the huge
and rapid rearmament program
it gave rise to. Last January,
after six months of fighting and
defense mobilizing - and afterI
Congress gave him some tax
came up with another
set of estimates.
On that try. Mr.. Truman again
forecast the Government would
go in the hole. But he figured a
deficit of only $2.7 billion. While |
he saw outlays rising to $47.2 bill
lion he thought revenues would |
climb sharper-to $44.5 billion
thanks partly to the tax boosts.
Figures About Reversed.
AS matters stand now, it looks
like the President had the ex-
penditure and receipt figures
mixed up: Revenues should hit |
around $48 billion, outlays around
S44 billion, thus putting the Gov
ernment around $3.3 billion in
the black.
The happy ending for fiscal
1851 is chiefly the product of these
circumstances:
/. Revenues were increased not
only by boosts in tax rates, but
also rose markedly as inf1ation
gave individuals and corporations
more income on which to pay
5axes; also. imitation pushed upl
the dollar volume of sales of goods
from which the Government takes
cut through excise taxes.
2. Imitation. although it added
to some Government costs, sharply
cut others-supporting farm prices
cost around 81 billion less than
a year ago because prices didn't
require propping; veterans bene-
f1t programs cost about $3.50 mil
lion less. partly because prosper
ing veterans didn't need as much
aid.
3. Some Federal outlays were de-
iberately curtailed: the Govern
nent spent less money to buy up
mortgages, for example, because
It's own anti-inf1ation program in-
,ludes an attempt to reduce mort.
gage credit rather than increase
t.
4. Military expenditures - and
Ibis was important - never got as
nigh as anticipated. The orders
we're for military goods, but de-
liveries Jagged behind expecta-
ions, and expenditures dragged
the Government doesn't
,ay before delivery.
More and more South Africanl
frrn IL |