Pages
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.

^ back to top ^

TwitterFacebook

Turn off all ads for a full year by subscribing!
Take advantage of our New Year subscription special, and save 25% off the normal subscription price! For a limited time, one-year ad-free subscriptions are just $59.95. Turn off all ads for a full year by subscribing now and save!
Read more...

► LGF Headlines

  • Loading...

► Tweeted Articles

  • Loading...

► Tweeted Pages

  • Loading...

► Top 10 Comments

  • Loading...

► Bottom Comments

  • Loading...

► Recent Comments

  • Loading...

► Tools/Info

► Tag Cloud

► Contact

You must have Javascript enabled to use the contact form.
Your email:

Subject:

Message:


Messages may be published unless you request otherwise.
Tech Note:
Using the Contact Form
LGF Pages

This button leads to the main index of LGF Pages, our user-submitted articles. You can post your own LGF Pages simply by registering a free account with us.

Create a Page

This 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: 2014-12-15 2:06 pm PST

LGF User's Guide
Recent Pages
Thanos
Nathan Freitas: The Great Firewall Inverts
There's a false Yellow Peril that the populist demagogues used to propagate to spread fear and xenophobia against Asian minorities in the US. That's the past however, and this is now. The last large scale Communist country on the planet ...

1 hour, 31 minutes ago
Views: 62 • Comments: 0
Tweets: 0 • Rating: 0
Rightwingconspirator
Open Carry Rifles & Cop Watching-Most Dangerous Convergence This Week
Watkins, a bartender by day, is the coordinator for Open Carry Tarrant County, a hybrid of the cop-watching and open carry movements. The small band of gun-toting Texans warns motorists of DUI checkpoints and speed traps. They also show ...

3 days, 4 hours ago
Views: 547 • Comments: 1
Tweets: 0 • Rating: 2
Ace-o-aces
Charles C. Johnson Is Still Looking for Investors.
4 days, 5 hours ago
Views: 668 • Comments: 7
Tweets: 9 • Rating: 8
FemNaziBitch
PEDESTAL ELITES: Why Women Supporting Rapist Friendly Judges Are the Scariest of All Americans
Why Republican women supporting rapist friendly judges are the scariest of all Americans Posted on May 20, 2014 by bonnie russell I always vote, and don't engage with those who don't. Also, my vote leans to issues, not a ...

5 days, 10 hours ago
Views: 697 • Comments: 0
Tweets: 0 • Rating: 3
Rocky-in-Connecticut
Sports Hero Gang Sign Shame
you know those professional athlete thugs- always flashing gang signs along with his baby mama. Fine example these two are. I expect Fox News and right wing blogs to have this as their cover story pronto. instagram.com Or maybe not. ...

6 days, 1 hour ago
Views: 498 • Comments: 0
Tweets: 0 • Rating: 1
Skip Intro
Republican Net Neutrality Bill Would Gut FCC’s Authority Over Broadband
The party of pure evil strikes again. Net neutrality legislation unveiled by Republicans today would gut the ability of the Federal Communications Commission to regulate the broadband industry. As expected, the bill forbids the FCC from reclassifying broadband as a ...

6 days, 9 hours ago
Views: 453 • Comments: 2
Tweets: 2 • Rating: 5
The Vicious Babushka
Wingnuts Spend MLK Day Spewing Racism & Lies
The usual [wingnut]HURR HURR MLK WAS A REPUBLICAN & ALL TEH DEMOCRATS IS TEH RACIST LIKE THERE HERO ROBERT BYRD!!!! LBJ SAID TEH N WORD!!! HURR HURR[/wingnut] #tcot MLK Day

6 days, 13 hours ago
Views: 901 • Comments: 1
Tweets: 73 • Rating: 4
Michael McBacon
Praise - Marvin Gaye
I've been on a Marvin Gaye kick lately and thought I'd post this song. Enjoy.

1 week ago
Views: 487 • Comments: 2
Tweets: 0 • Rating: 2
John Vreeland
John McAfee: ‘I know who hacked Sony Pictures - and it wasn’t North Korea’
"I can guarantee they are wrong. It has to do with a group of hackers - I will not name them - who are civil libertarians and who hate the confinement the restrictions the music industry and the movie ...

1 week ago
Views: 820 • Comments: 3
Tweets: 0 • Rating: 3
Lumberhead
Shopping While Black: The Role of Race in Retail
The researchers asked the subjects a series of questions about certain behaviors they had encountered while shopping or advertisements they had noticed, and broke out the results by race. They found that across the board, non-white Americans--and especially black ...

1 week, 1 day ago
Views: 702 • Comments: 8
Tweets: 1 • Rating: 4
 Frank says:

A prune isn't really a vegetable...
CABBAGE is a vegetable...