The Clinton administration reported a $24.1 billion deficit for July - 6 percent less than a year ago - leaving the government on track for the first annual budget surplus in 29 years.
The July deficit, the difference between $143.8 billion in spending and $119.7 billion in receipts, put the surplus for the first 10 months of fiscal 1998 at $43 billion, compared with a deficit of $36.7 billion for the same period of fiscal 1997.Analysts expect an even bigger surplus by the end of the fiscal year on Sept. 30. If past patterns repeat, August will produce another deficit but September, when quarterly income tax payments are due from businesses and some individuals, will bring a substantial surplus.
The administration in May forecast a $39.1 billion surplus for fiscal 1998. Two months later, the Congressional Budget Office said the surplus should amount to $63 billion.
It would be the first surplus since 1969. Already it has provoked a debate in Congress over whether to increase spending, reduce taxes or retain the surplus to reduce the $5.4 trillion national debt.
Just six years ago, in 1992, the deficit hit a record $290 billion. But the tax increase of 1993, strong economic growth and years of large stock market gains have caused revenue to surge.
The July deficit would have been smaller except many government checks that normally would have been written Aug. 1 were sent July 31 because Aug. 1 fell on a Saturday.
As usual, according to Friday's report, the largest spending categories for the month were: Social Security, $36.4 billion; Department of Health and Human Services programs such as Medicare and Medicaid, $32.5 billion; the military, $24.6 billion, and interest on the public debt, $20.8 billion.