Deficit Hits Lowest Level Since 1974

President Clinton on Wednesday forecast a smaller-than-expected $37 billion federal deficit for 1997, the lowest shortfall in 23 years. He also said he might use his line-item veto power for the first time.

The president said he would meet with his staff and Cabinet officers between now and Saturday to decide what items, if any, should be deleted from the landmark tax-cut and budget-balancing bills he signed the day before.

Clinton said he would not use the powers - which give him the authority to veto certain individual items in spending and tax bills - to try to undo any provisions that were agreed to by negotiators.

The new deficit projection for fiscal 1997, which ends Sept. 30, would be the lowest federal deficit since 1974, when the government shortfall was $6 billion.