A Few Interesting Reports from CBO
In the past few days, CBO has released a few documents that might be of interest to budget wonks.
The first is a further analysis of the final FY 2011 spending agreement that was passed a month ago. The estimate not only shows CBO's updated discretionary spending estimates for this year, but also what discretionary spending will be over ten years using CBO's baseline convention of inflation growth.
The big headline grabber was the fact that the spending deal will actually increase outlays in 2011 by $3 billion relative to CBO's March baseline, because more of the defense budget authority will be used in FY 2011 than originally projected. However, budget authority for this year is still reduced by $23 billion ($25 billion from non-defense programs and a $2 billion increase for defense). Over the ten-year period of 2012-2021, outlays would be $122 billion lower and budget authority would be $183 lower than the March baseline. Of course, as with any projection of discretionary spending, these savings are only hypothetical: discretionary spending for those ten years will be set by future Congresses in those years.
The second interesting piece is a Senate Finance Committee testimony by CBO's own Joseph Kile on imbalances in the highway trust fund and how to pay for future highway spending. As a result of spending boosts over the past decade, outlays on highways have been greater than revenues from the fuel taxes (the big one being the 18.4 cent gas tax) that pay for them; the result is that there have been some transfers of general revenue to the trust fund since 2008, the latest being tacked on to the HIRE Act from last March. Because of the current law shortfall in the Trust Fund, it is expected to fall to zero by 2013. Kile's testimony sums up federal spending on highways and reviews the options available to pay for that spending, including altering user fees, motor fuel taxes, a vehicles miles traveled (VMT) tax, and general revenues from taxpayers.
Be sure to check out both of these documents if you're interested in a few of the nuances of the budget.