Budget surplus down sharply from last year

The Congressional Budget Office's monthly budget review reported that the federal government's total budget surplus for the first 10 months of fiscal 2001 was $168 billion--or about $14 billion less than for the same period in the previous fiscal year. The surplus for the full fiscal year, will be "well below the $236 billion figure recorded last year because of continuing weakness in the economy and recently enacted legislation," to cut taxes by $1.35 trillion over 11 years and spend an additional $5.5 billion in fiscal 2001 on aid to farmers, as well as other legislation Congress has enacted so far this year, CBO said.

CBO is expected to release its mid-session economic review--widely expected to project lower budget surplus figures than were used in the fiscal 2002 budget resolution--later this month. CBO also reported a 13 percent increase in Medicaid spending this year--although spending for the entire year is expected to grow only by 10 percent. Medicare spending has risen by 8.4 percent.