CBO Issues Monthly Budget Review

CBO issued its monthly review for June, finding that so far this year, the federal government has run a deficit of just over $1 trillion, $81 billion lower than over the same period last year. The drop in deficits is due to a decrease in outlays and a slight increase in revenues over last year.

Revenues have inched up by $8 billion this year, despite a drop in individual income and social insurance revenues. The increase is based on corporate income tax increases and higher receipts for the Federal Reserve due to their vast expansion of their balance sheet (see stimulus.org for details.)

The decrease in outlays comes despite increases in many programs in the budget, including defense, Social Security, Medicare, Medicaid, and unemployment insurance. However, TARP program costs have dropped by about $250 billion from last year, actually gaining $110 billion for the federal government so far this year.

The June deficit comes in at $69 billion, $25 billion lower than last year, with all of that increase coming on the strength of revenue.

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Student Loans Cost $340 Billion More than Expected

Based in part on new data from the Congressional Budget Office, this piece shows: The estimated federal cost of student loans issued between 2015 and 2024 has increased by $340 billion – from a projected gain of $135 billion in the 2014 baseline to an expected loss of $205 billion in the 2024 baseline. Much of the cost increase can be explained by the expansion and increased enrollment in income-driven repayment (IDR). In forward projections, graduate school loans are now nearly as subsidized as undergraduate loans and make up half of the cost of newly issued student loans. Reforming graduate loans to be cost-neutral would generate over $100 billion in deficit reduction over the next decade.

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