http://blog.heritage.org/2011/08/25/mor … a-economy/
In true 1984 double speak the WH is pointing to the CBO report on the economy as proof their policies are working! Lol! Really? Working to do what? Destroy America?? Can this country REALLY stand any more of Barack O.numb.nuts???
Hi there, Lady_Love.
Your link to the Heritage Foundation should help to spread their extreme ideology and to distract people from learning the truth about the economic improvements in this country.
I suggest that you go directly to the CBO report and skip the distorted spin of the Heritage Foundation propaganda. Learn the truth, go to the source http://www.cbo.gov/ftpdocs/123xx/doc123 … forWeb.pdf and discover the real facts for yourself. As you know, the activities of the Congressional Budget Office are controlled by statute and are beyond any official influence by the president. Quotes have been lifted directly from the CBO report:
1. Current budget deficits are actually lower than previous forecasts. “The deficit that CBO projects for 2011 is lower than what the agency estimated in March.”
2. The budget deficit in 2011 will be less than that of the previous two years.
3. The economy is still improving. “CBO expects that the recovery will continue.”
4. The GDP, while not great, is getting better every year. “CBO projects that real GDP will increase by 2.3 percent this year and by 2.7 percent next year….averaging 3.6 percent per year from 2013 through 2016.”
5. The poor employment picture is getting better. “The unemployment rate is projected to fall from 9.1 percent in the second quarter of 2011 to 8.9 percent in the fourth quarter of the year and to 8.5 percent in the fourth quarter of 2012.”
6. Inflation is being held in check. “CBO projects that it [inflation] will diminish in the second half of the year and then stay below 2.0 percent over the next several years.” “CBO projects that the inflation rate—as measured by the price index for personal consumption expenditures—will be 1.3 percent in both 2012 and 2013, down from 2.4 percent this year.”
7. Annual budget deficits are in decline. “Under CBO’s baseline projections, which generally reflect the assumption that current law will not change, deficits fall to 6.2 percent of GDP next year and 3.2 percent in 2013, and they average 1.2 percent of GDP from 2014 to 2021.” “…they also reflect the sharp increases in revenues that will occur when provisions of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the 2010 tax act) expire.”
8. The long-range deficit picture has improved since last March. “In CBO’s baseline, cumulative deficits total $3.5 trillion between 2012 and 2021,” “That estimate of deficits over the next 10 years is considerably lower than the $6.7 trillion that the agency projected in March.”
9. Permitting enacted legislation to take effect and allowing the Bush-era Tax cuts to expire will improve the future outlook. “If some of the changes specified in current law did not occur and current policies were continued instead, much larger deficits and much greater debt could result. For example, if most of the provisions in the 2010 tax act that were originally enacted in 2001, 2003, 2009, and 2010 were extended (rather than allowed to expire on December 31, 2012, as scheduled); the alternative minimum tax was indexed for inflation; and cuts to Medicare’s payment rates for physicians’ services were prevented, then annual deficits from 2012 through 2021 would average 4.3 percent of GDP, compared with 1.8 percent in CBO’s baseline projections”
10. Less spending and/or more taxes are the only solutions available to control the national debt. “The aging of the population and rising costs for health care will push federal spending up considerably as a percentage of GDP. If that higher level of spending is coupled with revenues that are held close to their average share of GDP for the past 40 years (rather than being allowed to increase, as under current law), the resulting deficits will cause federal debt to skyrocket. To prevent debt from becoming unsupportable, policymakers will have to substantially restrain the growth of spending, raise revenues significantly above their historical share of GDP, or pursue some combination of those two approaches.”
11. The current administration is not responsible for the sluggish recovery. “The slow pace of the current recovery is broadly consistent with international experience of recoveries following financial crises. In the aftermath of such a crisis, it takes time for households to rebuild their wealth and pay down their debts, for financial institutions to restore their capital bases and the supply of credit, and for businesses to regain the confidence necessary to invest in new facilities and equipment. Moreover, the boom in housing construction that preceded the financial crisis has left a substantial oversupply of vacant homes that will take time to work through.”
