    [Analytical Perspectives]
    [Table of Contents]
    [From the U.S. Government Printing Office, www.gpo.gov]

    [[Page i]]

    .
                                                                                    TABLE OF CONTENTS

                                                                                                                                                     Page

    List of Charts and Tables..................................................................................................................          iii

    Introduction

         1.           Introduction.............................................................................................................            3

    Performance and Management Assessments

         2.           Budget and Performance Integration.......................................................................................            9

    Crosscutting Programs

         3.           Homeland Security Funding Analysis.......................................................................................           37

         4.           Strengthening Federal Statistics.........................................................................................           53

         5.           Research and Development.................................................................................................           61

         6.           Federal Investment.......................................................................................................           73

         7.           Credit and Insurance.....................................................................................................           85

         8.           Aid to State and Local Governments.......................................................................................          123

         9.           Integrating Services with Information Technology.........................................................................          173

        10.           Federal Drug Control Funding.............................................................................................          181

        11.           California-Federal Bay-Delta Program Budget Crosscut (CALFED)............................................................          183

    Economic Assumptions and Analyses

        12.           Economic Assumptions.....................................................................................................          187

        13.           Stewardship..............................................................................................................          199

        14.           National Income and Product Accounts.....................................................................................          227

    Budget Reform Proposals

        15.           Budget Reform Proposals..................................................................................................          235

    Federal Borrowing and Debt

        16.           Federal Borrowing and Debt...............................................................................................          245

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    Federal Receipts and Collections

        17.           Federal Receipts.........................................................................................................          263

        18.           User Charges and Other Collections.......................................................................................          301

        19.           Tax Expenditures.........................................................................................................          315

    Dimensions of the Budget

        20.           Comparison of Actual to Estimated Totals.................................................................................          361

        21.           Outlays to the Public, Net and Gross.....................................................................................          369

        22.           Trust Funds and Federal Funds............................................................................................          371

        23.           Off-Budget Federal Entities and Non-Budgetary Activities.................................................................          377

        24.           Federal Employment and Compensation......................................................................................          381

    Current Services Estimates

        25.           Current Services Estimates...............................................................................................          389

    The Budget System and Concepts

        26.           The Budget System and Concepts...........................................................................................          407

    Detailed Functional Table

        27.           Detailed Functional Table................................................................................................       CD-ROM

    Federal Programs by Agency and Account

        28.           Federal Programs by Agency and Account...................................................................................       CD-ROM

    Program Assessment Rating Tool (PART), Program Summaries

        29.           PART Assessments by Agency...............................................................................................       CD-ROM

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    ........................................................................

                            LIST OF CHARTS AND TABLES

      ......................................................................

    [[Page v]]

                            LIST OF CHARTS AND TABLES

                                 LIST OF CHARTS

                                                                       Page

       2-1.....  Comparison of Ratings from Initial PART to Most          13
                  Recent Reassess...................................
       4-1.....  ICSP Statistical Quality and Program Performance         54
                  Dimensions, 2006..................................
       4-2.....  Most Recent PART Summary Ratings for Statistical         56
                  Programs..........................................
       5-1.....  Scores of R&D PART Assessments.....................      62
       7-1.....  Total Mortgages, 1990-2003.........................      92
       7-2.....  Face Value of Federal Credit Outstanding...........     108
       13-1....  A Presentation of the Federal Government's and the      201
                  Nation's Financial Condition......................
       13-2....  Net Federal Liabilities............................     205
       13-3....  Health Care Cost Alternatives......................     210
       13-4....  Alternative Discretionary Spending Assumptions.....     211
       13-5....  Alternative Productivity Assumptions...............     212
       13-6....  Alternative Fertility Assumptions..................     212
       13-7....  Alternative Mortality Assumptions..................     213
       13-8....  Alternative Immigration Assumptions................     214
       17-1....  Major Provisions of the Tax Code Under the 2001,        264
                  2003 and 2004 Tax Cuts............................
       20-1....  Illustrative Range of Budget Outcomes..............     367
       26-1....  Relationship of Budget Authority to Outlays for         418
                  2006..............................................

