Congress Budget Experts Project $74-Billion Deficit

Congress’ budget experts said today that lawmakers and President Bush will need to find $74 billion in savings to meet next year’s deficit target.

The estimate by the Congressional Budget Office, made to the Senate Budget Committee, is more than double the amount the Administration is expected to say it needs in savings.

It also continues a long tradition of disagreeing deficit forecasts between the two branches.

Bush submits his fiscal 1991 budget to Congress on Monday. He is expected to say $30 billion to $35 billion in new revenues and spending cuts are needed to meet the $64-billion deficit target mandated by the Gramm-Rudman balanced-budget law.

The report by CBO--Congress’ fiscal analysis arm--projects a $138-billion deficit for fiscal 1991, which begins Oct. 1, unless savings are found. Bush is expected to ask for $1.23 trillion in spending for next year.

The CBO report contains even more bad news for the future.

Gramm-Rudman requires declining deficits every year until 1993, when the budget is required to be balanced.

But according to CBO, deficits are projected to be $135 billion in 1992 and $141 billion in 1993, declining slowly over the next two years.

“Without spending cuts or tax increases, the deficit in 1993 is likely to be no lower than in 1990,” CBO Director Robert D. Reischauer told senators.

The huge difference between the CBO projections and the Administration’s numbers are due to differing expectations about economic performance.

The White House Office of Management and Budget is expected to forecast that the economy will expand this year by about 2.6%, measured from the fourth quarter of last year through the third quarter of 1990. CBO’s projection is 1.8%.