    [Analytical Perspectives]
    [Dimensions of the Budget]
    [19. Comparison of Actual to Estimated Totals]
    [From the U.S. Government Printing Office, www.gpo.gov]

      In successive budgets, the Administration publishes several estimates
    of the surplus or deficit for a particular fiscal year. Initially, the
    year appears as an outyear projection at the end of the budget horizon.
    In each subsequent budget, the year advances in the estimating horizon
    until it becomes the ``budget year.'' One year later, the year becomes
    the ``current year'' then in progress, and the following year, it
    becomes the just-completed ``actual year.''
      The budget is legally required to compare budget year estimates of
    receipts and outlays with the subsequent actual receipts and outlays for
    that year.\1\ Part I of this chapter meets that requirement by comparing
    the actual results for 2003 with the current services estimates shown in
    the 2003 Budget published in February 2002.
    ---------------------------------------------------------------------------
      \1\ These requirements, for receipts and ``uncontrollable outlays,''
    are in 31 USC 1105(a)(18) through (20).
    ---------------------------------------------------------------------------
      Part II of the chapter presents a broader comparison of estimates and
    actual outcomes. This part first discusses the historical record of
    budget year estimates versus actual results over the last two decades.
    Second, it broadens the focus to estimates made for each year of the
    budget horizon, extending four years beyond the budget year. This
    broader focus shows that the growth in differences between estimates and
    the eventual actual results grows as the estimates extend further into
    the future.

           PART I:  COMPARISON OF ACTUAL TO ESTIMATED TOTALS FOR 2003

      This part of the chapter compares the actual receipts, outlays, and
    deficit for 2003 with the current services estimates \2\ shown in the
    2003 Budget published in February 2002. This part also presents a more
    detailed comparison for mandatory and related programs, and reconciles
    the actual receipts, outlays, and deficit totals shown here with the
    figures for 2003 previously published by the Department of the Treasury.
    ---------------------------------------------------------------------------
      \2\ The current services concept is discussed in Chapter 24, ``Current
    Services Estimates.'' For mandatory programs and receipts the February
    2002 current services estimate is based on laws then in place. For
    discretionary programs the current services estimate is based on the
    current year estimates adjusted for inflation.
    ---------------------------------------------------------------------------

                                    Receipts

      Receipts in 2003 were $1,782 billion, which is $339 billion less than
    the current services estimate of $2,121 billion in the 2003 Budget. As
    shown in Table 19-1, this shortfall was the net effect of legislative
    and administrative changes; economic conditions that differed from what
    had been expected; and technical factors that resulted in different
    collection patterns and effective tax rates than had been assumed.

               Table 19-1.  COMPARISON OF ACTUAL 2003 RECEIPTS WITH THE INITIAL CURRENT SERVICES ESTIMATES
                                                (in billions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                             Enacted
                                               February   legislation/    Different  Technical     Net
                                                 2002    administrative   economic    factors     change     Actual
                                               estimate      actions     conditions
    ----------------------------------------------------------------------------------------------------------------
    Individual income taxes.................     1,009           -33           -51       -131       -215        794
    Corporation income taxes................       208           -40             7        -44        -76        132
    Social insurance and retirement receipts       750            -2           -13        -23        -37        713
    Excise taxes............................        69   ..............          *         -2         -2         68
    Estate and gift taxes...................        24   ..............         -*         -2         -2         22
    Customs duties..........................        21            -1             *         -*         -1         20
    Miscellaneous receipts..................        40   ..............         -6          *         -6         35
                                             -----------------------------------------------------------------------
      Total.................................     2,121           -76           -62       -201       -339      1,782
    ----------------------------------------------------------------------------------------------------------------
    * $500 million or less.

      Policy differences. The Job Creation and Worker Assistance Act, which
    was signed by President Bush on March 9, 2002, reduced 2003 receipts by
    $36 billion. Enactment of the Jobs and Growth Tax Relief Reconciliation
    Act in May 2003 reduced 2003 receipts by an additional $36 billion (see
    Chapter 16, ``Federal Receipts'' for a description of this Act). Other
    legislative and administrative changes reduced 2003 receipts by an
    additional $4 billion.

