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Emergency Spending in Budget Deficit?

  1. May 26, 2006 #1
    Can anyone tell me whether or not Emergency Spending bills, like the 109 Billion dollar bill currently in Congress, are included in the CBO (Congressional Budget OFfice) figures for annual US deficit?

    "...On May 4, the Congressional Budget Office revised its estimate of the deficit for the current fiscal year (2006) to “significantly less than $350 billion, perhaps as low as $300 billion, assuming enactment of the pending supplemental appropriations and tax reconciliation legislation."

  2. jcsd
  3. May 27, 2006 #2


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    Staff: Mentor

    I have heard that so-called "supplemental spending bills", which includes expenditures on the war in Iraq, do not count toward the "budget" deficit. Maybe there are two sets of books. :rolleyes:
  4. May 27, 2006 #3
    Well, sadly, there are most certainly two set of books.

    The Congressional Budget process - what is typically thought of as "the Budget for ..." - is a set of 13 or 14 appropriations bills that come together to form the US Federal Budget for any particular FY. Thankfully, this is subject to a budget cap, so that Congress and the US Federal Government can only spend so much in one year.

    However, these so-called "emergency" spending bills - the latest one (as yet unsigned) totalling $109 Billion dollars - are NOT part of the formal budgetary process and as such are not subject to restrictions. They are essentially blank checks, only to be used in emergencies, which is why everyone is so pumped that the latest one includes millions for protecting oyster fisheries and half a billion to move a railline in Mississippi.

    They are also not referred to by politicians who talk about having cut budget spending or scaled it back OR in official budget - and I presume deficit - figures listed by the government unless otherwise noted.

    So there are definitely two sets of books - one red, and the other really red.

    But what I'm not sure about is whether the CBO deficit estimate above includes things like emergency spending.

    I kinda don't think it does because it'd have to be betting either for or against this emergency spending bill (which is still up in the air) for over half of it's estimate.

    Also, emergency spending bills are written straight into the deficit, to be paid for "later".
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