Pages

Jump to bottom

1 comment

1 watching you tiny alien kittens are  Mon, Nov 26, 2012 10:10:55am

If Congress does nothing and allows all of the "fiscal tightening" measures to go into effect here is what the CBO says will result...

According to CBO’s projections, if all of that fiscal tightening occurs, real (inflation-adjusted) gross domestic product (GDP) will drop by 0.5 percent in 2013 (as measured by the change from the fourth quarter of 2012 to the fourth quarter of 2013)—reflecting a decline in the first half of the year and renewed growth at a modest pace later in the year. That contraction of the economy will cause employment to decline and the unemployment rate to rise to 9.1 percent in the fourth quarter of 2013.
[Link: www.cbo.gov...]

So yes, recession and higher unemployment. I'm still looking at the full PDF version trying to figure out how they conclude that the GDP would begin to rebound towards positive growth again within the year. That seems overly optimistic to me considering how slow growth already is. Still they conclude that under this scenario it would take until 2018 for unemployment to drop back to 5.5%.

However if Obama were to get what he originally said he wanted...

Extending all expiring tax provisions other than the cut in the payroll tax and indexing the AMT for inflation—except for allowing the expiration of lower tax rates on income above $250,000 for couples and $200,000 for single taxpayers—would boost real GDP by about 1¼ percent by the end of 2013. That effect is nearly as large as the effect of making all of those changes in law and extending the lower tax rates on higher incomes as well (which CBO estimates to be a little less than 1½ percent, as noted above), primarily because the budgetary impact would be nearly as large (and secondarily because the extension of lower tax rates on higher incomes would have a relatively small effect on output per dollar of budgetary cost).

Note that if you read that CBO report carefully it is actually suggesting two scenarios that achieve the highest growth of the GDP. The first is a two year extension of the Bush tax cuts, except for the top bracket, and a like delay of any fiscal tightening measures resulting in 2.7% growth. The second is the same but also extends the payroll tax cut and emergency unemployment benefits resulting in 3.4% growth.

Also note that they state that allowing taxes to rise on the top bracket would only knock less than .025 off of the maximum possible GDP growth. So much for the "Hurting the Job Creators" mantra, the numbers simply don't back that claim up.

However as far as the budget is concerned allowing the top bracket cut to expire does almost as much good by itself as all the other proposed fiscal measures do when combined. How is that possible? It is because the Government gets that money without any corresponding increased costs to itself. No large surge of unemployment benefits, no reduced tax base due to recession, no increase in welfare and medical benefits to the poor, that's how.


This page has been archived.
Comments are closed.

Jump to top

Create a PageThis is the LGF Pages posting bookmarklet. To use it, drag this button to your browser's bookmark bar, and title it 'LGF Pages' (or whatever you like). Then browse to a site you want to post, select some text on the page to use for a quote, click the bookmarklet, and the Pages posting window will appear with the title, text, and any embedded video or audio files already filled in, ready to go.
Or... you can just click this button to open the Pages posting window right away.
Last updated: 2016-01-01 10:29 am PST
LGF User's Guide RSS Feeds Tweet

Help support Little Green Footballs!

Subscribe now for ad-free access!Register and sign in to a free LGF account before subscribing, and your ad-free access will be automatically enabled.

Recent PagesClick to refresh
Donald Trump’s Cuba Problem Comes With Big Risks Today, Trump’s campaign manager made a television appearance in which she appears to have made the story quite a bit worse for her boss. The Washington Post noted: Donald Trump’s campaign manager denied Thursday that one of the GOP ...
Thanos
9 minutes ago
Views: 39 • Comments: 0 • Rating: 0
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0
OneRepublic - A.I. (Audio) Ft. Peter Gabriel Preorder OneRepublic’s new album, ‘Oh My My,’ out October 7th, and get ‘A.I.,’ ‘Wherever I Go,’ ‘Kids’ and ‘Future Looks Good’ instantly: smarturl.itListen to the complete OneRepublic playlist on Spotify: smarturl.it Music video by OneRepublic performing A.I.. (C) 2016 ...
Thanos
24 minutes ago
Views: 33 • Comments: 0 • Rating: 0
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0
GOP Blocks Probes Into Trump-Russia Ties Suspicion is mounting about Donald Trump’s ties to Russian officials and business interests, as well as possible links between his campaign and the Russian hacking of U.S. political organizations. But GOP leaders have refused to support efforts by Democrats ...
Thanos
4 hours, 55 minutes ago
Views: 145 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Comments: 0
: 0
Jewish Leaders React to Rodrigo Duterte Holocaust Remarks Jewish leaders have reacted angrily after Philippine President Rodrigo Duterte compared his anti-drug campaign to the Holocaust. The comment - wrongly citing numbers killed by the Nazis - was inhumane and deeply offensive, they said. Mr Duterte said he ...
Thanos
6 hours, 50 minutes ago
Views: 128 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Comments: 0
: 0
Rosetta Spacecraft Collides With Comet, as Planned After more than a decade of roaming tirelessly across the solar system, the comet-watching Rosetta spacecraft has gone to its eternal rest at last. In a deliberate act of self-sacrifice, Rosetta plowed into the surface of comet 67P at ...
Thanos
7 hours, 1 minute ago
Views: 98 • Comments: 0 • Rating: 0
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0
What Meerkat Murder Tells Us About Human Violence Here are the 30 mammal species most likely to kill their own kind. #1 might surprise you. https://t.co/qdprrwBjvl pic.twitter.com/vB0e6NjdbZ — Ed Yong (@edyong209) September 28, 2016 ReplyReply w/ QuoteImages A new study of violent behavior in more than 1,000 ...
Thanos
7 hours, 47 minutes ago
Views: 114 • Comments: 1 • Rating: 0
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0
SPLC: United States Crime Rates Still at Historic Lows MONTGOMERY, Ala. – The following statement regarding the FBI’s Uniform Crime Reporting program’s annual Crime in the United States report, released September 26, 2016, is from Lisa Graybill, deputy legal director at the Southern Poverty Law Center. "The FBI’s ...
Birth Control Works
23 hours, 31 minutes ago
Views: 114 • Comments: 0 • Rating: 0
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0
Advice She Didn’t Ask For"Save us from fascism but don't be a bitch about it." Thanks for weighing in, but it looks like Hillary Clinton is doing just fine without the help of body language experts. Watch Full Frontal with Samantha Bee next week ...
Thanos
1 day, 3 hours ago
Views: 184 • Comments: 0 • Rating: 1
Tweets: 0 • Share to Facebook
Shares: 1
Comments: 0
: 1
Actual Scientific Polls Show Big Win for Hillary Clinton in First Debate The consensus is in: viewers overwhelmingly thought Hillary Clinton was the winner of the first presidential debate. Four polls — from CNN/ORC, Politico/Morning Consult, NBC/SurveyMonkey, and Public Policy Polling — all showed that respondents felt Clinton bested Donald Trump ...
Thanos
1 day, 3 hours ago
Views: 413 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Comments: 0
: 0
Senate Update: Races for the Senate and White House Are Moving in Near Lockstep The senate races are so important this cycle, even if Hillary wins she faces an impossible task and we face 4-8 more years of pure obstructionism from the GOP if they hang on to the Senate. Democrats are still ...
Thanos
1 day, 4 hours ago
Views: 288 • Comments: 0 • Rating: 1
Tweets: 0 • Share to Facebook
Shares: 0
Comments: 0
: 0