Fiscal Policy in the News
Today, Kiplinger's Personal Finance published a new interview with Fiscal Commission co-chair and CRFB board member Erskine Bowles. In a discussion with editor Janet Bodnar, Bowles argues that despite modest improvements in our country's fiscal outlook, we still face a crisis unless lawmakers deal with the long-term drivers of the national debt.
So far, reactions to the budget agreement have been mixed. As we said in our report yesterday, Understanding the Bipartisan Budget Act, the deal replaces short-term savings in sequestration with smarter, permanent savings from mandatory savings and user fees, a positive development. But it largely pushes the big decisions down the road.
The Government Accountability Office, the investigative arm of Congress, posted a short educational video explaining the national debt today. In a short time period, it explains the difference between gross debt and debt held by the public, why debt is measured as a percent of GDP, and why the long-term debt situation is troubling.
The video is a good educational resource for the basics of federal debt.
As the dust begins to clear from this month's political battle over the debt ceiling and government shutdown, there have many reports of businesses waiting to make key investments until political stability returns. Today, in a new op-ed in the Financial Times, BlackRock CEO and Chairman Larry Fink notes the partisan wrangling in Washington may been doing real, lasting damage by weakening investor confidence in the stability of our political system.
The prolonged government shutdown and debt ceiling debate are a clear indication that our government is not functioning as it should. Furloughed workers, closed national parks, and shuttered government offices are the byproduct of an unwillingness to compromise by our elected officials.
As we enter day 2 of the government shutdown, Americans across the country are already feeling the impact. With federal government offices and services shut down throughout the nation, thousands of government employees are furloughed, and there is no clear answer in sight regarding when they will return to work. But what damage will a shutdown do to the economy?
While it is incredibly disappointing that elected officials in Washington failed to avoid a government shutdown, attention is quickly turning towards raising the federal debt ceiling, which currently stands at $16.699 trillion.
Congress faces a number of looming fiscal crises this fall, and the first obstacle is just around the corner -- if lawmakers fail to pass legislation to fund federal programs before September 30, the government will shut down. Today, CRFB released a new Q&A for understanding government shutdowns and related issues, including continuing resolutions and the federal appropriations process. This new resource also provides a historical and legislative background to the upcoming fiscal