Evening star. [volume] (Washington, D.C.) 1854-1972, 1962-07-20
S6.3 Billion Deficit
Counted in Fiscal 81

The Federal budget deficit
for the last fiscal year totaled
$6.3 billion-S667 million less
than predicted in January.
Figures released yesterday by
the Treasury Department and
the Budget Bureau showed that
the Government spent $87.7l
billion and received $81.4 bill
lion in fiscal 1862, the year
ended last June 80.
OUTLAWS were STA billion less
than estimated in President
. Kennedy's budget message in
January. and receipts fell short
Of the January estimate by
$40 million.
BY comparison, the Govern
ment spent $81.5 billion and
recelved $77.7 billion, for a.
deficit of $50 billion. in fiscal
1861.
President Eisenhower's budg-
ct, submitted a few days before
he left office, estimated fiscal
1862 expenditures at $500 bill
lion and receipts at 1923 bill
lion, for a surplus of SIS bill
lion.
The actual deficit of $6.3 bill
lion was the second largest re-
corded in peacetime. 1t was
topped only by the $12.4 bill
lion deficit in fiscal 1853.
=. Mr.. Kennedy predicted in
January a surplus of $463 mil
lion in fiscal 1868, the year that
began July /. But the economy
has Jagged behind expectations,
cutting into Federal revenues,
so q deficit of several billion
dollars now is anticipated.
Tax cuts, whether effective
this year or next, would in
crease the fiscal 1868 deficit.
It easily could exceed last
years.
81 Administration Criticized
Deficits last year and this
year have inspired conserva-
tives to charge the administra-
ton with fiscal responsibility |
But the President apparently
has been sold on the idea that |
even bigger deficits are needed
to stimulate the sluggish econ
omy. That's a big part of the
reason for his plan to cut taxes
next year, If not sooner.
The figures on expenditures, /
receipts and deficits are in
terms Of the conventional lad
ministrative" budget. The
President, in tune with current |
economic thought, has said the
administrative budget is prac-
tically irrelevant for economic
analysis.
Most economists concentrate |
on a version of the budget |
called the national income &C
counts" which includes trans
sections of Federal trust funds
and counts receipts and ex-
penditures on an accrual rath-
er than q cash basis.
Preliminary figures for the
national income accounts show
fiscal 1858 expenditures of sos
billion. receipts of $104 billion
and a deficit of 50 billion.
This deficit is much smaller
than the administrative deficit,
implying. that the Govern
ment's operations did not slim
ulate the economy very much
last fiscal year. But the budget |
was more expansionary than
anticipated last January, when
the national income accounts
deficit was estimated at only
$500 million.
Cash Statement Version
Still another version of the |
budget is the Consolidated |
cash statement" which is use
full to financial markets and |
for analyzing Treasury borrow
ing operations. This b udget
showed expenditures of $107.6
billion, receipts of $101.9 bill
lion and a deficit of $5.7 bill
lion in fiscal 1862.
On the administrative budg-
ct basis, major spending reduc- I
tons below January estimates
involved exports of farm sur
pluses, wheat and feed grain
subsidies. public welfare assist
ance, mortgage operations, for
eign aid, veterans housing and
pensions, and the delay in pur-
chasing United Nations bonds.
But OUTLAWS for interest on
the public debt exceeded jan
uary estimates by $40 million,
totaling more than $9.1 billion.
On the revenue side, individ-
ual income taxes topped jan
uary estimates by $3.50 million,
but low corporation profits in
calendar 1861 reduced corpora
ton income tax receipts 1904
million below expectations.
Budget Director Bell and
Treasury Secretary Dillon, in
q joint statement, said the
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