    [[Page 330]]

      Economic differences. Differences between the economic assumptions
    upon which the current services estimates were based and actual economic
    performance accounted for a reduction in 2003 receipts of $62 billion.
    Lower-than-anticipated wages and salaries and other sources of personal
    income were in large part responsible for the reductions in individual
    income taxes and social insurance and retirement receipts of $51 billion
    and $13 billion, respectively. Lower-than-expected interest rates, which
    affect deposits of earnings by the Federal Reserve, were in large part
    responsible for the $6 billion reduction in miscellaneous receipts below
    the February 2002 estimate. These reductions were only partially offset
    by a $7 billion increase in corporation income taxes, attributable to
    higher-than-expected corporate profits.
      Technical reestimates. Technical factors reduced 2003 receipts a net
    $201 billion below the February 2002 current services estimate. This net
    reduction was primarily attributable to lower-than-anticipated
    collections of individual and corporation income taxes of $131 billion
    and $44 billion, respectively. Lower-than-anticipated collections of
    social insurance and retirement receipts reduced 2003 receipts relative
    to the February 2002 estimate by an additional $23 billion. Lower
    effective tax rates on wages and salaries than estimated in February
    2002 were primarily responsible for the net reductions in collections of
    individual income taxes and social insurance and retirement receipts.
    Different collection patterns and effective tax rates than assumed in
    February 2002 were primarily responsible for the lower-than-anticipated
    collections of corporation income taxes.

                                     Outlays

      Outlays for 2003 were $2,158 billion, $78 billion more than the $2,080
    billion current services estimate in the 2003 Budget (February 2002).
      Table 19-2 distributes the $78 billion net increase in outlays among
    discretionary and mandatory programs and net interest. \3\ The table
    also makes rough estimates according to three reasons for the changes:
    policy; economic conditions; and technical estimating differences, a
    residual.
    ---------------------------------------------------------------------------
      \3\ Discretionary programs are controlled by annual appropriations,
    while mandatory programs are generally controlled by authorizing
    legislation. Mandatory programs are mostly formula benefit or
    entitlement programs with permanent spending authority that depend on
    eligibility criteria, benefit levels, and other factors.
    ---------------------------------------------------------------------------

               Table 19-2.  COMPARISON OF ACTUAL 2003 OUTLAYS WITH THE INITIAL CURRENT SERVICES ESTIMATES
                                                  (outlays in billions)
    ----------------------------------------------------------------------------------------------------------------
                                                         Current                   Changes
                                                         Services -----------------------------------------
                                                          (Feb.                                     Total     Actual
                                                          2002)      Policy  Economic  Technical   changes
    ----------------------------------------------------------------------------------------------------------------
    Discretionary:
      Defense.........................................        351        70  ........        -16        54       405
      Nondefense......................................        409        18  ........         -6        12       421
                                                       -------------------------------------------------------------
        Subtotal, discretionary.......................        759        88  ........        -22        66       826
    Mandatory:
      Social Security.................................        472  ........        -*         -1        -1       470
      Other programs..................................        674        40         *         -6        35       708
                                                       -------------------------------------------------------------
        Subtotal, mandatory...........................      1,145        40        -*         -7        34     1,179
    Net interest......................................        175         4       -28          3       -22       153
                                                       -------------------------------------------------------------
        Total outlays.................................      2,080       132       -29        -25        78     2,158
    ----------------------------------------------------------------------------------------------------------------
    * $500 million or less.

      Policy changes are the result of legislative actions that change
    spending levels, primarily through higher or lower appropriations, which
    may reflect legislative responses to changed economic conditions, or
    changes in authorizing legislation. For 2003, policy changes increased
    outlays an estimated $132 billion relative to the initial current
    services estimates.
      Policy changes increased discretionary outlays by $88 billion. Defense
    discretionary outlays increased by $70 billion and nondefense
    discretionary outlays increased by $18 billion, largely due to the 2003
    Emergency Wartime Supplemental Appropriations Act. Policy changes
    increased mandatory outlays by $40 billion above current law. Farm
    income subsidies increased by $13 billion due to the Farm Security and
    Rural Investment Act of 2002 and the Consolidated Appropriations Act of
    2003. Unemployment compensation outlays increased by another $13 billion
    due to the Job Creation and Worker Assistance Act of 2002 and the
    subsequent extensions of temporary extended unemployment compensation.
    The increase also includes outlays for temporary state fiscal relief
    totaling $9 billion, $4 billion for Medicaid and $5 billion for state
    fiscal assistance grants, resulting from enactment of the Jobs and
    Growth Tax Relief Reconciliation Act of 2003. The remaining $5 billion
    increase includes a $2 billion reduction in offsetting receipts from
    delaying spectrum auctions. Debt service costs increased by $4 billion
    due to outlay and revenue policy changes.