                                 LIST OF TABLES

                                                                      Page

    Performance and Management Assessments

      Budget and Performance Integration:
       2-1.....  Program Ratings are Improving...................         12
       2-2.....  Sections of the PART............................         17
       2-3.....  The PART Questionnaire..........................         17
       2-4.....  The PART, By Category...........................         19
       2-5.....  Program Assessment and Funding Information......         20
    Crosscutting Programs

      Homeland Security Funding Analysis:
       3-1.....  Homeland Security Funding by Agency.............         38
       3-2.....  Homeland Security Funding by National Strategy           39
                  Mission Area...................................
       3-3.....  Intelligence and Warning Funding................         40
       3-4.....  Border and Transportation Security Funding......         41
       3-5.....  Domestic Counterterrorism Funding...............         43
       3-6.....  Protecting Critical Infrastructure and Key               44
                  Assets Funding.................................
       3-7.....  Defending Against Catastrophic Threats Funding..         45
       3-8.....  Emergency Preparedness and Response Funding.....         47
       3-9.....  Discretionary Fee-funded Homeland Security               49
                  Activities by Agency...........................
       3-10....  Mandatory Homeland Security Funding by Agency...         49
       3-11....  Baseline Estimates--Total Homeland Security              50
                  Funding by Agency..............................
       3-12....  Homeland Security Funding by Budget Function....         51
       3-13....  Baseline Estimates--Homeland Security Funding by         52
                  Budget Function................................
        .......  Appendix--Homeland Security Mission Funding by       CD-ROM
                  Agency and Budget Account......................

    [[Page vi]]

      Strengthening Federal Statistics:
       4-1.....  2004-2006 Budget Authority for Principal                 57
                  Statistical Agencies...........................

      Research and Development:
       5-1.....  Permanent Extension of the Research and                  65
                  Experimentation Tax Credit.....................
       5-2.....  Federal Research and Development Spending.......         66
       5-3.....  Federal Science and Technology Budget...........         68
       5-4.....  Agency Detail of Selected Interagency R&D                69
                  Efforts........................................
       5-5.....  Allocation of Federal Research Funding, 2004 and         71
                  2005...........................................

      Federal Investment:
       6-1.....  Composition of Federal Investment Outlays.......         75
       6-2.....  Federal Investment Budget Authority and Outlays:         76
                  Grant and Direct Federal Programs..............
       6-3.....  Summary of PART Ratings and Scores for Direct            79
                  Federal Investment Programs....................
       6-4.....  Net Stock of Federally Financed Physical Capital         82
       6-5.....  Net Stock of Federally Financed Research and             83
                  Development....................................
       6-6.....  Net Stock of Federally Financed Education                84
                  Capital........................................

      Credit and Insurance:

          Text Tables:
                   Summary of PART Scores........................         87
                   Percentage of Fannie Mae and Freddie Mac Loans         95
                  to First-time Minority Homebuyers
                     Compared to the Full Marketplace, 2001-2003
                  Averages.......................................
       7-1.....  Estimated Future Cost of Outstanding Federal            109
                  Credit Programs................................
       7-2.....  Reestimates of Credit Subsidies on Loans                110
                  Disbursed Between 1992-2004....................
       7-3.....  Direct Loan Subsidy Rates, Budget Authority, and        112
                  Loan Levels, 2004-2006.........................
       7-4.....  Loan Guarantee Subsidy Rates, Budget Authority,         113
                  and Loan Levels 2004-2006......................
       7-5.....  Summary of Federal Direct Loans and Loan                114
                  Guarantees.....................................
       7-6.....  Direct Loan Write-Offs and Guaranteed Loan              115
                  Terminations for Defaults......................
       7-7.....  Appropriations Acts Limitations on Credit Loan          118
                  Levels.........................................
       7-8.....  Face Value of Government-Sponsored Enterprise           120
                  Lending........................................
       7-9.....  Lending and Borrowing By Government-Sponsored           121
                  Enterprises (GSEs).............................
       7-10....  Direct Loan Transactions of the Federal              CD-ROM
                  Government.....................................
       7-11....  Guaranteed Loan Transactions of the Federal          CD-ROM
                  Government.....................................

      Aid to State and Local Governments:
       8-1.....  Federal Grant Outlays by Agency.................        123
       8-2.....  Summary of PART Ratings and Scores for Grants to        129
                  State and Local Governments....................
       8-3.....  Trends in Federal Grants to State and Local             131
                  Governments....................................
       8-4.....  Federal Grants to State and Local Governments--         134
                  Budget Authority and Outlays...................
       8-5.....  Summary of Programs by Agency, Bureau, and              142
                  Program........................................
       8-6.....  Summary of Programs by State....................        143
       8-7.....  National School Lunch Program...................        144
       8-8.....  Special Supplemental Nutrition Program for              145
                  Women, Infants, and Children (WIC).............
       8-9.....  Child and Adult Care Food Program...............        146
       8-10....  State Administrative Matching Grants for Food           147
                  Stamp Program..................................
       8-11....  Title I Grants to Local Educational Agencies....        148
       8-12....  Improving Teacher Quality State Grants..........        149
       8-13....  Special Education--Grants to States.............        150
       8-14....  Rehabilitation Services--Vocational                     151
                  Rehabilitation Grants to States................
       8-15....  State Children's Health Insurance Program.......        152
       8-16....  Grants to States for Medicaid...................        153
       8-17....  Temporary Assistance for Needy Families (TANF)--        154
                  Family Assistance Grants.......................
       8-18....  Child Support Enforcement--Federal Share of             155
                  State and Local Administrative Costs and
                  Incentives.....................................

