The Bottom Line

April 8, 2014

Each year, the Government Accountability Office (GAO) produces a report covering opportunities to reduce fragmentation, overlap, and duplication within the federal government. Its 2014 report, released today, is the fourth report in this annual series, which originated from an amendment authored by Senator Tom Coburn (R-OK) as part of the 2010 debt ceiling legislation.

April 8, 2014

This blog has corrected the amount of Medicare savings in the budget. It previously said $50 billion, but that included the cost of repealing the Medicare sequester.

April 7, 2014

The House Ways and Means Committee is holding a hearing Tuesday to consider whether to permanently extend the business tax breaks that expired at the end of 2013. In particular, the hearing will focus on the provisions extended by Camp's Tax Reform Act of 2014; the two largest of which are the research and experimentation (R&E) tax credit and Section 179 expensing.

April 7, 2014

Although the primary purpose of a budget resolution is to set spending and revenue levels to govern the consideration of legislation by Congress, it can also contain provisions regarding budget rules and scoring procedures for legislation. The budget resolution reported by the House Budget Committee contains two particularly significant provisions dealing with accounting for costs of credit programs and general revenue transfers to the highway trust fund. While these provisions are technical and arcane, they could have a significant impact on legislation if they are adopted.

April 7, 2014

House Budget Committee Chairman Paul Ryan's budget would substantially reduce deficits and debt over ten years, but one remaining question is what the budget would look like over the long term. The same day the budget was released, CBO produced an analysis of the budget that runs through 2040.

April 4, 2014

Update: The House passed the Pro-Growth Budgeting Act by a 224-182 vote. Also, CBO posted a letter to Chairman Paul Ryan examining the feasibility of conducting the analyses required by some of the proposed amendments to the Pro-Growth Budgeting Act.

April 4, 2014

The Senate Finance Committee met yesterday to consider the fate of the 50-plus tax breaks that expired last year known as "tax extenders." Unfortunately, they chose to extend almost all of them for two years by adding the costs of the tax cuts to the national debt.

April 3, 2014

Much of the focus in House Budget Committee chair Paul Ryan's (R-WI) budget inevitably falls on the changes it it would make to mandatory spending, of which there are many. However, much of the budget's deficit reduction comes through further cuts (beyond the sequester currently in place) to non-defense discretionary spending.

April 2, 2014

One of the recurring themes of recent budget debates has been partisan differences over the appropriate level of revenues, with Republicans rejecting any increased revenue proposed by Democrats in budget negotiations. But in separate releases yesterday, Senate Democrats proposed reducing revenues below the levels proposed by House Republicans. While this may seem like an April Fool’s joke, the numbers don’t lie. 

April 2, 2014

Update: Two days later, the Senate Finance Committee amended the legislation to extend nearly all of the provisions that had been allowed to expire. See our blog post for analysis of the final package.

April 2, 2014

A new feature of House Budget Committee Chairman Paul Ryan's (R-WI) FY 2015 budget is assumption of a "fiscal dividend," which reflects the economic impact of the deficit reduction in the budget. Policy changes have both direct and indirect budgetary impacts. Directly, increases in revenue or cuts in spending lower the deficit. Indirectly, deficit reduction can produce economic effects which, in turn, contribute to additional deficit reduction.

April 2, 2014
A Guide to Congress' Gimmicks

Elected officials in Congress often hide new spending or tax cuts by taking advantage of the rules followed by the Congressional Budget Office (CBO).

April 1, 2014

With the medium-term economic and budget outlook weaker than last year, House Budget Chairman Paul Ryan's (R-WI) goal of reaching a balanced budget by the end of the decade has become much more difficult. Despite this, Ryan's FY2015 budget does achieve balance in 2024, just as last year's budget did in 2023.

April 1, 2014

House Budget Committee Chairman Paul Ryan (R-WI) released his FY 2015 budget today, outlining a series of changes that promise to reduce the debt as a share of the economy and balance the budget by 2024. Our initial analysis of the budget took a look at the impact it will have on the deficit and debt. This post examines spending and revenue levels in the Ryan budget. 

April 1, 2014

This morning, House Budget Committee Chairman Paul Ryan released his FY 2015 budget proposal, "The Path to Prosperity." The budget reaches balance in 2024 by cutting over $5.1 trillion of spending over ten years (relative to a "PAYGO baseline"), and it assumes an additional $175 billion in deficit reduction from a "fiscal dividend"

March 31, 2014
Senate-Passed Doc Fix Includes Multiple Serious Medicare Reforms

The Senate voted 64-35 today to approve a 12-month temporary “doc fix” to push back the impending nearly 25 percent cut to Medicare physician payments dictated by the Sustainable Growth Rate (SGR) formula.

March 31, 2014

In a letter to the Ways & Means Committee, CRFB President Maya MacGuineas states that Chairman Dave Camp's tax reform draft made the right choices in choosing how to deal with the tax extenders and potential revenue from economic growth. The full letter can be seen here.

March 31, 2014

Last week, we made the case that an expired provision known as bonus depreciation be treated separately from the other tax extenders, both because it was intended as temporary stimulus and because the small cost of a one-year extension masks the huge cost of making it permanent. Specifically, extending bonus depreciation for one year would cost about $5 billion (before interest) while extending it year after year would cost $300 billion.

March 28, 2014

A recent Department of Defense white paper takes a close look at what reforms to the military retirement system might look like, even though the Commission on Military Compensation and Retirement Modernization will not make its recommendations in 2015.

March 28, 2014

Senate Budget Committee Chair Patty Murray (D-WA) introduced legislation yesterday to cut taxes for low- and middle-income workers in a few different ways. The legislation is intended to be fully paid for, and although there is no official CBO or JCT score, it appears to accomplish that goal.

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