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

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
Linux Kernel 4.7 Released Linus Torvalds has been hard at work on an update to the Linux kernel, and now version 4.7 has been officially released. Review: 6 machine learning clouds Amazon, Microsoft, Databricks, Google, HPE, and IBM machine learning toolkits run the ...
Thanos
2 hours, 52 minutes ago
Views: 84 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Unified Patents Files Legal Challenges Against Top Three Patent Trolls of 2016 The three biggest patent trolls of this year will all soon face new legal challenges to their most valuable "inventions." Unified Patents, a company that focuses on invalidating patents through the use of the inter partes review (IPR) process, ...
Thanos
3 hours, 5 minutes ago
Views: 100 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
John Hinckley, Who Tried to Kill a President, Wins His Freedom John Hinckley Jr., 35-years after he tried to kill a president, has won his freedom. A federal judge in Washington, D.C., has granted a request for Hinckley to leave the mental hospital where he's resided for decades, to go ...
Thanos
3 hours, 38 minutes ago
Views: 96 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Andra Day - Rise Up [Audio] "Rise Up" by Andra Day, from the album 'Cheers to the Fall' available now. iTunes: smarturl.itApple Music: smarturl.itSpotify: smarturl.it Connect with Andra: andraday.comfacebook.comtwitter.cominstagram.com LYRICS: Rise Up(Andra Day and Jennifer Decilveo) You’re broken down and tiredOf living life on a ...
Thanos
1 day ago
Views: 151 • Comments: 0 • Rating: 0
Tweets: 2 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Duo Behind Planned Parenthood Video Cleared District Judge Brock Thomas dismissed the tampering with government records charge against 27-year-old David Daleiden and 63-year-old Sandra Merritt upon the request of the Harris County prosecutor's office. Defense attorneys said the pair never should have been indicted. If ...
Thanos
1 day, 1 hour ago
Views: 163 • Comments: 1 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Roll Up Your Sleeves: Red Cross Says Blood Need ‘Urgent’ TUESDAY, July 26, 2016 (HealthDay News) -- The American Red Cross says it has an urgent need for blood donations, with less than a five-day supply of blood on hand to help those who need it. "The Red Cross ...
Thanos
1 day, 1 hour ago
Views: 149 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Bernie Sanders Nominates Hillary Clinton by Acclamation Sen. Bernie Sanders, in a move to bridge the divide in the Democratic Pary, on Tuesday moved to nominate Hillary Clinton by acclamation as the Democratic nominee for president. His motion came after nearly two hours of roll call ...
Thanos
1 day, 1 hour ago
Views: 305 • Comments: 0 • Rating: 0
Tweets: 26 • Share to Facebook
Shares: 1
Likes: 1
Comments: 0
: 2
Bernie Sanders Pays Surprise Morning Visit to Kansas and Missouri Delegates Philadelphia Sen. Bernie Sanders made a surprise visit Tuesday to the Kansas and Missouri delegations at the Democratic National Convention. To thunderous applause, Sanders thanked Kansas Democrats for backing his candidacy. “Of the 50 states in the country, what ...
Thanos
1 day, 6 hours ago
Views: 283 • Comments: 0 • Rating: 0
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Euthanasia Fanatic Knifes 19 Disabled People to Death Near Tokyo The sheer rarity of this kind of violence in that modern culture, against that religious backdrop was a stark reminder to me what the nature of our true enemy is. This man cared not for religion, or gender or ...
Great White Snark
1 day, 8 hours ago
Views: 235 • Comments: 2 • Rating: 1
Tweets: 2 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0
Sarah Silverman’s Speech at the Democratic National Convention Sarah Silverman, a Bernie Sanders supporter, called for party unity during her speech at the Democratic National Convention in Philadelphia even going as far to tell the rambonxious "Bernie Or Bust" audience members they were "being ridiculous" for their ...
Thanos
1 day, 13 hours ago
Views: 273 • Comments: 0 • Rating: 1
Tweets: 1 • Share to Facebook
Shares: 0
Likes: 0
Comments: 0
: 0