Monday, February 13, 2012

The White House releases the 2013 budget

The White House just released their proposed 2013 budget.  Here is my analysis:

For 2012, I previously projected revenues of 2523 and outlays of 3752 for a deficit of 1229.  The White House budget projects revenues of 2469 and outlays of 3796 for a deficit of 1327.  They are projecting lower spending on Medicare, Medicaid and Interest than I am, and much higher amounts in the "Other" category:  1988 vs. my projection of 1876.  I find this troubling.  I don't think the OMB has good handle on Medicare or Medicaid expenses, and I got my numbers from the CBO.  I do believe them when they say there will be more discretionary spending, so the truth is we are looking at a 1.4 trillion dollar deficit for 2012, and I need to redo my numbers to reflect the deteriorating situation.

For 2013, the OMB is projecting receipts of 2902 and outlays of 3803 for a deficit of 901.  I think revenue will be lower because of the payroll tax cut extension and because of the AMT fixes that occur every year. They are projecting "Other" expenses to be reduced to 1778, a reduction of 210 from 2012.  71 of this comes from sequestration.  I don't think sequestration will happen and I don't understand where the other cuts are coming from.  So the truth is the 2013 deficit will be over 1.2 trillion.

Update: I will add Defense as a separate category the next time I update it. The number for 2011 for Defense was 678.   The projection in the OMB budget for Defense is 709 for 2012 and 700 for 2013.

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