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       8-19....  Child Care and Development Block Grant..........        156
       8-20....  Child Care and Development Fund--Mandatory......        157
       8-21....  Child Care and Development Fund--Matching.......        158
       8-22....  Head Start......................................        159
       8-23....  Foster Care--Title IV-E.........................        160
       8-24....  State Homeland Security Grant Program...........        161
       8-25....  Public Housing Operating Fund...................        162
       8-26....  Section 8 Moderate Rehabilitation...............        163
       8-27....  Housing Choice Vouchers.........................        164
       8-28....  Public Housing Capital Fund.....................        165
       8-29....  HOME Investment Partnerships Program............        166
       8-30....  Airport Improvement Program.....................        167
       8-31....  Airport Improvement Program--Emergency Response         168
                  Fund...........................................
       8-32....  Airport Improvement Program--Emergency                  169
                  Assistance to Airports.........................
       8-33....  Highway Planning and Construction...............        170
       8-34....  Federal Transit Formula Grants and Research.....        171

      Integrating Services with Information Technology:
       9-1.....  Effectiveness of Agency's IT Management and E-       CD-ROM
                  Gov Processes..................................
       9-2.....  Management Guidance.............................     CD-ROM
       9-3.....  Status of Presidential E-Government Initiatives.     CD-ROM

      Federal Drug Control Funding:
       10-1....  Federal Drug Control Funding, FY 2004-2006......        181

      California-Federal Bay-Delta Program Budget Crosscut (CALFED):

                 CALFED-Related Federal Funding Budget Crosscut          183
                  (Summary)......................................
                 CALFED 1998-2006 Budget Crosscut Methodology....     CD-ROM
                 CALFED-Related Federal Funding..................     CD-ROM
    Economic and Accounting Analyses

      Economic Assumptions and Analyses:
       12-1....  Economic Assumptions............................        191
       12-2....  Comparison of Economic Assumptions..............        193
       12-3....  Comparison of Economic Assumptions in the 2005          194
                  and 2006 Budgets...............................
       12-4....  Adjusted Structural Balance.....................        194
       12-5....  Sensitivity of the Budget to Economic                   197
                  Assumptions....................................
      Stewardship:

       13-1....  Government Assets and Liabilities...............        206
       13-2....  Long-Run Budget Projections of 2006 Budget              209
                  Policy.........................................
       13-3....  Actuarial Present Values of Benefits in Excess          217
                  of Future Taxes and Premiums...................
       13-4....  National Wealth.................................        220
       13-5....  Economic and Social Indicators..................        222

       National Income and Product Accounts:

       14-1....  Federal Transactions in the National Income and         230
                  Product Accounts, 1995-2006....................
       14-2....  Relationship of the Budget to the Federal               231
                  Sector, NIPA's.................................
       14-3....  Federal Receipts and Expenditures in the NIPA's,        232
                  Quarterly, 2004-2006...........................
    Budget Reform Proposals

      Budget Reform Proposals:
       15-1....  General Purpose Discretionary Caps and                  235
                  Adjustments....................................
       15-2....  Transportation Category for Highways and Mass           237
                  Transit Spending...............................
       15-3....  PAYGO Proposals.................................        239

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    Federal Borrowing and Debt

      Federal Borrowing and Debt:
       16-1....  Trends in Federal Debt Held by the Public.......        245
       16-2....  Federal Government Financing and Debt...........        247
       16-3....  Agency Debt.....................................        251
       16-4....  Debt Held by Government Accounts................        254
       16-5....  Federal Funds Financing and Change in Debt              256
                  Subject to Statutory Limit.....................
       16-6....  Foreign Holdings of Federal Debt................        258
    Federal Receipts and Collections

      Federal Receipts:
       17-1....  Receipts by Source-Summary......................        263
       17-2....  Effect on Receipts of Changes in the Social             263
                  Security Taxable Earnings Base.................
       17-3....  Effect of Proposals on Receipts.................        296
       17-4....  Receipts by Source..............................        299

      User Charges and Other Collections:
       18-1....  Gross Outlays, User Charges, Other Offsetting           301
                  Collections and Receipts from the Public, and
                  Net Outlays....................................
       18-2....  Total User Charge Collections...................        304
       18-3....  User Fee and Other User Charge Proposals........        305
       18-4....  Offsetting Collections and Receipts from the            310
                  Public.........................................
       18-5....  Offsetting Receipts by Type.....................        311

      Tax Expenditures:
       19-1....  Estimates of Total Income Tax Expenditures......        317
       19-2....  Estimates of Tax Expenditures for the Corporate         320
                  and Individual Income Taxes....................
       19-3....  Income Tax Expenditures Ranked by Total 2006-           324
                  2010 Projected Revenue Effects.................
       19-4....  Present Value of Selected Tax Expenditures for          326
                  Activity in Calendar Year 2004.................
       19-5....  Outlay Equivalent Estimates of Income Tax               327
                  Expenditures...................................