    [[Page 331]]

      Economic conditions that differed from those forecast in February 2002
    resulted in a net decrease in outlays of $29 billion. This decrease
    almost entirely consists of a $28 billion decrease in net interest due
    to lower-than-expected interest rates.
      Technical estimating differences and other changes resulted in a net
    decrease in outlays of $25 billion. Technical changes result from
    changes in such factors as the number of beneficiaries for entitlement
    programs, crop conditions, or other factors not associated with policy
    changes or economic conditions. Outlays for discretionary programs
    decreased an estimated $22 billion, largely due to slower-than-expected
    defense outlays. Outlays for mandatory programs decreased an estimated
    $7 billion. This reflects lower-than-anticipated outlays for Federal
    employee retirement and farm income subsidies, and downward subsidy
    reestimate of Export-Import Bank loans, partly offset by higher-than-
    anticipated outlays for Medicare. Net interest outlays increased by $3
    billion largely due to higher deficits in 2002 and 2003 stemming from
    technical factors compared to the February 2002 estimates.

                                 Surplus/Deficit

      The preceding two sections discussed the differences between the
    initial current services estimates and the actual amounts of Federal
    Government receipts and outlays for 2003. This section combines these
    effects to show the net impact of these differences.
      As shown in Table 19-3, the initial 2003 current services estimate was
    a surplus of $41 billion. The actual result was a deficit of $375
    billion, a swing of $416 billion. Receipts were $339 billion less than
    the initial estimate and outlays were $78 billion more. The table shows
    the distribution of the changes according to the categories in the
    preceding two sections.

              Table 19-3.  COMPARISON OF THE ACTUAL 2003 DEFICIT WITH THE INITIAL CURRENT SERVICES ESTIMATE
                                                      (in billions)
    ----------------------------------------------------------------------------------------------------------------
                                                          Current                  Changes
                                                         Services -----------------------------------------
                                                           (Feb.                                    Total     Actual
                                                           2002)     Policy  Economic  Technical   changes
    ----------------------------------------------------------------------------------------------------------------
    Receipts...........................................     2,121       -76       -62       -201      -339     1,782
    Outlays............................................     2,080       132       -29        -25        78     2,158
                                                        ------------------------------------------------------------
      Surplus/Deficit(-)...............................        41      -207       -34       -175      -416      -375
    ----------------------------------------------------------------------------------------------------------------
    Note: Surplus changes are receipts minus outlays. For these changes, a minus indicates a decrease in the
      surplus.

      The net effect of policy changes for receipts and outlays reduced the
    surplus by $207 billion. Economic conditions that differed from the
    initial assumptions in February 2002 accounted for an estimated $34
    billion decrease in the surplus. Technical factors further reduced the
    surplus by an estimated $175 billion.

    Comparison of the Actual and Estimated Outlays for Mandatory and Related
                                Programs for 2003

      This section compares the original 2003 outlay estimates for mandatory
    and related programs under current law in the 2003 Budget (February
    2002) with the actual outlays. Major examples of these programs include
    Social Security and Medicare benefits for the elderly, agricultural
    price support payments to farmers, and deposit insurance for banks and
    thrift institutions. This category also includes net interest outlays
    and undistributed offsetting receipts.
      A number of factors may cause differences between the amounts
    estimated in the budget and the actual mandatory outlays. For example,
    legislation may change benefit rates or coverage; the actual number of
    beneficiaries may differ from the number estimated; or economic
    conditions (such as inflation or interest rates) may differ from what
    was assumed in making the original estimates.

    [[Page 332]]

