Credit Subsidy Reestimates, 1993–99

Projecting the losses and costs from federal credit assistance is difficult, and errors are inevitable. Although various incentives may exist for agencies to underestimate credit subsidies, the Congressional Budget Office's analysis of corrected reestimates does not reveal any pattern of bias in initial subsidy estimates. However, another problem was uncovered: the reestimates reported in the president's budget are in such disorder that analysts cannot rely on them. A few modest changes in current practice could reduce agencies' errors in preparing, reporting, and accounting for estimates and reestimates.