WASHINGTON -- The U.S. Treasury yesterday reported that the government ran a $290.2 billion budget deficit in fiscal 1992, fulfilling the expectations of many analysts, who predict an even higher deficit next year.
Kathleen Stephansen, an economist with Donaldson, Lufkin & Jenrette Securities Corp., forecast a $312 billion deficit in fiscal 1993. "Our deficit estimate does not include any fiscal package put forth by either presidential candidate," she said in her company's weekly market commentary.
The fiscal 1992 federal budget deficit set a record, beating out last year's $270 billion mark.
The 1992 deficit is still roughly $44 billion less than the Bush administration's most recent forecast, a $334 billion gap projected in July. That estimate was pared from an original deficit forecast of $399 billion.
The actual 1992 deficit fell significantly short of those predictions because, among other things, the government spent far less on deposit insurance than was predicted, economists said.
Susan Hering, an economist with Salomon Brothers, said the government spent less than $5 billion on deposit insurance in 1992, compared with the $80 billion it expected to spend on failed savings and loans and banks.
The government planned to spend about $40 billion on the thrift bailout, but ended up taking in almost $9 billion -- an actual surplus -- on bailout activities because a congressional funding delay has halted work by the Resolution Trust Corp., Hering said.
She predicted that the fiscal 1993 deficit will fall somewhere in the $290 billion-to-$300 billion range because she does not expect the federal government's structural deficit to change much and the RTC to spend more than about $5 billion next year.
"I think it will stay around $290 billion for a couple of years," Hering said.
Next year's Congress is unlikely to authorize new RTC funding until March, at the earliest, and it will take the RTC at least two months after that to resume its work, she said. "That would leave only four or five months left in the  fiscal year for the RTC to spend money."
Stephansen said she pared her forecast for the corporation's spending in fiscal 1993 to $30 billion from $60 billion because of the current funding delay, which started in April.
"Congress' next likely date to grant the RTC borrowing authority is February 1993, curtailing the chances for massive RTC spending for [fiscal 1993]," she said in her weekly commentary. "RTC funding remains the great uncertainty."
Louis Crandall, an economist with R.H. Wrightson & Associates, said two other factors were instrumental in the lower-than-expected deficit in fiscal 1992.
He said government receipts during the fiscal year were higher than what the administration expected because corporate profits were stronger than anticipated, among other things.
Government outlays were also less than expected, but it is less clear as to why that occurred, Crandall said. He said the most likely explanation is that the administration overestimated costs for Social Security, health and human services, and defense spending.
Nonetheless, Crandall is not optimistic that the government will reduce the deficit in the next few years simply by spurring growth.
"We're not going to grow out of the deficit," he said. "We're going to need significant fiscal restructuring."
Also in yesterday's report, the Treasury said government outlays for fiscal 1992 were $1.382 trillion, while receipts were $1.092 trillion. In September, the government ran a $5.4 billion surplus, compared with a $6.89 billion deficit last September, the report says.
Interest payments on public debt in September totaled $17.5 billion, bringing the total cost for fiscal 1992 to $292.3 billion, according to the report.
Also, individual tax receipts in fiscal 1992 were up 1.9%, compared with 1991, and corporate tax receipts were up 2.2% compared to last year, according to the report.