Committee For a Responsible Federal Budget

12/02/2024

🚨 As policymakers consider extending parts of the Tax Cuts and Jobs Act (TCJA) and possibly making other tax changes, there will be discussion about how best to score the deficit effects of any changes.

"Conventional scoring" incorporates the effects of tax changes on individual and business behavior, but it does not account for the effects on macroeconomic variables such as output, employment, inflation, and interest rates, while “dynamic scoring” does incorporate macroeconomic effects.

The following is a statement from CRFB president : https://www.crfb.org/press-releases/policymakers-should-include-dynamic-scores-tax-reform

10/07/2024

🇺🇸 NEW ANALYSIS: The Fiscal Impact of the Harris and Trump Campaign Plans🇺🇸

Our comprehensive analysis breaks down the presidential candidates' tax and spending plans and what they would mean for the national debt.

Read the full analysis here: https://crfb.org/papers/fiscal-impact-harris-and-trump-campaign-plans

Under our central estimate, we find:

➡️ Vice President Harris would add $3.50 trillion to the projected debt through FY 2035

➡️ President Trump would add $7.50 trillion to the projected debt through FY 2035

As in past election years, this analysis presents high- and low-cost estimates for each proposal along with our central estimates.

Under our low-cost estimate, we find the Harris plan would be roughly deficit neutral, while the Trump plan would increase the debt by $1.45 trillion.

Under our high-cost estimate, we find the Harris plan would increase debt by $8.10 trillion, while the Trump plan would increase debt by $15.15 trillion.

***This report is a product of our US Budget Watch 2024 project designed to educate the public on the fiscal impact of presidential candidates' proposals and platforms. We do not support or oppose any candidate for public office.***

06/26/2024

🇺🇸 Trump and Biden: The National Debt 🇺🇸

The national debt is on course to reach a record share of the economy under the next presidential administration, due in part to policies approved by Presidents Trump and Biden during their time in office.

In new analysis from our US Budget Watch project, we find:

➡️ President Trump approved $8.4 trillion of new ten-year borrowing during his full term in office, or $4.8 trillion excluding the CARES Act and other COVID relief.

➡️ President Biden, in his first three years and five months in office, approved $4.3 trillion of new ten-year borrowing, or $2.2 trillion excluding the American Rescue Plan.

Read the full analysis, including breakdowns for both President Trump and President Biden along with our methodology, on our website at https://www.crfb.org/papers/trump-and-biden-national-debt

04/17/2024

📰 NEW in Star Tribune: CRFB Co-Chair Tim Penny and Emeritus Member David Minge, both former MN Reps., discuss a worrying Tax Day reality – more and more of our income tax payments go toward interest on the national debt.

They argue our fiscal health hasn't always been this bad – and it can be made better once again.

Read more: https://startribune.com/taxes-increasingly-paying-for-the-past-not-the-future/600359361/

03/20/2024

🚨NEW STATEMENT🚨 The Congressional Budget Office released its latest Long-Term Budget Outlook today, projecting the nation’s finances over the next 30 years.

CBO projects that the debt held by the public will hit a new record share of the economy in just four years and grow to 166 percent of Gross Domestic Product (GDP) by 2054.

CBO also projects that the Social Security Old-Age and Survivors Insurance trust fund will be exhausted in 2033, the Medicare Hospital Insurance trust fund in 2035, and the Highway Trust Fund in 2028.

The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

"This is yet another reminder that politicians put political priorities ahead of the long-term health of the country. There is no way to look at these eye-popping numbers without realizing we need to make a change. And yet we have lawmakers promising what they won’t do: I won’t raise taxes, I won’t fix Social Security, I won’t pay for all the things I do want to do. And so we continue on this dangerous path.

"Despite some recent progress with the Fiscal Responsibility Act, our debt remains on an unsustainable trajectory. Even under current law, CBO projects debt will double as a share of the economy relative to pre-pandemic levels. And major trust funds supporting Social Security, highways, and Medicare face looming insolvency.

"So far, the presidential campaign is not offering any hope – candidates need to be asked how they would fix Social Security, fix Medicare, and bring the debt back to manageable levels. Voters should not be satisfied without specific answers.

"The scariest part of our grim fiscal outlook is rising interest costs. Those costs have already doubled as a share of the economy since 2015, and this year CBO believes interest will cost more than defense spending or Medicare. By 2053, interest costs will double again after becoming the single largest line item in the entire federal budget in 2051. This year, we will spend $870 billion on interest – more than all the federal dollars we spend on children – and that number will only grow from here..."

