The Bottom Line

June 27, 2012

Today, CRFB released its newest paper outlining options for controlling federal health care costs. Federal health spending is projected to grow at a high rate and threaten the fiscal health of our economy. According to CBO, net federal health care spending will rise from $750 billion in 2012 to $1.6 trillion in 2022, about 4.9 percent and 6.7 percent of GDP respectively. Over the longer term, it will rise even further--possibly to 9 percent of GDP by 2035 and 11 percent by 2050.

June 27, 2012

Today in The Hill, they have put together a six article package on the looming automatic cuts to the defense budget found in the sequester. These cuts, about $500 billion in total, represent half of the sequester, with the other half coming mainly from domestic discretionary cuts, but also certain mandatory cuts (most entitlements are partially or fully example).

 

The six articles include pieces from:

June 26, 2012
A Weekly Update on Budget and Fiscal Policy Developments and a Look Ahead

Decisions, Decisions – Washington waits with bated breath for the Supreme Court to rule Thursday on the constitutionality of the Affordable Care Act, the 2010 health care reform law. Not only will the decision have repercussions for politics and health care, it will also impact the federal budget significantly. In a blog last week, we laid out how the federal budget will be affected in different scenarios.

June 26, 2012

A new story is suggesting that members of Congress from both parties are trying to delay the sequester until March. This is not the first time we have heard rumors about Congress trying to move the fiscal cliff, but it still is disappointing. According to Bloomberg:

June 25, 2012

Politicos, policy wonks, and citizens will all be eagerly waiting Monday for a possible Supreme Court’s ruling on the ACA. Speculation in particular is focus on whether the individual mandate provision will survive, and what that would require from lawmakers as a response. But lost in all of the coverage is the unsustainable growth in our nation’s health care costs.

June 25, 2012

An article today in POLITICO games out four possible scenarios for how the fiscal cliff could be resolved (or not). They discuss the benefits and drawbacks of each scenario for the budget and the economy. These scenarios are:

June 25, 2012
Congress, Obama Should Tear Up "Rule of Missing Government"

In an op-ed in The Hill, former Sen. Judd Gregg (R-NH) urged Congress to begin to take action on the budget before the election. He says that rather than trying to fix all of our fiscal problems immediately, they could tackle one aspect while leaving broader solutions until after the election. He explains:

[Congress] should not try and pass a comprehensive bill addressing all the causes of our impending fiscal meltdown.  

June 22, 2012

Although a bit under the radar, the appropriations process in both the House and Senate is moving forward in a relatively timely manner (OK, maybe the standards are low). Of course, as with the past few years, disputes between the two chambers on a few issues are likely to make the process another grind-it-out affair with solutions only coming at the eleventh hour.

June 21, 2012

The Senate passed the Agriculture Reform, Food, and Jobs Act (i.e. the 2012 Farm Bill) today on a 64-35 vote. The bill included $969 billion of spending over the next ten years, mostly for nutrition programs, but makes some changes to both farm and nutrition programs that would result in $24 billion of savings relative to CBO's baseline.

June 21, 2012

On Monday, we presented a budgetary analysis of the effect the Supreme Court decision on the Affordable Care Act could have on the budget. Naturally, we relied on CBO for the estimates, but in the case of eliminating the individual mandate alone, there have been a variety of estimates about what could happen.

June 20, 2012

The Hill has an informative article today on how former chair of the Senate Budget committee, former Senator Judd Gregg (R-NH) is increasingly involved in helping sway Republicans to go for a comprehensive, bipartisan deficit reduction plan. Gregg, a member of the Simpson-Bowles Fiscal Commission, and someone who voted in favor of the plan, told The Hill that he hopes to "offer any assistance to reinvigorate" the Simpson-Bowles plan. 

June 20, 2012

We're seeing more stories, in recent days, floating the idea that policymakers might waive the entire fiscal cliff, at least temporarily. One piece in Reuters suggests that there could be a bipartisan agreement in Congress to couple a short term extention of the 2001/2003 tax cuts with a process to reform the tax code.

June 19, 2012

Former Director of the CBO Alice Rivlin and Former Sen. Pete Domenici testified today to the Senate Finance Committee on the long-term debt problem, the “fiscal cliff”, and the Domenici-Rivlin plan to address these challenges.

June 19, 2012

It is no secret to those following the news that the Supreme Court will soon make a decision on the constitutionality of pieces of the Affordable Care Act. There have been many discussions of the health policy implications of the decision, which are obviously very important. However, given the name of our organization, we'll discuss the budgetary implications of the possible rulings.

June 19, 2012
A Weekly Update on Budget and Fiscal Policy Developments and a Look Ahead

Playing Dead – Lawmakers face several deadlines in coming weeks as the number of days that Congress will be in session dwindles. Deadlines loom at the end of the month for highway funding and student loans.

June 18, 2012

The AARP has just released a helpful new paper considering the pros and cons of different options to reform Social Security. Our fiscal outlook in the long run shows that the Social Security program is in need of change, but how to best address the issue remains up for debate.

June 18, 2012
Lawmakers Haven’t Run Out of Time to Craft a Bipartisan Deficit Deal

Former Senator Judd Gregg (R-NH) has an op-ed in The Hill this morning titled, "Lawmakers Haven't Run Out of Time to Craft a Bipartisan Deficit Deal." In it, Senator Gregg points out the need for a bipartisan deal, and notes that "Simpson-Bowles, was, and is the only bipartisan, substantive vehicle that actually reduces the deficit and the debt and makes viable our tax code and programs like Social Security."

June 15, 2012

The Urban Institute has a new report on the charitable deduction (co-authored by CRFB board member Eugene Steuerle) that details some options for reforming it. The charitable deduction, which has existed since 1917, is one of the largest tax expenditures in the code. The Joint Committee on Taxation estimates that from 2011 to 2015, it will result in about $245 billion of foregone revenue.

June 15, 2012

The Medicare Payment Advisory Commission (MedPAC) has released its June 2012 report, detailing ways in which Congress can improve Medicare to better control costs and improve care.

June 14, 2012

A POLITICO article reports on an effort underway at the Senate Finance Committee to negotiate an extension of the "tax extenders," narrow temporary tax provisions that are routinely extended. The article states that an agreement on an extension "could send a signal to financial markets that the two parties can find some common ground ahead of the looming fiscal cliff facing Washington at year’s end." Here's POLITICO's description of what happened:

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