      Table 19-4.  COMPARISON OF ACTUAL AND ESTIMATED OUTLAYS FOR MANDATORY AND RELATED PROGRAMS UNDER CURRENT LAW
                                                (in billions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                              2003
                                                                           -----------------------------------------
                                                                              Feb. 2002
                                                                              estimate       Actual        Change
    ----------------------------------------------------------------------------------------------------------------
    Mandatory outlays:
      Human resources programs:
        Education, training, employment, and social services..............         8            11             3
        Health:
          Medicaid........................................................       159           161             2
          Other...........................................................        17            15            -2
                                                                           -----------------------------------------
          Total health....................................................       175           175            -*
        Medicare..........................................................       229           246            17
        Income security:
          Retirement and disability.......................................        93            91            -2
          Unemployment compensation.......................................        41            54            14
          Food and nutrition assistance...................................        36            37             2
          Other...........................................................       100           100            -*
                                                                           -----------------------------------------
            Total, income security........................................       270           283            13
        Social security...................................................       472           470            -1
        Veterans benefits and services:
          Income security for veterans....................................        28            29             2
          Other...........................................................         3             2            -*
                                                                           -----------------------------------------
            Total veterans benefits and services..........................        30            31             1
                                                                           -----------------------------------------
            Total mandatory human resources programs......................     1,185         1,217            33
                                                                           -----------------------------------------
      Other functions:
        Agriculture.......................................................        12            17             5
        International.....................................................        -3            -7            -4
        Deposit insurance.................................................         1            -1            -3
        Other functions...................................................         8             7            -1
                                                                           -----------------------------------------
            Total, other functions........................................        19            16            -3
                                                                           -----------------------------------------
      Undistributed offsetting receipts:
        Employer share, employee retirement...............................       -50           -49             1
        Rents and royalties on the outer continental shelf................        -3            -5            -2
        Other undistributed offsetting receipts...........................        -5      ............         5
                                                                           -----------------------------------------
            Total undistributed offsetting receipts.......................       -58           -54             3
                                                                           -----------------------------------------
          Total, mandatory................................................     1,145         1,179            34
                                                                           -----------------------------------------
    Net interest:
      Interest on Treasury debt securities (gross)........................       348           318           -29
      Interest received by trust funds....................................      -161          -156             5
      Other interest......................................................       -11            -9             2
                                                                           -----------------------------------------
            Total net interest............................................       175           153           -22
                                                                           -----------------------------------------
            Total outlays for mandatory and net interest..................     1,320         1,332            11
    ----------------------------------------------------------------------------------------------------------------
    * $500 million or less.

      Table 19-4 shows the differences between the actual outlays for these
    programs in 2003 and the amounts originally estimated in the 2003
    Budget, based on laws in effect at that time. Actual outlays for
    mandatory spending and net interest in 2003 were $1,332 billion, which
    was $11 billion more than the initial estimate of $1,320 billion, based
    on existing law in February 2002.
      Actual outlays for mandatory human resources programs were $1,217
    billion, $33 billion more than originally estimated. This increase was
    the net effect of legislative action, differences between actual and
    assumed economic conditions, differences between the anticipated and
    actual number of beneficiaries, and other technical differences.
      Outlays for other functions were $3 billion less than originally
    estimated. Undistributed offsetting receipts were $3 billion less than
    expected, largely due to lower spectrum auction receipts.

    [[Page 333]]

      Outlays for net interest were $153 billion, or $22 billion less than
    the original estimate. This decrease was the net effect of changes in
    interest rates from those initially assumed, changes in borrowing
    requirements due to differences in surpluses, and technical factors.

      Reconciliation of Differences with Amounts Published by Treasury for
                                      2003

      Table 19-5 provides a reconciliation of the receipts, outlays, and
    deficit totals published by the Department of the Treasury in the
    September 2003 Monthly Treasury Statement and those published in this
    budget. The Department of the Treasury made adjustments to the estimates
    for the Combined Statement of Receipts, Outlays, and Balances, which
    decreased receipts by $202 million and increased outlays by $370
    million. Additional adjustments for this budget increased receipts and
    outlays by $227 million and $731 million, respectively. The major
    changes were inclusion of the transactions of the United Mine Workers of
    America benefit funds and adjustments of the exchange stabilization fund
    principally to exclude gains and losses in the valuation of foreign
    currencies held in the fund.

                                  Table 19-5.  RECONCILIATION OF FINAL AMOUNTS FOR 2003
                                                (in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                         Receipts         Outlays         Deficit
    ----------------------------------------------------------------------------------------------------------------
    Totals published by Treasury (September MTS)....................       1,782,317       2,156,536        -374,219
      Miscellaneous Treasury adjustments............................            -202             370            -572
                                                                     -----------------------------------------------
    Totals published by Treasury in U.S. Government Annual Report...       1,782,115       2,156,906        -374,791

      United Mine Workers of America benefit funds..................             190             190  ..............
      Exchange stabilization fund...................................  ..............             484            -484
      Other.........................................................              37              57             -20
                                                                     -----------------------------------------------

      Total adjustments, net........................................             227             731            -504

    Totals in the budget............................................       1,782,342       2,157,637        -375,295

    MEMORANDUM:
      Total change since year-end statement.........................              25           1,101          -1,076
    ----------------------------------------------------------------------------------------------------------------

      PART II:  HISTORICAL COMPARISON OF ACTUAL TO ESTIMATED SURPLUSES OR
                                    DEFICITS

      This part of the chapter compares estimated surpluses or deficits to
    actual outcomes over the last two decades. The first section compares
    the estimate for the budget year of each budget with the subsequent
    actual result. The second section extends the comparison to the
    estimated surpluses or deficits for each year of the budget window--that
    is, for the current year through the fourth year following the budget
    year. This part concludes with some observations on the historical
    record of estimates of the surplus or deficit versus the subsequent
    actual outcomes.

