October 20, 2014

IT'S OFFICIAL: 1998 BUDGET DEFICIT WAS $29 BILLION: DECLARATION OF BUDGET SURPLUS GIVES FALSE IMPRESSION

WASHINGTON--It is now official: without counting the Social Security surplus, the federal government recorded a $29 billion budget deficit in 1998. The Concord Coalition, a bipartisan group advocating fiscal responsibility, today asserted that the claims of a budget surplus for fiscal year 1998 give the false impression that there is no longer a need for continued fiscal discipline.

"The Social Security program is legally and officially off-budget, but politicians from both political parties are using its surplus to make people believe the budget problems have been solved," said Concord Coalition Executive Director Martha Phillips. "The government's on-budget accounts remain in deficit and the long-term problems with Social Security and Medicare have yet to be solved. Given these facts, we should not be celebrating a so-called 'era of budget surpluses.'"

The numbers provided today by the Treasury Department show that the federal government's on-budget accounts were $29 billion in the red during fiscal year 1998. The Social Security program recorded a $99 billion surplus during that time. Only by combining the on-budget and off-budget numbers into the "unified budget" figure can it be claimed that there was a fiscal year surplus in 1998.

"All Americans should be concerned about the breakdown in fiscal discipline that occurred in the closing days of the last Congressional session," said Phillips. "Before anyone proposes a tax cut or new spending, they should remember that the so-called surplus is already earmarked for Social Security. Using it for anything else is like a family using its kids' college fund to pay for groceries."

The Concord Coalition is a nonpartisan, grassroots organization seeking to eliminate federal budget deficits and ensure that Social Security, Medicare, and Medicaid are secure for all generations. Concord was founded in 1992 by the late former Sen. Paul Tsongas (D-Mass.), former Sen. Warren Rudman (R-N.H.), and former Secretary of Commerce Peter Peterson. Former Sen. Sam Nunn (D-Ga.) was named a co-chair of the Concord Coalition in 1997.