It's easy to read the latest budget outlook from the Congressional Budget Office as further proof that the United States really needs to get serious about dealing with the national debt. But if that's all that lawmakers take away, they will have missed a big point. The CBO is not in the business of telling Congress what to do. But it is in the business of showing Congress how what it chooses to do may affect the country's economic future. One of the big lessons in the latest CBO analysis is that lawmakers should tread carefully when deciding how to tamp down debt so as not to unduly upend economic growth.
The CBO believes economic growth in the next few years will be modest. That's assuming three big things: the Bush-era tax cuts would expire, resulting in bigger tax bills; spending cuts would be enacted as per the recently passed Budget Control Act; and stimulus measures -- such as extended unemployment benefits -- will have run out. If all that comes to pass, the agency estimates that growth in 2013 would be between 1.5% and 3.5% lower than would otherwise be the case.
Economic growth in the second quarter was slightly weaker than previously estimated.
That's not surprising. Given the already slow economic recovery and the fact that interest rates can't fall much farther, "reductions in government spending or an increase in taxes ... will slow economic growth and reduce employment," CBO director Douglas Elmendorf said in a meeting with reporters. At the same time, letting the debt grow unbridled can also hurt future economic growth. So what's a partisan-driven policymaker to do? Don't be a slave to ideology and apply a little finesse to your task.
"It's possible to structure deficit reduction in a way that does not have as large a dampening effect on output and employment in the near term while still achieving significant deficit reduction over the decade and the longer term," Elmendorf said. "That amounts principally to having the policy changes take place later." That is, policymakers could support near-term economic growth by increasing spending (or at least not cutting it) and lowering taxes (or at least not raising them).
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What to do, what to do?...
Weak growth. Monster debt. Which to tackle first?
Aug 25 2011 - As a forecast by the Congressional Budget Office shows, both threats to the economy linger. The good news is that the solution doesn't need to be either-or.
It's easy to read the latest budget outlook from the Congressional Budget Office as further proof that the United States really needs to get serious about dealing with the national debt. But if that's all that lawmakers take away, they will have missed a big point. The CBO is not in the business of telling Congress what to do. But it is in the business of showing Congress how what it chooses to do may affect the country's economic future. One of the big lessons in the latest CBO analysis is that lawmakers should tread carefully when deciding how to tamp down debt so as not to unduly upend economic growth.
The CBO believes economic growth in the next few years will be modest. That's assuming three big things: the Bush-era tax cuts would expire, resulting in bigger tax bills; spending cuts would be enacted as per the recently passed Budget Control Act; and stimulus measures -- such as extended unemployment benefits -- will have run out. If all that comes to pass, the agency estimates that growth in 2013 would be between 1.5% and 3.5% lower than would otherwise be the case.
Economic growth in the second quarter was slightly weaker than previously estimated.
That's not surprising. Given the already slow economic recovery and the fact that interest rates can't fall much farther, "reductions in government spending or an increase in taxes ... will slow economic growth and reduce employment," CBO director Douglas Elmendorf said in a meeting with reporters. At the same time, letting the debt grow unbridled can also hurt future economic growth. So what's a partisan-driven policymaker to do? Don't be a slave to ideology and apply a little finesse to your task.
"It's possible to structure deficit reduction in a way that does not have as large a dampening effect on output and employment in the near term while still achieving significant deficit reduction over the decade and the longer term," Elmendorf said. "That amounts principally to having the policy changes take place later." That is, policymakers could support near-term economic growth by increasing spending (or at least not cutting it) and lowering taxes (or at least not raising them).
MORE
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
If we're lucky, things will suck for only a decade.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
If we're lucky, things will suck for only a decade.
Yep, We are going to have to learn to be satisfied with less.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
If we were to open the shale-oil-nuclear power-clean coal
explore-extract-refine-deliver-construct-etc... with-out the threats of higher taxes etc... to go with it we could be back to the days of 5% UE with very small deficits as we had in 2007
Thats what it will take
Rick Perry is perfect
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
If we're lucky, things will suck for only a decade.
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
Very true.
it wont stop the lies about it though
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
If we're lucky, things will suck for only a decade.
Mr clean if we allow things to move forward as they are it will take a generation to undo this mess
Things are gonna suck for pretty much the next decade, And there is no quick fix by any politician.
Very true.
it wont stop the lies about it though
Quit f,in over investors. Quit adding regulation, quit threatening business with more taxes and it turns around in a relatively short time.
You guys are just lining up future excuses.
Very true.
it wont stop the lies about it though
Quit f,in over investors. Quit adding regulation, quit threatening business with more taxes and it turns around in a relatively short time.
You guys are just lining up future excuses.
They could totally eliminate every regulation and business tax on the books and that would do nothing to change the fact that foreign workers will work for a very small fraction of their American counterparts.
Very true.
it wont stop the lies about it though
Quit f,in over investors. Quit adding regulation, quit threatening business with more taxes and it turns around in a relatively short time.
You guys are just lining up future excuses.
They could totally eliminate every regulation and business tax on the books and that would do nothing to change the fact that foreign workers will work for a very small fraction of their American counterparts.
Quit f,in over investors. Quit adding regulation, quit threatening business with more taxes and it turns around in a relatively short time.
You guys are just lining up future excuses.
They could totally eliminate every regulation and business tax on the books and that would do nothing to change the fact that foreign workers will work for a very small fraction of their American counterparts.
And corporations are now lobbying to be able to bring foreign profits back into the USA tax free.