    Historical Comparison of Actual to Estimated Results for the Budget Year

      Table 19-6 compares the estimated and actual surpluses or deficits
    since the deficit estimated for 1982 in the 1982 Budget. The estimated
    surpluses or deficits here for each budget include the Administration's
    policy proposals. Therefore, the original deficit estimate for 2003
    differs from that shown in table 19-3, which is on a current services
    basis. Earlier comparisons of actual and estimated surpluses or deficits
    were on a policy basis, so for consistency the figures in Table 19-6 are
    on this basis.
      On average, the estimates for the budget year underestimated actual
    deficits (or overestimated actual surpluses) by $26 billion over the 22-
    year period. Policy outcomes that differed from the original proposals
    increased the deficit by an average of $24 billion. Differences between
    economic assumptions and actual economic performance increased the
    deficit an average of $12 billion. Differences due to these two factors
    were partly offset by technical revisions, which reduced the deficit an
    average of $9 billion.
      The relatively small average difference between actual and estimated
    deficits conceals a wide variation in the differences from budget to
    budget. The differences ranged from a $389 billion underestimate of the
    deficit to a $190 billion overestimate. The $389 billion underestimate,
    in the 2002 Budget, was due largely to receipt shortfalls associated
    with the 2001 recession and associated weak stock market performance.
    About a quarter of the underestimate was due to increased spending for
    recovery from the September 11, 2001 terrorist attacks, homeland
    security measures, and the war against terror, along with lower receipts
    due to the March 2002 economic stimulus act. The $190 billion
    overestimate of the deficit in the 1998 Budget stemmed largely from
    stronger-than-expected economic growth and a surge in individual income
    tax collections beyond that accounted for by economic factors.

    [[Page 334]]

      Because the average deficit difference obscures the degree of under-
    and overestimation in the historical data, a more appropriate statistic
    to measure the magnitude of the differences is the average absolute
    difference. This statistic measures the difference without regard to
    whether it was an under- or overestimate. Since 1982, the average
    absolute difference has been $100 billion.
      Another measure of variability is the standard deviation. This
    statistic measures the dispersion of the data around the average value.
    The standard deviation of the deficit differences since 1982 is $139
    billion. Like the average absolute difference, this measure illustrates
    the high degree of variation in the difference between estimates and
    actual deficits.
      The large variability in errors in estimates of the surplus or deficit
    for the budget year underscores the inherent uncertainties in estimating
    the future path of the Federal budget. Some estimating errors are
    unavoidable, because of differences between the President's original
    budget proposals and the legislation that Congress actually enacts.
    Occasionally such differences are huge, such as additional
    appropriations for disaster recovery, homeland security, and war efforts
    in response to the terrorist attacks of September 11, 2001, which were
    obviously not envisioned in the President's budget submitted the
    previous February. Even aside from differences in policy outcomes,
    errors in budget estimates can arise from new economic developments,
    unexpected changes in program costs, shifts in taxpayer behavior, and
    other factors. The budget impact of changes in economic assumptions is
    discussed further in Chapter 11 of this volume, ``Economic
    Assumptions.''