        Appendix:

             1.  Comparison of Current Tax Expenditures with             357
                  Those Implied by a Comprehensive Income Tax....
             2.  Comparison of Current Tax Expenditures with             358
                  Those Implied by a Comprehensive Consumption
                  Tax............................................
             3.  Revised Tax Expenditure Estimates...............        358
    Dimensions of the Budget

       Comparison of Actual to Estimated Totals:.................
       20-1....  Comparison of Actual 2004 Receipts with the             361
                  Initial Current Services Estimates.............
       20-2....  Comparison of Actual 2004 Outlays with the              362
                  Initial Current Services Estimates.............
       20-3....  Comparison of the Actual 2004 Deficit with the          363
                  Initial Current Services Estimate..............
       20-4....  Comparison of Actual and Estimated Outlays for          364
                  Mandatory and Related Programs Under Current
                  Law............................................
       20-5....  Reconciliation of Final Amounts for 2004........        365
       20-6....  Comparison of Actual and Estimated Surpluses or         366
                  Deficits Since 1982............................
       20-7....  Differences Between Estimated and Actual                366
                  Surpluses or Deficits for Five-year Budget
                  Estimates Since 1982...........................

      Outlays to Public, Net and Gross:
       21-1....  Total Outlays, Net and Gross of Offsetting              369
                  Collections and Receipts from the Public, by
                  Agency, 2004-2006..............................
       Trust Funds and Federal Funds:.......................................
       22-1....  Receipts, Outlays, and Surplus or Deficit by            371
                  Fund Group.....................................
       22-2....  Income, Outgo, and Balances of Trust Funds Group        373

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       22-3....  Relationship of Total Federal Fund and Trust            374
                  Fund Receipts to Unified Budget Receipts,
                  Fiscal Year 2004...............................
       Trust Funds and Federal Funds:.......................................
       22-4....  Income, Outgo, and Balances of Major Trust Funds     CD-ROM
       22-5....  Income, Outgo, and Balances of Selected Federal      CD-ROM
                  Funds..........................................

       Off-Budget Federal Entities and Non-Budgetary Activities:............
       23-1....  Comparison of Total, On-Budget, and Off-Budget          377
                  Transactions...................................
       Federal Employment and Compensation:.................................
       24-1....  Federal Employment in the Executive Branch......        382
       24-2....  Total Federal Employment (as measured by total          383
                  positions filled)..............................
       24-3....  Total Federal Employment (as measured by Full-          384
                  Time Equivalents)..............................
       24-4....  Personnel Compensation and Benefits.............        385
    Current Service Estimates

      Current Service Estimates:
       25-1....  Baseline Category Totals........................        390
       25-2....  Alternative Baseline Assumptions................        392
       25-3....  Summary of Economic Assumptions.................        392
       25-4....  Beneficiary Projections for Major Benefit               393
                  Programs.......................................
       25-5....  Impact of Regulations, Expiring Authorizations,         394
                  and Other Assumptions in the Baseline..........
       25-6....  Baseline Receipts by Source.....................        399
       25-7....  Change in Baseline Outlay Estimates by Category.        400
       25-8....  Current Services Outlays by Function............        401
       25-9....  Current Services Outlays by Agency..............        402
       25-10...  Current Services Budget Authority by Function...        403
       25-11...  Current Services Budget Authority by Agency.....        404
       25-12...  Current Services Budget Authority by Function,       CD-ROM
                  Category and Program...........................
       25-13...  Current Services Outlays by Function, Category       CD-ROM
                  and Program....................................

    Budget System and Concepts and Glossary

      The Budget System and Concepts:
       26-1....  Totals for the Budget and the Federal Government        411
       26-2....  Department of Defense Contributions for Tricare         423
                  Benefits Earned by Military Personnel..........

    Detailed Functional Tables

      Detailed Functional Tables:

       27-1....  Budget Authority and Outlays by Function,            CD-ROM
                  Category and Program...........................

    Federal Programs by Agency and Account

      Federal Programs by Agency and Account:

       28-1....  The Budget for Fiscal Year 2006 by Agency and        CD-ROM
                  Account........................................

    Program Rating Assessment Tool (PART), Program Summaries

      PART Summaries:

       ........  PART Summary File...............................     CD-ROM
       ........  PART Data File--Funding, Scores, and Ratings....     CD-ROM