Remember Those Big Federal Savings?
It seemed like a good idea at the time. But a move to more short-term borrowing by the Treasury Dept. won't save the $16.4 billion originally expected through 1998, the Clinton Administration now says. The White House budget office said on May 25 that eliminating the sale of seven-year notes, cutting 30-year bond offerings in half, and increasing borrowings of two- and three-year notes would save just $10.8 billion. The Congressional Budget Office puts the savings at a mere $6.4 billion. There will be no savings at all if short rates take off, as some private economists expect.