–Sees FYTD Deficit Of -$905 Bln Vs -$971 Bln A Year Ago

WASHINGTON (MNI) – The following are excerpts from the
Congressional Budget Office’s Monthly Budget Review published Monday:

CBO estimates that the Treasury Department will report a deficit of
$905 billion for the first nine months of fiscal year 2012, $66 billion
less than the $971 billion deficit incurred through June 2011. Outlays
are about 1 percent higher and revenues are about 5 percent higher than
they were at the same point last year. Those results include adjustments
to the estimated cost of the Troubled Asset Relief Program that
increased outlays in 2012 by $21 billion and decreased outlays in 2011
by $42 billion. Without those adjustments, the deficit for the first
nine months of fiscal year 2012 would have been around $130 billion less
than the deficit incurred during the same period in fiscal year 2011.

The Treasury reported a deficit of $125 billion for May, about the
same as what CBO had projected on the basis of the Daily Treasury
Statements.

The deficit in June was $60 billion, CBO estimates, $17 billion
more than the shortfall recorded a year ago. Spending last month was
influenced by the shift of certain payments from July to June; if not
for those timing shifts, the deficit in June 2012 would have been $19
billion less than the shortfall in June 2011.

Receipts in June were $11 billion (or 4 percent) higher than those
in June 2011, in CBOs estimation. Net receipts of corporate income
taxesprimarily for estimated payments for 2012 tax liabilitiesrose by
$8 billion (or 17 percent), accounting for about threefourths of the
revenue gain. Together, individual income and payroll tax receipts rose
by $2 billion. Increases of about $2 billion in both withheld and
nonwithheld taxes were partially offset by a $2 billion increase in
refunds of individual income taxes.

Outlays were $28 billion higher this June than they were in the
same month last year, mostly because about $36 billion in payments that
would ordinarily have been made in July were instead made in June this
year (because July 1 fell on a Sunday). In addition, annual revisions to
the estimated cost of several credit programsmostly student
loansreduced outlays by $11 billion less this June than they did in
June last year.

Absent those effects, outlays would have been $19 billion less in
June 2012 than in June 2011.

Net payments to Fannie Mae and Freddie Mac were $9 billion lower
this June than in June 2011, as the government provided smaller cash
infusions to the two entities. If the effects of shifts in the timing of
some payments are excluded, spending for military activities declined by
$5 billion. Outlays for Medicaid fell by $4 billion, and spending for
unemployment benefits and for net interest on the public debt each fell
by $3 billion. In contrast, outlays for Medicare were $1 billion higher
than in June 2011.

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MFU$$$,MCU$$$,M$$CR$]