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This analysis of the President's budget for fiscal year 1996 was prepared at the request of the Senate Committee on Appropriations. The report discusses the President's policies in terms of changes from the Congressional Budget Office's (CBO's) baseline budget projections for 1996 through 2000. It provides estimates of the budgetary impact of the Administration's proposals using CBO's economic assumptions and technical estimating methods.

The report was prepared by the staffs of the Budget Analysis, Macroeconomic Analysis, and Tax Analysis divisions under the supervision of Paul Van de Water, Robert Dennis, and Rosemary D. Marcuss. James Horney wrote Chapters 1 and 3, John Peterson wrote Chapter 2, and Frank Sammartino wrote Chapter 4. Appendix A was written by Jeffrey Holland, and Appendix B was written by Robert Dennis. The baseline revenue estimates were prepared under the direction of Richard A. Kasten. The estimates of the President's revenue proposals were prepared by the Joint Committee on Taxation. The principal contributors to the revenue and spending estimates and analyses are listed in Appendix C.

Paul L. Houts supervised the editing and production of the report. Major portions were edited by Paul L. Houts, Sherwood D. Kohn, Leah Mazade, Sherry Snyder, and Chris Spoor. Chris Spoor also provided editorial assistance during production. The authors owe thanks to Marion Curry, Dorothy Kornegay, Linda Lewis, L. Rae Roy, and Simone Thomas, who assisted in the preparation of the report. Kathryn Quattrone prepared it for final publication.

June E. O'Neill
Director
April 1995
 
 

ONE - SUMMARY AND INTRODUCTION

• CBO's Reestimate of the President's Budgetary Proposals
• CBO's Estimate of the Effects of the President's Budgetary Proposals

TWO - COMPARISON OF ECONOMIC FORECASTS

• The Short-Term Outlook, 1995-1996
• The Outlook for the Projection Period, 1997-2000

THREE - THE ADMINISTRATION'S SPENDING PROPOSALS

• Mandatory Spending
• Discretionary Spending

FOUR - THE ADMINISTRATION'S REVENUE PROPOSALS

• Tax Relief for Middle-Income Families
• Modifying the Earned Income Tax Credit Eligibility Rules
• Other Revenue Proposals

APPENDIXES

A -CBO's Baseline Budget Projections
B - Economic and Budgetary Implications of Balancing the Budget
C - Major Contributors to the Revenue and Spending Projections
 

TABLES
1.	CBO's Budgetary Estimates Under the President's Policies
2.	CBO's Reestimates of the President's Budgetary Proposals
3.	CBO's Estimates of the President's Budgetary Proposals
4.	Comparison of Congressional Budget Office, Administration, and Blue Chip Economic Projections, Calendar Years 1994-2000
5.	CBO's Estimates of the President's Spending Proposals
6.	Estimates of the President's Pay-As-You-Go Spending Proposals
7.	Estimates of the President's Asset Sale Proposals
8.	Pay Raises Under CBO's Current-Law Assumptions and the President's Budget
9.	The Administration's Proposals for Discretionary Spending in Fiscal Year 1996
10.	CBO's Estimates of Revenues Under the President's Proposals
11.	Comparison of Revenue Estimates of the President's 1996 Budgetary Proposals
12.	Comparison of Revenue Estimates of the President's 1996 Budgetary Proposals to Provide Tax Relief to Middle-Income Families
13.	Comparison of Revenue Estimates of the President's 1996 Budgetary Proposals to Modify Eligibility Rules for the Earned Income Tax Credit
14.	Comparison of Revenue Estimates of Other Tax Provisions in the President's 1996 Budget
A-1.	Changes in CBO's Baseline Deficit Projections
A-2.	CBO's Deficit Projections
A-3.	CBO's Baseline Budget Projections with Discretionary Inflation After 1998
A-4.	CBO's Baseline Projections for Mandatory Spending
A-5.	How Tight Are the Discretionary Caps?
A-6.	CBO's Baseline Projections for Interest Costs and Federal Debt
A-7.	The Budget Outlook Through 2005 with Discretionary Inflation After 1998
A-8.	The Budget Outlook Through 2005 Without Discretionary Inflation After 1998
B-1.	Illustrative Deficit Reduction Path
B-2.	Potential Economic Impacts of Balancing the Budget by 2002 Compared with CBO's January Economic Forecast
B-3.	CBO's January Economic Forecast After Adjusting for the Economic Impacts of Balancing the Budget
B-4.	Change in the Federal Deficit Resulting from the Economic Impacts of Balancing the Budget by 2002

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