New information from the Congressional Budget Office allows an update of the fiscal outlook. While deficits are manageable in the short run, the debt-GDP ratio is already high relative to historical norms. Under “current policy,” we project the ratio will rise to 96 percent by 2027 and 154...
Bad framing of fiscal policy contributes to a poor allocation of money collected and spent. Almost all real growth in government goes automatically to health, retirement and tax subsidies, while spending on children, the work force, and infrastructure are scheduled for decline as a share of...
Long-term budget projections do not have to be right to be useful. Even when they are wrong, forecasts give valuable information about the long-term direction of key sectors of the budget, economy, and population. A variety of models now shows important demographic shifts—such as the aging of...
We usually think of lame ducks as politicians who have lost influence to their successors, but the next president could enter office with his or her influence already lost to his or her predecessors. The growing revenues that accompany economic growth traditionally provide a way for government...
Former CBO director Doug Elmendorf recently argued that Congress should account for macroeconomic feedback when scoring major tax and spending policies. In this brief, Donald Marron agrees, arguing that CBO and JCT can implement such dynamic scoring in an objective, nonpartisan manner. Dynamic...
Student loans, mortgage guarantees, and other lending programs create special challenges for federal budgeting. Under official budget rules, these programs are projected to bring in $200 billion over the next decade. Under an alternative, favored by many analysts, they appear to lose $100...
Policy analysts have long debated how best to budget for student loans, mortgage guarantees, and other federal lending programs. Under official budget rules, these programs appear highly profitable; under an alternative, favored by many analysts, they appear to lose money. That discrepancy...
This document describes the basics of Pay for Success (PFS), its advantages and disadvantages compared to traditional government financing, how a PFS-ready sector can be created, how to identify evidence-based PFS ready programs, the Five Steps to Pay for Success, and next steps in the PFS...
While political leaders remain tied up in discussions of government shutdowns and debt ceiling increases, we focus on the medium- and long-term budget outlook, where more serious challenges lie. With the passage of the American Taxpayer Relief Act, the imposition of the sequester, and changes in...
The Fiscal Outlook at the Beginning of the Trump Administration
New information from the Congressional Budget Office allows an update of the fiscal outlook. While deficits are manageable in the short run, the debt-GDP ratio is already high relative to historical norms. Under “current policy,” we project the ratio will rise to 96 percent by 2027 and 154...
How Budget Offices Should Reframe Our Long-Term Budget Problems
Bad framing of fiscal policy contributes to a poor allocation of money collected and spent. Almost all real growth in government goes automatically to health, retirement and tax subsidies, while spending on children, the work force, and infrastructure are scheduled for decline as a share of...
The Reliability of Long-Term Budget Projections
Long-term budget projections do not have to be right to be useful. Even when they are wrong, forecasts give valuable information about the long-term direction of key sectors of the budget, economy, and population. A variety of models now shows important demographic shifts—such as the aging of...
A Lame Duck President in 2017?
We usually think of lame ducks as politicians who have lost influence to their successors, but the next president could enter office with his or her influence already lost to his or her predecessors. The growing revenues that accompany economic growth traditionally provide a way for government...
Thoughts on Dynamic Scoring of Fiscal Policies
Former CBO director Doug Elmendorf recently argued that Congress should account for macroeconomic feedback when scoring major tax and spending policies. In this brief, Donald Marron agrees, arguing that CBO and JCT can implement such dynamic scoring in an objective, nonpartisan manner. Dynamic...
Tax Reform and Small Business
Eric Toder testified about tax reform and small business, before the House Committee on Small Business on April 15, 2015.
The $300 Billion Question: How Should We Budget for Federal Lending Programs?
Student loans, mortgage guarantees, and other lending programs create special challenges for federal budgeting. Under official budget rules, these programs are projected to bring in $200 billion over the next decade. Under an alternative, favored by many analysts, they appear to lose $100...
A Better Way to Budget for Federal Lending Programs
Policy analysts have long debated how best to budget for student loans, mortgage guarantees, and other federal lending programs. Under official budget rules, these programs appear highly profitable; under an alternative, favored by many analysts, they appear to lose money. That discrepancy...
Sharing Risk: How Pay for Success Can Make Government More Efficient
This document describes the basics of Pay for Success (PFS), its advantages and disadvantages compared to traditional government financing, how a PFS-ready sector can be created, how to identify evidence-based PFS ready programs, the Five Steps to Pay for Success, and next steps in the PFS...
Fiscal Myopia
While political leaders remain tied up in discussions of government shutdowns and debt ceiling increases, we focus on the medium- and long-term budget outlook, where more serious challenges lie. With the passage of the American Taxpayer Relief Act, the imposition of the sequester, and changes in...