The Bottom Line

March 30, 2012
Why I'm Optimistic About Cutting the Deficit

Despite all the political gridlock and other developments that have people worried about our fiscal future, Fiscal Commission co-chair Erskine Bowles sees reason to be optimistic. In an op-ed in The Wall Street Journal, he said that the result of last year's debt ceiling brinkmanship and the resulting law (the Budget Control Act), "deficit reduction now has the upper hand."

March 29, 2012

On CNBC's Squawk Box this morning, CRFB president Maya MacGuineas talks about the National Debt Tour and other developments in fiscal policy recently, including the vote on the Simpson-Bowles alternative budget resolution.

March 29, 2012

Yesterday, 38 members of the House cast votes for the bipartisan budget resolution that is modeled after Simpson-Bowles. 22 Democrats and 16 Republicans cast a vote that would buck each of their respective parties' orthodoxy on the budget: significant tax increases for Republicans and significant entitlement cuts for Democrats.

March 29, 2012

With a large number of policies set to expire or kick in at the end of the year, with serious fiscal impacts, CRFB has released a paper laying out the optimal path for policymakers to take to avoid both a short-term economic hit from the fiscal cliff and the long-term economic consequences of not dealing with our rising debt. The solution? You guessed it -- making smart, gradual, and targeted reforms to the key drivers of our debt.

March 29, 2012

CBO has released its newest cost estimate of the Troubled Asset Relief Program (TARP), projecting it to cost $32 billion over its lifetime, which is $2 billion lower than it estimated last December. The change in the cost estimate represents a reduction in the costs of AIG and GM support netted against an increase in the cost estimate of the mortgage programs.

March 28, 2012

There have been a lot of claims circulating around about the "Simpson Bowles Alternative Budget Resolution" proposed by Congressmen Cooper, LaTourette, and others (see our initial praise for the proposal here). Some are true, some of misleading, and some are outright false. We wanted to clear up the confusion and separate fact from fiction.

March 28, 2012

Update: We have updated the table with outlays, revenue, and debt numbers for the Congressional Black Caucus plan.

March 28, 2012

As part of a continued national discussion on fiscal responsibility, The Wall Street Journal's Viewpoints Executive Breakfast Series will host Fiscal Commission Co-Chairs Erskine Bowles and Alan Simpson along with New York City Mayor Michael Bloomberg in New York City tomorrow.

March 27, 2012

In addition to the House Republican budget, a number of other budget resolutions have come out within the past few days (we will be writing about them, too). However, one budget distinguishes itself from the others: the alternative proposed by Reps. Jim Cooper (D-TN) and Steven LaTourette (R-OH). Why?

March 27, 2012
A Weekly Update on Budget and Fiscal Policy Developments and a Look Ahead

Bloom and Gloom – Washington’s famous Cherry Blossoms bloomed just ahead of the festival in their honor, and most promptly disappeared due to stormy weather in DC. Now, we can look forward to five weeks of celebrations with the namesakes mostly absent. A similar situation is playing out with the federal budget. There have been weeks of hearings, which will culminate this week as the House votes on the FY 2013 budget resolution. Yet, it is clear that there will be no budget coming out of Congress, again.

March 26, 2012

One of the more complicated aspects of Rep. Paul Ryan's (R-WI) budget is what he does with the sequester that will take effect on January 2, 2013 due to the failure of the Super Committee. From 2013-2021, the sequester is scheduled to reduce the deficit by $984 billion, with $66 billion coming in 2013. The sequester essentially has three parts: cuts to defense spending, cuts to non-defense spending, and cuts to mandatory programs, including Medicare (limited to two percent).

March 26, 2012

It is often said that tax expenditures operate as "spending through the tax code" and often obscure what the true size of government is. With the amount of tax breaks exceeding $1 trillion, that obfuscation has become increasingly important.

March 23, 2012

On this day two years ago, President Obama signed into law the Patient Protection and Affordable Care Act, the first of two pieces of legislation that would make up the full health care law. The Health Care and Education Reconciliation Act would follow a week later, making some changes to PPACA while also containing changes related to student loans.

March 23, 2012
Both Budget Plans Would Limit Medicare Growth to GDP+0.5%

With Congressman Paul Ryan's (R-WI) new budget comes an interesting piece of good news: an apparent agreement between House Republicans and President Obama on the need to hold Medicare cost growth to GDP plus 0.5 percent per beneficiary in the long-term.

March 23, 2012
Don't Let the Perfect Be the Enemy of the Good

In a blog post entitled "Don't Let the Perfect Be the Enemy of the Good" on the Committee for Economic Development's new blog Back in the Black, Fiscal Commission co-chair Erskine Bowles states that shared sacrifice will have to be an integral part of any budget plan. Both political parties will have to give ground and citizens across the country will need to give up some things they like to get it done. As he says:

March 22, 2012

According to CBO’s report on the budget targets specified by Chairman Ryan and his staff (not a more traditional scoring of policies for whatever results those yield), Ryan’s budget targets would reduce the federal debt to 10 percent of GDP by 2050. By our calculations, these targets would transform deficits into surpluses starting in 2035.

March 22, 2012

The FY 2013 House Republican budget resolution, which has now been passed by the Budget Committee 19-18, contains a number of sweeping changes to the federal budget. And budget process is no exception.

March 21, 2012

As the House Republican budget resolution has come out and alternatives will be sure to follow, CRFB is rolling out a blog series looking at all the budget resolutions that come up and taking a closer look at the one that's out there now. In this blog, we will look at Chairman Paul Ryan's (R-WI) tax reform plan.

March 20, 2012

This morning, House Budget Committee chairman Paul Ryan (R-WI) presented the House Republican budget, one that is similar to last year's budget resolution but contains some key differences. In an op-ed in the Wall Street Journal, Rep.

March 19, 2012

CBO's most recent estimate of the insurance coverage provisions of the Affordable Care Act has sparked a debate about how CBO's estimate of ACA has changed over time.

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