12. As the country recovers from a devastating recession, the future of the US economy looks good. “After 2013, according to CBO’s projections, growth in real GDP will pick up, the unemployment rate will fall more sharply, the inflation rate will eventually rise to 2.0 percent, and interest rates will climb to more-typical levels. By 2017, in the agency’s projections, real GDP will equal its potential, and the unemployment rate will be down to 5.2 percent.”
So, reading the CBO report reveals the real picture rather than the distorted one you and the Heritage Foundation would like voters to see. Except for job creation and real estate values, indicators all show things are getting better even thought we still have a long way to go. Those who will not acknowledge the obvious just prove that “There are none so blind as those who will not see. The most deluded people are those who choose to ignore what they already know.”
Have a great day, Lady, and enjoy your weekend. As for me, I have a date this weekend with a whirling Dervish named Irene.
Thank you, Quill, for your diligence.
Enjoy your date!
The methods employed by the CBO employ certain assumptions about the economy. Those assumptions can be overly optimistic. i do not disagree that the Heritage Foundation comes from a specific weltanschauung but I also do not think it is extremist. It would benefit anyone to explore more sources for information than just those that support their own world view.
It is the genuine nobility and virtue of the American worker - regardless of wage or salary - that will rescue and preserve the economy. It would be nice if the government would step aside and let that happen rather than interfere in it.
Hi UV. Thanks alot for sharing your opinions.
If you hope to minimize the significance of the CBO’s conclusions then I challenge you to find a better and more reliable source.
How accurate are CBO's economic forecasts? “The accuracy of CBO’s two-year forecasts between 1982 and 2008 paralleled that of the forecasts published by the Blue Chip consensus and the Administration over the same period (see Table 1 on page 11). The accuracy of CBO’s five-year projections also generally corresponded to that of other forecasters”
“CBO regularly evaluates the accuracy of its economic forecasts and publishes the track record. Those evaluations help guide the agency's efforts to improve its forecasts and help Members of Congress and others in their use of CBO's estimates. Historically, the accuracy of CBO's two-year forecasts and five-year projections has been very similar to the accuracy of those by the Blue Chip consensus (an average of private-sector forecasters) and the Administration.” (http://www.cbo.gov/aboutcbo/faqs.cfm)
The CBO is one of the few bi-partisan institutions in the Government where we can find accurate, unbiased data about government activities. Are CBO conclusion spun by various political interests? You bet they are, but after, not before, they are published. I agree with you. I withdraw the word “extremist” and replaced it with “rigid.”On the chance that this remark was intended to include me, please note that I have no desire to trumpet the current administration's failures or successes. Nor do I promote my opinions as superior to anyone else’s. I did not choose this source because it supported my own worldview. I choose this source because it included facts that contradicted the distorted impression of the OP and the Heritage Foundation article.
I too respect and celebrate the genuine nobility and virtues of the American worker. I am confident we will regain our prominence in the global economy when we are able to compete with the wages and quality now available in foreign labor markets.
It was great to hear from you, UV. I hope to hear from you again soon.
Oh yes thats just STELLAR! And of course Obama is not to blame for any of this... after all it would have been WORSE if he didnt do what he did... and lets not forget we are where we are because of Bush, his tax coluts for the "rich" and perscription program along with his unfunded wars destroyed the economy, even though Nobel Prize Winning Economist Paul Krugman says war is good for the economy!
I dont know Q you can report those numbers and yes mathematically some show improvement but unemployment through 2017 will still be over 8% and Obamacare has yet to kick in.
Howdy LadyLove. How are you fairing this evening?
I’m glad to see you agree with the CBO’s conclusions that those aspects of the US economy are indeed improving. Most Americans should be happy to hear the news. I am. Aren’t you?
Knowing how you prefer the truth, I expect you read the report yourself rather than relying on the Heritage Foundation spin. So you must have already known that the report did not support your original premise.
