Deficit Reductions for Fiscal Year 1990:

Compliance With the Balanced Budget and Emergency Deficit Control Act of 1985

AFMD-90-40: Published: Nov 15, 1989. Publicly Released: Nov 15, 1989.

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Pursuant to a legislative requirement, GAO determined whether the Office of Management and Budget (OMB) and the President complied with requirements of the Balanced Budget and Emergency Deficit Control Act of 1985 in their August and October 1989 reports and orders.

GAO found that: (1) the OMB reports and the President's orders substantially complied with the act's requirements for projecting a deficit and calculating sequester percentages; and (2) OMB misapplied the act's provisions for several accounts, but the errors did not materially affect its compliance. GAO believes that the act: (1) encourages short-term solutions to meet deficit reduction targets, with too little consideration given to real, long-term solutions; (2) does not address the growing deficit in the non-trust-fund side of the budget; (3) does not allow OMB final deficit projections to reflect spending authority enacted after the final OMB report; and (4) limits the ability of OMB to correct its estimates and technical mistakes. GAO supports a different approach to deficit reduction which would combine a restructured unified budget with a bipartisan agreement between Congress and the administration on a multi-year plan.

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