CBO Jumps Into the Fiscal Cliff Debate

http://wonkwire.com/2012/11/09/cbo-jumps-into-the-fiscal-cliff-debate/

CBO Jumps Into the Fiscal Cliff Debate

November 9, 2012



The Congressional Budget Office has released a report just days before lawmakers return to Washington to address the “fiscal cliff” showing that “Allowing income tax rates to rise for wealthy Americans, and maintaining rates for the less affluent, would not hurt U.S. economic growth much in 2013,” according to Reuters.

“The report by the authoritative non-partisan arm of Congress is expected to fuel President Barack Obama’s demand for higher taxes on the rich… The CBO said the tax hikes for the wealthy would reduce job growth by around 200,000 jobs, much less than the 700,000 in job losses claimed by Republican Speaker of the House John A. Boehner.”

“The CBO said extending all of the tax cuts would boost U.S. gross domestic product growth next year by a little less than 1.5 percentage points. If the tax rates were extended only for individuals earning less than $200,000 and couples earnings less than $250,000, CBO said, growth would rise by 1.25 percent… Eliminating the automatic spending cuts to military and domestic programs would add back 0.75 percentage points of growth, as would extending an expiring payroll tax cut and long- term unemployment benefits that are expected to end next year.”