The fiscal-cliff negotiations have deteriorated into an
embarrassing travesty of competing press conferences, off-the-record remarks, closed meetings, and sound bites. The Republican side is
frustrated and flabbergasted by the absence of
a concrete proposal from the President
that can be scored by the Congressional Budget Office and then “marked
up” by Congress according to standard procedures. Vague offers of so and so many trillions of
revenue increases and spending cuts spread over a decade are just words, not
real proposals.
The last serious fiscal-cliff projections date back to the
Congressional Budget Office’s (CBO) August 2012 assessment of the budgetary
effects of various fiscal policy alternatives. In its August study, the CBO
– the “gold standard” of budget
projections -- calculated the budgetary consequences of going over the fiscal
cliff in its “baseline projection.” It then projected the budgetary effects of
alternative fiscal policies, among them, extending the Bush tax cuts and
shelving the sequestered spending cuts.
We may agree or disagree with the CBO’s projections, but
they are the most authoritative we have. President Obama has been vocal with
respect to the fiscal policies he wants,
and each item on his wish list can be scored using the CBO’s August study.
Therefore, we can approximate the five-year deficits that would result if
President Obama gets what he wants. This is not rocket science. Anyone can do
this using the CBO’s excel files.
go to forbes.com
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