Sadly, insufficient new job creation continues to be a drag on our recovery. Economists have been predicting for more than a year that it is possible the US may never see 5% unemployment ever again. It should be obvious to every American citizen that the President of the United States can only authorize new government hires. Private sector jobs are created by businesses not Presidents.
Corporate America is currently sitting on huge capital reserves accumulated from profits and government handouts, and they are continuing to reap huge savings from having sent their manufacturing and service jobs offshore. Businesses have never had it so good. But, profits do not create jobs either. Expansion creates jobs but not for American workers. High unemployment will remain until the wages and quality of American workers can compete with foreign labor markets.
But there are some things that The President of the US can do, no matter what party he leads:
1. Support an active government role in training and retraining workers in order to maintain a stable demand for labor.
2. Encourage federal and state investments to repair and replace our aging infrastructure.
3. Curtail skyrocketing tuition costs so America’s most talented can compete with the America’s most affluent for a place in America’s world-respected colleges and universities.
Yet, everyone in Washington knows no new jobs will mean no second term for the President. So I predict we will all watch as the opposition party does whatever it takes to prevent any improvement in the jobs picture during this President’s first term. While President Obama’s opponents enjoy holding his feet to the fire over this issue, inwardly, I suspect, they are silently grateful that one of their own is not occupying the oval office right now because they don’t have any solutions either.
Oh yes, since you brought it up, let me not forget Obamacare. The Congressional Budget Office projects "Obamacare", when fully implemented, will reduce the national deficit by $210 Billion. See "CBO's Analysis of the Major Health Care Legislation Enacted in March 2010" at http://www.cbo.gov/ftpdocs/121xx/doc121 … lation.pdf . Be sure it’s dated March 2011 and not the older report dated March 2010. Also, it is important to note that since Obamacare has already be enacted, any bill that revokes this law will actually increase the projected national debt by this same $210 billion amount.
Well, LadyLove, I wish you well. I’m expect Irene to arrive in about 9 hours and there is still much to do.
Really Q? A 210 billion dollar deficit reduction? Does the CBO explain how spending 2.5 trillion on a new entitlement, equals a "savings"?
The answer to your question is in the report.
http://www.cbo.gov/ftpdocs/121xx/doc121 … lation.pdf
Your link is bad but I'm sure I can figure it out. To decrease the deficit by implementing a new entitlement program with 2.5 trillion is spending means you have to increase revenues by more than you're spending or cut spending else where. Most of Obamacare funding comes from cuts in Medicare, in other words destroying medicare as we know it, the rest comes from new taxes, not on the rich but on those that actually need care taxing things like wheel chairs and pacemakers!
The truth is i can cut the deficit by passing a law that creates 2 trillion in new taxes and uses a trillion as kindling in the White House fireplace.
We all know the CBO tries, but they are rarely correct. The problem is that the CBO is given parameters from which to draw their conclusions. When given false parameters, inaccurate numbers are the result. It is not the CBOs fault, it is the fault of the people who feed them the information. Remember the recent quote ”we cannot rate speeches”, well that is what they did here,
“The deficit that CBO projects for 2011 is lower than what the agency estimated in March.” Well if you read the report they actually contradicted themselves. “Nevertheless, this year’s shortfall—at 8.5 percent of GDP—WILL STILL BE MUCH LARGER than the average annual deficit of 2.8 percent experienced over the past 40 years. The historically high deficits of recent years have pushed debt held by the public from 40 percent of GDP at the end of 2008 to an estimated 67 percent at the end of this year. The deficit for 2011 reflects a difference between federal revenues that are much lower than average and federal outlays that are much higher than average. According to CBO’s estimates, revenues this year will amount to 15.3 percent of GDP, compared with an average of 18.0 percent over the past 40 years, and outlays will amount to 23.8 percent of GDP, well above their 40-year average of 20.8 percent.” “The future paths of federal deficits and debt will depend on the strength of the economic recovery and the fiscal policies followed by the federal government. CBO’s baseline estimates, which are predicated on the assumption that current law remains unchanged, show deficits falling marked”
There report clearly states based on assumptions. Well we know the GDP is near nothing. It was revised down the other day and based on the GDP I read, the numbers clearly indicate it was not revised downward enough, so it will revise down again.