Click here to read the full statement on our website: https://www.crfb.org/press-releases/cbo-presents-grim-long-term-fiscal-outlook

03/11/2024

🚨 BREAKING: President Biden released his Fiscal Year 2025 budget request today, including a number of tax and spending proposals and a roadmap for the country’s finances over the next decade.

Under the President’s budget, based on its own estimates, the national debt would rise to $45.1 trillion or 105.6 percent of Gross Domestic Product (GDP) by 2034, from $27.4 trillion or about 97 percent of GDP today. The budget would reduce deficits by a net $3.3 trillion over the next decade, relative to its baseline.

The following is a statement from CRFB president Maya MacGuineas:

President Biden released his Fiscal Year 2025 budget request today, including a number of tax and spending proposals and a roadmap for the country’s finances over the next decade.

02/08/2024

🚨 FULL ANALYSIS 🚨 of the Congressional Budget Office (CBO)'s February 2024 Budget and Economic Outlook ⤵️

➡️ Debt will reach record 116% of GDP by 2034;
➡️ Deficits will reach $2.6 trillion by 2034;
➡️ Spending and revenue will remain far apart;
➡️ Interest costs will explode;
➡️ Major trust funds are approaching insolvency;
➡️ The FRA improved the fiscal outlook;
➡️ Inflation will fall; growth will remain steady; interest rates remain high.

Read all the findings at https://crfb.org/papers/cbos-february-2024-budget-and-economic-outlook

01/10/2024

🚨 NEW REPORT 🚨 How has America's fiscal situation deteriorated so badly since a budget surplus in 2001?

In our new analysis, we looked at this in two ways:

➡️ By estimating the impact of significant policy changes since 2001;
➡️ By comparing spending and revenue levels as a share of GDP in 2001 to those in 2023.

What we found: contrary to popular belief, both spending increases and revenue reductions (in most cases, bipartisan) can explain the growth in deficits and debt.

👉 Read "From Riches to Rags" here:

In 2001, the U.S. federal government ran a $128 billion budget surplus and was on course to pay off the national debt by 2009.

12/14/2023

🚨NEW STATEMENT: According to press reports, policymakers may be close to reaching a bipartisan tax cut deal that would temporarily restore various business tax breaks while temporarily expanding the Child Tax Credit.

The deal would reportedly cost about $100 billion over a decade as scored but could set the stage for over $800 billion in tax cuts.

Expanding the Child Tax Credit by roughly $50 billion retroactive to 2023 through 2025 could cost $180 billion through 2033 if made permanent. Reviving the business tax breaks under discussion would cost about $50 billion through 2025 but would cost closer to $650 billion through 2033 if made permanent.

Congress may also consider additional spending measures in the coming months that could add over $1 trillion more to the deficit if made permanent. See our recent analysis on these policies here.

The following is a statement by Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

"It’s hard to overstate the hypocrisy driving this deficit-financed tax cut effort. The politicians warning that deficits are out of control are teaming up with those who are denouncing tax cuts to pass yet another deficit-exploding tax cut bonanza.

"2023 has been a good year fiscally – Congress and the President have enacted $1.3 trillion of ten-year deficit reduction – a downpayment on what is needed. With near-record debt levels and exploding interest payments, now is not the time to undermine that progress.

"Some will claim this package is necessary to boost business investment and support American children. But without offsets, the higher debt will crowd out private investment and burden our children.

"We don’t think voters want Congress to borrow another $100 billion, let alone another $800 billion, and the Committee for a Responsible Federal Budget strongly recommends they do not."

Click here to read the full statement online: https://www.crfb.org/press-releases/congress-should-avoid-costly-tax-cut-holiday-season

12/12/2023

🚨 NEW STATEMENT: The United States borrowed $381 billion in the first two months of fiscal year 2024, including $314 billion in November, according to the latest Monthly Treasury Statement from the Treasury Department.

The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

"It’s hard to tell what’s more disheartening about today’s deficit numbers from the Treasury: the fact that we borrowed over a third of a trillion dollars in just two months – $6 billion per day – or the fact that we’re barreling into 2024 without a budget or a serious plan to change course. In truth, both are dismal.

"When it comes to budgeting, 2023 has shown us both the good and the bad. We saw the rare moment of success when both sides came together to enact $1.5 trillion in deficit reduction through the Fiscal Responsibility Act – but we also saw the consequences of kicking the can down the road, with multiple funding deadlines and timely budgetary decisions to make in the new year. And the longer we allow our debt to worsen, the less room we ultimately have to respond to the kinds of global emergencies we’re seeing in the world today.

