ECONOMIC

About $8 billion of the growth in expenditures from calendar 1972 tocalendar 1973 was due to the 20 percent increase in benefits from old age,survivors, and disability insurance that went into effect in October 1972,and to the liberalization of retirement and entitlement provisions at thestart of 1973. Federal purchases of goods and services rose much less lastyear than from 1971 to 1972. All of last year's rise in purchases is accountedfor by pay increases for civilian and military employees. A 5.1 percent increasein the wages and salaries of Federal employees took effect in January1973 and was followed by a 4.8 percent rise in October, but the simultaneousreduction in Federal employment (including the Armed Forces)caused Federal payrolls to rise by only 5 percent. The other half of totalFederal purchases of goods and services, purchases from the private sector,changed little after a 7 percent rise the year before.Grants-in-aid to State and local governments rose by $3j/i billion in 1973,when general revenue sharing had its first full year of operation. Thegeneral revenue sharing program, enacted in 1972, provides from $6.0to $6.5 billion of grants-in-aid each year through calendar 1976. About$10 billion has been distributed to more than 38,000 State and localgovernments from December 1972 through December 1973. About half ofthis amount had been authorized for 1972. The initial planned-use reportsfiled by most of the recipient units of government indicate that approximatelyhalf of them would spend shared revenues in such a way as torelieve tax pressures.TABLE 16.—Federal Government receipts and expenditures, national income accounts basis,calendar years 1972-73[Billions of dollars]Receipt or expenditure category1973Federal Government receipts.Personal tax and nontax paymentsCorporate profits tax accrualsIndirect business tax and nontax accruals.Contributions for social insuranceFederal Government expendituresPurchases of goods and servicesDefenseOtherTransfer paymentsGrants-in-aid to State and local governmentsNet interest paidSubsidies less current surplus of government enterprises-Surplus or deficit (—)_264.7106.974.232v 795.441.215.95.4.61 January 1973 projected percent changes applied to revised 1972 actual data.2 Preliminary.Note.—Detail may not add to totals because of rounding.Sources: Department of Commerce (Bureau of Economic Analysis) and Office of Management and Budget.76