Administration reports $127 billion budget surplus

The Bush administration today said the total budget surplus for fiscal 2001 was $127 billion, more than $30 billion less than predicted just weeks ago and less than half the estimate made when the administration released its budget this spring.

Expectations for the surplus plummeted as the economy stalled this year and worsened further in the wake of the Sept. 11 terrorist attacks.

"Circumstances have changed radically," Office of Management and Budget Director Mitch Daniels acknowledged in a statement today. "We must make sure that this is not the last surplus by limiting additional spending to purposes directly related to the nation's battle against terrorism."

The fiscal 2000 surplus was $237 billion, making the 2001 surplus the second largest on record.

The April OMB budget estimate for the 2001 surplus was $281 billion. The administration's mid-session review surplus forecast late this summer was for $158 billion. At that time, the administration forecast receipts of $2.013 trillion and outlays of $1.855 trillion. Actual 2001 receipts were $1.99 trillion and outlays were $1.863 trillion.

The administration also announced it had paid down $90 billion in publicly held debt during fiscal 2001. The $127 billion surplus includes a $12 billion reduction in anticipated spectrum auction recoveries.

For comparison, in its most recent budget analysis, released Sept. 26, CBO projected the fiscal 2001 budget surplus would be $121 billion, down from the $153 billion it had projected in the mid-session review that came out in late August. In May, CBO had expected a far larger surplus of $275 billion.