On jobs, Congress is probably not going to do anything. On deficits, however, expect Congress to act. It's an unfortunate situation. Without congressional action on jobs, the unemployment rate is expected to stay around 9% -- or even get worse -- until 2014 or so. But on deficits, if Congres doesn't act the problem will basically take care of itself. As the CBO explained recently, under current law, annual deficits are on track to shrink from where they are today (8% of GDP) to about 1% of GDP by 2015. That's because Congress' of the past created policies with expiration dates and controls that were designed to prevent them from being perpetual drains on the budget. For example, the 2003 Bush tax cuts were passed under special rules that make it easier for the majority party to overcome minority opposition for controversial legislation, but, in exchange, require the legislation to expire after 10 years. Other examples include the Alternative Minimum Tax and the formula the government uses to reimburse doctors under Medicare, both of which are "patched" by Congress year after year so that they don't end up raising taxes too much or reducing doctor pay.
The problem, however, is that doing nothing and letting these sunsets and budget controls do their job is that it would mean more of the burden would get shifted to people and interests groups with money and political influence. For that reason, Congress is not likely to keep their hands off.Read Full Article
The Congressional Budget Office has released their "score" for the financial reform bill (a.k.a. the Restoring American Financial Stability Act of 2010), and it looks like more good news for the Dems. Reuters reports:Read Full Article
After days of delay, the Congressional Budget Office has released their full scoring (.pdf) of the Reconciliation Act of 2010 (H.R.4872) that is designed to bridge the gap between the more conservative Senate version of the health care bill and the progressive House version. The reconciliation bill is designed to strike a balance between the two and, based on the numbers alone, it appears to achieve that, and it even supercedes the oher bills in a couple areas.Read Full Article
Our long national nightmare is finally over. The Congressional Budget Office's score of the amended Senate health care bill has finally leaked. According to the CBO, the final package will cost $940 billion and will reduce the deficit by $130 billion over the first ten years and possibly $1.2 trillion over the next ten years.Read Full Article