                    Table 19-6.  COMPARISON OF ACTUAL AND ESTIMATED SURPLUSES OR DEFICITS SINCE 1982
                                                (In billions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                  Surplus          Differences due to
                                                     or    ----------------------------------
                                                 deficit (-
                                                     )                                           Total      Actual
                       Budget                    estimated    Enacted    Economic  Technical  difference  surplus or
                                                    for     legislation   factors   factors               deficit(-)
                                                   budget
                                                  year \1\
    ----------------------------------------------------------------------------------------------------------------
    1982.......................................        -62          15        -70        -11        -66        -128
    1983.......................................       -107         -12        -67        -22       -101        -208
    1984.......................................       -203         -21         38          -         17        -185
    1985.......................................       -195         -12        -17         12        -17        -212
    1986.......................................       -180          -8        -27         -7        -41        -221
    1987.......................................       -144           2        -16          8         -6        -150
    1988.......................................       -111          -9        -19        -16        -44        -155
    1989.......................................       -130         -22         10        -11        -23        -152
    1990.......................................        -91         -21        -31        -79       -131        -221
    1991.......................................        -63          21        -85       -143       -206        -269
    1992.......................................       -281         -36        -21         48        -10        -290
    1993.......................................       -350          -8        -13        115         95        -255
    1994.......................................       -264          -8         16         52         61        -203
    1995.......................................       -165         -18          1         18          1        -164
    1996.......................................       -197           6         53         30         89        -107
    1997.......................................       -140           1         -4        121        118         -22
    1998.......................................       -121          -9         48        151        190          69
    1999.......................................         10         -22         56         82        116         126
    2000.......................................        117         -42         88         74        119         236
    2001.......................................        184        -129         32         40        -57         127
    2002.......................................        231        -103       -201        -85       -389        -158
    2003.......................................        -80         -86        -34       -175       -295        -375

    Average....................................  .........         -24        -12          9        -26   ..........
    Absolute average \2\.......................  .........          28         43         59        100   ..........
    Standard deviation.........................  .........          37         61         80        139   ..........
    ----------------------------------------------------------------------------------------------------------------
    \1\ Surplus or deficit estimate includes the effect of the budget's policy proposals.

    \2\ Absolute average is the average without regard to sign.

        Five-Year Comparison of Actual to Estimated Surpluses or Deficits

      The substantial differences between actual surpluses or deficits and
    the budget year estimates made less than two years earlier raises
    questions about the degree of variability for estimates of years beyond
    the budget year. Table 19-7 shows the summary statistics for the
    differences for the current year (CY), budget year (BY), and the four
    succeeding years (BY+1 through BY+4). These are the years that are
    required to be estimated in the budget by the Budget Enforcement Act of
    1990.
      On average, the budget estimates since 1982 overstated the deficit in
    the current year by $13 billion, but underestimated the deficit in the
    budget year by $26 billion. The budget estimates understated the deficit
    in the years following, by amounts growing from $50 billion for BY+1 to
    $60 billion for BY+4. While these results suggest a tendency to
    underestimate deficits toward the end of the budget horizon, the
    averages are not statistically different from zero in light of the high
    variation in the data.
      The average absolute difference between estimated and actual deficits
    grows dramatically over the six years from CY through BY+4, from $48
    billion in the

    [[Page 335]]

    current year to $100 billion for the budget year, to $218 billion for
    BY+4. While under- and overestimates of the deficit have historically
    tended to average out, the absolute size of the under- or overestimates
    grows as the estimates extend further into the future. The standard
    deviation of the deficit differences shows the same pattern. The
    standard deviation grows from $62 billion for current year estimates to
    $139 billion for the budget year estimates and continues to increase
    steadily as the estimates extend further out, reaching $250 billion for
    BY+4.
      The estimates of variability in the difference between estimated and
    actual deficits can be used to construct a range of uncertainty around a
    given set of estimates. Statistically, if these differences are normally
    distributed, the actual deficit will be within a range of two standard
    deviations above or below the estimate about 90% of the time. Chart 19-1
    shows this range of uncertainty applied to the deficit estimates in this
    budget. This chart illustrates that unforeseen economic developments,
    policy outcomes, or other factors could give rise to large swings in the
    deficit estimates.

    Table 19-7.  DIFFERENCES BETWEEN ESTIMATED AND ACTUAL SURPLUSES OR DEFICITS FOR FIVE-YEAR BUDGET ESTIMATES SINCE
                                                          1982
                                                (In billions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                     Estimate for budget year plus
                                                               Current   Budget  -----------------------------------
                             Measure                            year      year      One      Two     Three     Four
                                                              estimate  estimate    year    years    years    years
                                                                                   (BY+1)   (BY+2)   (BY+3)   (BY+4)
    ----------------------------------------------------------------------------------------------------------------
    Average difference \1\..................................        13       -26      -50      -56      -68      -60
    Average absolute difference \2\.........................        48       100      145      178      203      218
    Standard deviation......................................        62       139      201      219      234      250
    ----------------------------------------------------------------------------------------------------------------
    \1\ A positive figure represents an underestimate of the surplus or an overestimate of the deficit.
    \2\ Average absolute difference is the average difference without regard to sign.