2 “The budget deficit in 2011 will be less than that of the previous two years.” Clearly false as the deficit is already ahead of last year. 2010 deficit was 1.17 trillion dollars. 2009 was 1.4 trillion dollars. In the In its mid-year review of the federal budget, CBO projected the deficit for the fiscal year that ends Sept. 30 would be $1.3 trillion. Currently we are past the 1.3 trillion debt. My guess is we will equal or exceed the 2009 deficit.
3&4 “The economy is still improving. “CBO expects that the recovery will continue” I would love the CBO to show me just one Gov. report that’s has positive news. Even the GDP that the CBO predicted to be 2.8% is currently at 1% and will go down. There is not enough time in this fiscal year to get anywhere near 2.8%
5 “The poor employment picture is getting better. “The unemployment rate is projected to fall from 9.1 percent in the second quarter of 2011 to 8.9 percent in the fourth quarter”. This is a big time, huge time incorrect statement. Does anyone find it odd we had a net lose of jobs and yet they lowered the unemployment rate. Well I wrote about the false July job report. There were many manufacturing jobs not added to the report. There was also several instances of false adding of jobs. For example, in the auto industry, due to the Japan earthquake, US auto plants were busy. They normally have a large summer layoff. They laid off 25,000 less than they did last year. So the Obama Administration counted those 25,000 as new jobs created to keep the numbers up. How can you count someone who is working, has a job as someone who is a new hire. By next report you will see a revision in the numbers going up. But despite that, they lower the number. 9.1 is not a real or accurate number. The unemployment averaged over 400,000 new claims every week last month. New jobs added in July was only 115,000 for the entire month. You do the math.
6 “Inflation is being held in check. “CBO projects that it [inflation] will diminish in the second half of the year and then stay below 2.0 percent over the next several years.”. Again, not even close as current inflation is 3.6%.
7 Well we already showed the deficit is not in decline. As for the revenue increase, it will not happen. The tax cut Obama claimed he gave was actually a 2% cut in SS withholdings, not federal withholdings. So when the 2% break goes away, that means the revenues for SS will increase, not the revenue for the general fund.
8 The long range deficit has not improved. It will go much larger in the next 3 years as the majority of the Obamacare comes on line. Medicare, Medicaid costs will go through the roof. The rest of the CBO projections are based on assumptions of cuts and savings not in existence. Guessing on savings that have not or may not happen is poor indicators. The Super Congress is looking for 1.5 trillion in cuts. The CBO has budgeted 2.5 trillion. Hence why the numbers are inaccurate.
I am not even going to address the others for I have written many blogs on why those final statements are not quite accurate. Now I am not knocking the CBO, they have a hard job. They are getting pulled on both sides with assumptions that make no sense and only push each sides agenda. And the report here is just a little outdated so there are things that have happened that effect their projections. The real problem is how each side tries to make a mountain out of a mole hill. They twist and spin to make it conform to their agenda. Well, all they need to do is look up on the dot gov sites like I did to get the actual current numbers. We need to stop looking down the road and work on today. I can look down the road and say the Jets will win the Superbowl, but as time goes by the numbers say different. So I will need to change my position. So does the CBO. Look at real numbers. Stop projecting on hopes of something that will not happen
As always Good to hear from you Quill. I wish you well during Irene.
Hello, AV. We managed to survive Irene without sustaining any measurable damage. Thank you so much for your good wishes.
I encourage everyone to read the CBO report http://www.cbo.gov/ftpdocs/123xx/doc123 … forWeb.pdf
And don’t accept anyone’s spin on what it contains. I think we both agree what is right is more important than who is right. While some folks like to challenge the validity of CBO estimates when they run contrary to what they want to hear, they are often quick to quote a CBO report when it supports their opinions. If you rely on government facts and reliable estimates to make calculated judgements, the CBO is the ONLY level playing field in Washington. Of course, estimates are always estimates. In this case, they are legitimate, reasonable, and unbiased attempts to predict future results. The accuracy of CBO estimates are tested and tracked and the results indicate they are no better and no worse then the average results found in business forecasts coming out of blue chip corporations.
