News
WSJ | Forecast Clouds Debt-Cut Outlook
High CBO Jobless Forecast Complicates Task for Congressional Debt Committee.
National Journal | Revised CBO Report Could Need More Revisions
Though the new CBO data released on Wednesday paints a more optimistic picture than previous agency reports, this version is predicated on some highly fickle assumptions: from the prowess of the super committee to find consensus this fall, to increased revenue through the expiration of tax cuts, to decreased spending on programs such as federal unemployment benefits.
WSJ | Irene on Path to Test Coffers of State-Run Insurers
Of the 14 U.S. states in Irene's projected path as of late Wednesday, at least 10 of them run insurance pools for homes in vulnerable areas. Those insurers, which have ballooned in size in recent years, now have about 677,000 policyholders and overall exposure of $196.2 billion, according to the states.
Econ Comments
Politico | Triggers to cut deficit don't work
Yet Gramm-Rudman-Hollings’ flaws were evident from the start. By exempting tax increases and entitlement spending, the bill ignored two major components of the deficit. With these sacred cows off the table, sequestration was limited to relatively minor parts of the budget.
WSJ | What Austerity?
Federal spending will hit a new record this year.
Daily Caller | Job #1 for the budget super-committee: cut the new health care entitlement’s cost
Health care cost growth is a primary driver of the federal government’s financial problems.
Blogs
Cato@Liberty | The Dumbest Budget ‘Plan’ Yet
I don’t take issue with George’s guesstimate that 25 percent of all government spending is waste. But the notion that federal spending can be cut by 25 percent every year by implementing particular quality control procedures in government is crackpot.
Cato@Liberty | New CBO Numbers Confirm – Once Again – that Modest Spending Restraint Can Balance the Budget
This certainly doesn’t reflect well on the Obama White House, which claimed that flushing $800 billion down the Washington rathole would prevent the joblessness rate from ever climbing above 8 percent.
Reports
NBER | Over-optimism in Forecasts by Official Budget Agencies and Its Implications
The paper studies forecasts of real growth rates and budget balances made by official government agencies among 33 countries.
