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YES. It’s almost there. The federal budget deficit fell to a 23-year low of $23 billion in FY97. The budget will move into surplus by 2002 for the first time since 1969, according to the latest projections of the Congressional Budget Office. But there’s a big asterisk here: unlike the surplus in 1969, this one will be achieved with the aid of a bogus surplus in the Social Security Trust Fund. Without this accounting gimmick 2002 would be just another in a long string of deficits.

Ever since 1990, federal spending has declined as a share of GDP. That’s the good news. The bad news is that this is almost entirely due to the decline in defense spending from 5.3 per cent of GDP in 1990 to 3.4 per cent now (1997). Non-defense spending under President Clinton has remained at about 17.2 per cent of GDP despite the vibrant economy—meaning that it has increased substantially in dollar terms.

ER

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Ed Rubenstein

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YES. It’s almost there. The federal budget deficit fell to a 23-year low of $23 billion in FY97. The budget will move into surplus by 2002 for the first time since 1969, according to the latest projections of the Congressional Budget Office. But there’s a big asterisk here: unlike the surplus in 1969, this one will be achieved with the aid of a bogus surplus in the Social Security Trust Fund. Without this accounting gimmick 2002 would be just another in a long string of deficits.

Ever since 1990, federal spending has declined as a share of GDP. That’s the good news. The bad news is that this is almost entirely due to the decline in defense spending from 5.3 per cent of GDP in 1990 to 3.4 per cent now (1997). Non-defense spending under President Clinton has remained at about 17.2 per cent of GDP despite the vibrant economy—meaning that it has increased substantially in dollar terms.