"This leaves policymakers with a choice: make the hard choices today by paying for our priorities and putting the national debt on a sustainable trajectory, or saddle the next generation with an even worse situation."

Click here to read the full statement online: https://www.crfb.org/press-releases/treasury-381-billion-deficit-first-2-months-fiscal-year

12/08/2023

The United States borrowed $383 billion in the first two months of fiscal year 2024, including $317 billion in November, according to the latest Monthly Budget Review from the Congressional Budget Office.

The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

"There’s no way around it: Congress has a sleigh full of problems this holiday season. Not least of which is the fact we just borrowed $383 billion in the first two months of the fiscal year – $6 billion borrowed each day – without even doing anything differently in that time."

Credit where it’s due, lawmakers have so far managed to break a yearslong stretch of deficit increases by working together to reduce ten-year deficit projections by $1.3 trillion. It’s real progress worthy of real praise. But the road ahead is daunting: we have two funding deadlines in the next two months, a possible year-end tax package threatening to balloon deficits, ongoing negotiations over an emergency supplemental, and the looming insolvency of the trust funds millions of Americans rely upon."

Much more needs to be done to put the national debt on a sustainable path, and the best thing Washington can do to make that happen is to build momentum on the rare progress we’ve seen this year. At the very least, they should offset new spending or tax cuts. But we’ve also seen bipartisan, bicameral support for a fiscal commission in recent weeks; this is an opportunity for essential conversations on all parts of the budget that we mustn’t squander."

Click here to read the entire statement online: https://www.crfb.org/press-releases/cbo-estimates-383-billion-deficit-first-two-months-fiscal-year

11/09/2023

🚨 NEW STATEMENT: Today, in a show of fiscal leadership and bipartisanship, Senators Joe Manchin (D-WV) and Mitt Romney (R-UT) announced the Fiscal Stability Act, a bill to establish a fiscal commission to address our ever-growing national debt, along with Senators John Cornyn (R-TX), John Hickenlooper (D-CO), Cynthia Lummis (R-WY), Jeanne Shaheen (D-NH), Kyrsten Sinema (I-AZ), Thom Tillis (R-NC), Mark Warner (D-VA), and Todd Young (R-IN). This comes on the heels of a similar proposal in the House by the Bipartisan Fiscal Forum Co-Chairs, Representatives Bill Huizenga (R-MI) and Scott Peters (D-CA).

The commission would be comprised of 16 members, with 12 lawmakers and four non-voting external experts, appointed by the leadership from both parties in the House and Senate. The commission's primary mission would be to produce a plan to improve the nation’s fiscal trajectory with bipartisan backing.

Support has been growing for a fiscal commission with endorsements from members of the House Bipartisan Fiscal Forum, the Problem Solvers Caucus, outside experts, former senators, and former representatives from both sides of the aisle.

The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

"A fiscal commission holds real promise as a way to break out of the free lunch thinking that dominates Washington and put in place a comprehensive debt deal. Fixing our fiscal imbalances will not be easy – it will require putting everything on the table, focusing on policy over politics, and a significant level of compromise. Anyone who is being honest knows this is the only way to resolve our fiscal challenges.

"A commission has the benefit of bringing together a diverse group of lawmakers to delve into the issues, build trust, and provide political cover for policy choices that will not be easy. Our current political environment does not lend itself to these types of difficult choices, but the longer we wait the harder they will be. Our high and rising debt is not only weakening our economy, but also compromising our national security.

"There is no guarantee a fiscal commission will be successful. Special interest groups will raise millions of dollars to attack every idea, and many lawmakers will choose partisanship over problem-solving.

"But a commission is likely our best hope to tackle America’s immense challenges. Commissions have worked before, and they can work again. Historically, commissions have played pivotal roles in safeguarding Social Security, improving military efficiency, enhancing national security, innovating tax code improvements, and guiding the national discourse on fiscal policy. A commission can help policymakers build upon recent fiscal successes to show we can govern and make hard choices.

"Establishing a fiscal commission is an important step toward addressing our nation’s fiscal challenges and securing the budget and economy for future generations. No one should stand in the way of trying to come up with bipartisan compromise solutions."

Click here to read the full statement online: https://www.crfb.org/press-releases/crfb-applauds-fiscal-stability-act