Government outlays to Fannie, Freddie 24% below estimates
Obama administration officials said Friday that lower-than-expected outlays to the Troubled Asset Relief Program and government-sponsored entities resulted in a reduction in the deficit. As a percentage of gross domestic product, the national deficit fell to 8.9% for fiscal 2010, down from 10% a year earlier. Treasury Secretary Tim Geithner and Jeffrey Zients, acting director of the Office of Management and Budget said "due to careful stewardship of the emergency programs, their effect on the deficit was much smaller than previously estimated." The government only gave Fannie Mae and Freddie Mac $52.6 billion in fiscal 2010, some $16.4 billion, or 24%, less than the most-recent federal forecast. And TARP cost us just $9 billion during fiscal 2010, some 74% below the $25.9 billion that was estimated, according to the officials. Overall federal outlays were $64 billion less than a year ago. Still, the federal deficit for fiscal 2010 was $1.294 trillion, about 9% less than a year earlier, and somewhat less than estimates announced in July. The improvement in GDP was the most-rapid one-year improvement since fiscal 1987, the officials said. "By carefully managing the emergency initiatives to stop the financial panic and by accelerating our exit from those investments, we have significantly lowered the cost to taxpayers, bringing the costs of the financial rescue down by more than $240 billion this year," Geithner said. "However, we still have a long way to go to repair the damage to the economy and address the long-term deficits caused by the crisis." The administration continues to develop a budget for fiscal 2012 that stress enforcement of a "three-year, non-security discretionary spending freeze [to] continue our efforts to put the nation on firm fiscal footing," according to Zients. "The economy is recovering and we're spurring economic growth and job creation," he said. Write to Jason Philyaw.