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Unless otherwise indicated, all years referred to in this report are fiscal years. Details in the text and tables may not add to totals because of rounding. |
This analysis of the President's 1984 credit budget was prepared at the request of the House and Senate Budget Committees. It presents the Congressional Budget Office's baseline credit budget projections together with CBO's reestimate of the President's credit budget proposals. The report also provides estimates of the savings in federal outlays that would result from the Administration's proposed credit budget reductions. Finally, it presents a function-by-function examination of the 1984 credit budget.
The paper was prepared by CBO's Budget Process Unit. Richard P. Emery,
Jr., wrote the first three chapters. Deirdre B. Phillips and Amy R. White
wrote Chapter IV. The authors gratefully acknowledge the assistance of
Charles J. Richardson and CBO's cost analysts in developing baseline credit
budget projections, and the helpful comments of Linwood T. Lloyd and Marvin
M. Phaup of CBO and Edward Brigham of the House Committee on the Budget.
Francis S. Pierce edited the manuscript, which was prepared for publication
by Paula Gatens and Nancy E. Wenzel.
Alice M. Rivlin
Director
March 1983
SUMMARY
CHAPTER I. INTRODUCTION TO THE CREDIT BUDGET
CHAPTER II. THE ADMINISTRATION'S CREDIT BUDGET PROPOSALS
CHAPTER III. BUDGET IMPACT OF THE CREDIT BUDGET
CHAPTER IV. THE CREDIT BUDGET BY MAJOR BUDGET FUNCTION
FIGURES | |
1. | FEDERAL CREDIT AS A PERCENTAGE OF GNP |
2. | COMPONENTS OF NET FEDERAL CREDIT |
The President's credit budget for 1984 continues the Administration's efforts to constrain the credit activities of the federal government. The Administration argues that direct and guaranteed lending by the federal government, which grew rapidly during the second half of the 1970s, must be reduced in order to provide private borrowers greater access to capital markets. It believes that unsubsidized private borrowers frequently make more productive use of available capital funds, and thus contribute more to economic growth. Reduced federal credit activities will also mean lower deficits in the unified budget.
The Congressional Budget Office (CBO) estimates that the Administration's credit proposals would succeed in holding the annual amount of new direct and guaranteed lending for the next five years below the 1983 level. This would represent a reduction of almost $150 billion from what would otherwise occur under current polices. New direct loan obligations would remain relatively constant at approximately $38 billion over the next five years, while primary guarantee commitments would be allowed to rise gradually from $86 billion in 1984 to $96 billion in 1988.
This document is available in its entirety in PDF.