You have made this claim to me before without providing verifiable justification. The CBO is an independent agency. The director is appointed by the Speaker of the House of Representatives and by the President pro tempore of the Senate jointly after considering recommendations from the budget committees of both branches. All CBO analysis reveal the methods and data used to arrive at their conclusions. The activities of the CBO are controlled by statute and are beyond any official influence from political parties. I am not aware of any "people who feed" the CBO "parameters from which to draw their conclusions." What are the "false parameters" and "inaccurate numbers" you refer to?" Please tell me.
The report clearly states "The deficit that CBO projects for 2011 is lower than what the agency estimated in March." Sorry, AV, you are misreading the report. Your quotation is not a contradiction. It is a completely different issue and the capital letters are not found in the report.
Sorry, AV, but you are misreading the report once again. The report does NOT say based upon "assumptions" (plural). It says based upon one "assumption that current law remains unchanged." This relates to what I said above about accuracy and consistency. The CBO can not consider the possibility that laws currently on the books might be repealed in the future. In addition, you abbreviated this sentence from the report and left out a huge chunk of encouraging news. "CBO's baseline estimates, which are predicated on the assumption that current law remains unchanged, show deficits falling markedly as a percentage of GDP over the next few years-to 3.2 percent by 2013. From 2014 through 2021, deficits under current law will range between 1.0 percent and 1.6 percent of GDP" Wouldn't it be great if there were NO budget deficits in the future?
I have closely read your reply, AV. In most cases, your points are red herrings, straw men, or a disagreement over definitions. Since I reported mostly facts and few opinions, I'm happy to concede that we are both correct when viewed from our individual perspectives. You also repeated a few claims that we have previously discussed so you already have my detailed reply. You are welcome believe your own estimates of the future. For now, I'll stick with the CBO as the least biased game in town.
Hope all is well with you.
Glad all is well. Irene did a number in a few places, happy yours was not one.
My point was not to call the CBO as a false profit, but more as a misguided one. I cannot specifically point to misguided information on this report for they are not very specific. I believe they did it so on purpose, it is they that said"they cannot score speeches". In past reports, they were more specific on what they based nubers on so I would have been able to.I did read the entire report. this one was more a rah rah report than actual facts. ALL the numbers I show are actual and ALL contridict what the CBO predicts. Like a lower deficit when in reality we are already over the number they predicted. Your point is well taken on they cannot predict laws and such. But they are not even following the ones on the books. Their predictions on Obamcare is a prime example of using assumptions fed to them.If you go back to the time of the Obamacare debate, you will find 2 contridictary letters to Congress. One claims Obamacare will run surplusses, one claims deficits. They are both right, one was for Pleosi, one was for Boehner, need I say more. As I said earlier, it is not their fault, they are doing a good honest job. But if you are fed 1+1, you come out with 2, even though the reality is 1+2=3. You are free to follow the CBO predictions, but I prefer to analize actual reports and events.
For example, consumer spending will be up for the month of August and September. Mostly because of back to school, but spending will go right bacl down in October. THat goes against the CBO predictions but I bet you a bag of your favorite snack chips that My numbers are going to be closer. This will spur a small increase in Manufacturer orders, but they will fall again too. None of this will create new jobs, but in November there will be a small increase in new jobs for the holiday season, smaller than in years past, that will end in January. But they will not show up in new Unemployment numbers for they will not have worked long enough to be eligible for benifits, so the jobless numbers will not be accurate. But you can bet these normal spikes will be touted to death the the recovery is great. Count on hearing "robist" and "approach" a lot over the next 3 months. So for laughs do you want to bet on the bag of chips? Sorry I cannot do better than that, but I can only do so much on that budget busting $30 dollars Per month I get from SS disablility. Also way less than CBO reports on SS going broke.
As always Quill, I enjoy our talks most here on HP. You are a true gentleman. Shame more cannot repond with the curtiousy you do.
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