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To: Alohal who wrote (103791)	2/22/1999 2:41:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 176387

<--US Economy--> Surprising Surplus Alohal: Say what nonsense is this,I thought we had more important thing to worry about like that Tripp woman and Lewinsky affair.<g> ================================ U.S. Economy: Treasury Posts Jan. Surplus of $70.3 Bln (Repeat) (Repeats to add word 'billion' in 10th paragraph.) Washington, Feb. 22 (Bloomberg) -- The U.S. government posted a larger-than-expected budget surplus in January as the Treasury benefited from the strong economy and a lessened need to borrow money in financial markets. The surplus totaled $70.336 billion in January -- the fourth month of the current fiscal year -- compared with a January 1998 surplus of $25.379 billion, Treasury figures showed. Before the budget statement was released, analysts expected a surplus of $64.1 billion for last month. The U.S. government is expected to record a surplus of as much as $100 billion for the fiscal year that ends Sept. 30, after posting a $70 billion surplus last year -- the first since 1969. ''The big picture is one of building surpluses for the next several years -- at a minimum,'' said William Sullivan, an economist at Morgan Stanley Dean Witter in New York. For the fiscal year through January, the government posted a surplus of $15.348 billion compared with a deficit of $14.299 billion at the end of January 1998. ''The genesis of the improvement in the budget is the strong economy,'' Sullivan said. U.S. gross domestic product grew at a 5.6 percent pace or better in the final quarter of last year. And the current expansion is set to enter its ninth year in April with no sign it will come to end soon. That's left the Treasury flush with cash, with a record 67 percent of the population holding jobs and paying taxes, rising capital gain tax payments from the stock market, restrained federal spending, lower borrowing needs and falling interest payments on the government's $5 trillion debt. The government has been gradually reducing the amount of notes and bills it auctions to investors and retiring debt. The growing surplus has also triggered a dispute between the Clinton administration and congressional Republicans over whether to use it to cut taxes. Receipts Up, Outlays Down Tax receipts, fees and other government income rose 5.6 percent to $171.722 billion in January from $162.610 billion in January 1998. January spending fell 26.1 percent to $101.386 billion from $137.231 billion a year ago. One reason for the spending improvement last month was a fluke of the calendar. Some January spending was accelerated into December because the Jan. 3 payment date for about $30 billion in Social Security and other government payments fell on a Sunday. When outlays for December and January are considered together, the monthly average for this year was $142.721 billion; a year ago outlays averaged $145.795 billion for the two months. In financial markets, government bonds gained before the report. The Treasury's benchmark 30-year bond rose 3/8 point, pushing down its yield 3 basis points to 5.36 percent. The Treasury reports deficits in most months because many tax payments are made quarterly. Monthly surpluses usually come in January, April, June and September, which coincide with estimated tax filings. Individual income tax returns are due in mid-April. Fight Over the Surplus The fiscal 1999 budget surplus will be at least $76 billion, the largest dollar surplus in U.S. history, President Bill Clinton said in January, and the first back-to-back yearly surpluses since the 1950s. The Congressional Budget Office forecasts a surplus of $107 billion this year. Congressional Republicans and the Clinton administration agree that surplus funds generated from Social Security payroll tax receipts should be used to shore up the financially ailing retirement system. Republicans want to use the remainder -- about $109 billion over five years according to CBO -- to pay for an across the board tax cut. Clinton has proposed using the remaining surplus to shore up Medicare, help pay down the federal debt, and finance some additional spending. Washington's 29-year string of annual budget deficits peaked at $290 billion in fiscal year 1992, when the shortfall equaled about 4.7 percent of GDP. Before last year, the previous annual budget surplus, in fiscal 1969, totaled $3.2 billion. Surpluses were also reported in 1960, 1957 and 1956, of $301 million, $3.4 billion and $3.9 billion, respectively.