September 27, 2016

bbixby's blog

Fiscal Responsibility Does Not Require Eliminating the Debt

In an interview with Bob Woodward of the Washington Post, Republican presidential front-runner Donald Trump estimated last week that he could pay off the nation’s $19 trillion debt within eight years.

Reality Check From the Congressional Budget Office

On the campaign trail, voters are hearing promises of big tax cuts from the Republican presidential candidates and of big spending increases from the Democrats.

Meanwhile, back in Washington last week, the nonpartisan Congressional Budget Office (CBO) released a new set of projections for the next 10 years that casts serious doubt on how realistic (or responsible) those campaign promises are.

According to CBO's projections, here are some sobering fiscal facts that will confront the next president:

On Fiscal Promises, Trump Sounds Like a Typical Politician

Donald Trump is often described as an “unconventional” candidate. When it comes to the federal budget, however, his campaign promises are entirely too conventional.

Some candidates deny the necessity of reforming popular entitlement programs such as Medicare and Social Security.

Some candidates propose enormous tax cuts without credible proposals to cut enough spending to prevent this from worsening the debt.

Time to Heed Warnings From Medicare and Social Security Trustees

The message from the Social Security and Medicare trustees last week could not have been more blunt: the two programs’ long-term costs “are not sustainable with currently scheduled financing and will require legislative action to avoid disruptive consequences for beneficiaries and taxpayers.”

Five Ways the New Democrat Coalition Can Pursue Its Fiscal Agenda

The New Democrat Coalition, a group of 46 House members who describe themselves as the "pro-growth, fiscally responsible wing of the Democratic Party,"

Rule Change Could Start a Critical Conversation on Social Security

A looming crisis is facing Social Security’s Disability Insurance (DI) program: Unless Congress takes action, the DI trust fund will run out next year and beneficiaries will suffer an across-the-board cut of 19 percent.

Some advocates suggest that a “simple fix” would be for Congress to shore up the DI trust fund by reallocating a portion of Social Security’s payroll tax revenue from the Old Age and Survivors Insurance program (OASI). But this approach would ignore the fact that OASI has growing problems of its own. 

Tax Extender Debate Is a Case Study in Fiscal Irresponsibility

Lawmakers are now focusing on extending a series of tax provisions mainly benefiting businesses for one year after a much larger deal that would have added hundreds of billions of dollars to the deficit collapsed last week.

The False Choice Between Deficit Reduction and Jobs

An interesting poll this month in the Des Moines Register shows that Democrats and Republicans have very different opinions on the relative importance of the federal deficit versus unemployment and jobs as campaign issues. It might be, however, that the two sides just have different ways of expressing concern over the same issue: our nation’s economic future.

Administration’s Updated Projections Show Little Change in Big Fiscal Picture

With the economy continuing its slow recovery, the administration’s Mid-Session Review budget projections released on Friday show little change in the overall outlook.

Bad Omens in This Year's Retreat From Hard Choices

Following last year’s bipartisan budget agreement, this was supposed to be the year of a harmless fiscal ceasefire on Capitol Hill. Unfortunately, the ceasefire is becoming a retreat for fiscal responsibility.