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CBO: Stimulus Harmful

Mike

Well-known member
Wednesday, February 4, 2009
CBO: Obama stimulus harmful over long haul
Stephen Dinan (Contact)
President Obama's economic recovery package will actually hurt the economy more in the long run than if he were to do nothing, the nonpartisan Congressional Budget Office said Wednesday.

CBO, the official scorekeepers for legislation, said the House and Senate bills will help in the short term but result in so much government debt that within a few years they would crowd out private investment, actually leading to a lower Gross Domestic Product over the next 10 years than if the government had done nothing.

CBO estimates that by 2019 the Senate legislation would reduce GDP by 0.1 percent to 0.3 percent on net. [The House bill] would have similar long-run effects, CBO said in a letter to Sen. Judd Gregg, New Hampshire Republican, who was tapped by Mr. Obama on Tuesday to be Commerce Secretary.

The House last week passed a bill totaling about $820 billion while the Senate is working on a proposal reaching about $900 billion in spending increases and tax cuts.

But Republicans and some moderate Democrats have balked at the size of the bill and at some of the spending items included in it, arguing they won't produce immediate jobs, which is the stated goal of the bill.

The budget office had previously estimated service the debt due to the new spending could add hundreds of millions of dollars to the cost of the bill -- forcing the crowd-out.

CBOs basic assumption is that, in the long run, each dollar of additional debt crowds out about a third of a dollars worth of private domestic capital, CBO said in its letter.

CBO said there is no crowding out in the short term, so the plan would succeed in boosting growth in 2009 and 2010.

The agency projected the Senate bill would produce between 1.4 percent and 4.1 percent higher growth in 2009 than if there was no action. For 2010, the plan would boost growth by 1.2 percent to 3.6 percent.

CBO did project the bill would create jobs, though by 2011 the effects would be minuscule.
 

hypocritexposer

Well-known member
They seem stuck on 2 numbers. $1 Trillion, and 3-4million jobs.

Why is it wrong to ask...

Could more than 4M jobs be create/saved, if the money was spent differently?

Is there any way to create/save 3-4M jobs, with less money?

The only question the Democrats seem to be asking, is how do we get this passed, and fast? They admit these jobs will be created/saved over 3 yrs, so what's a week, if it makes the stimulus better?

Just doesn't make sense, unless their intentions are unstated!
 

TexasBred

Well-known member
They better get a vote quickly because "the people" are turning against it quickly....last I heard support for it was less than 35%.
 

hypocritexposer

Well-known member
Well is it any wonder when you do things like this.

First you decide how to spend the money, 2nd you hire "experts", to tell you how the money should be spent. Cart before horse again?

WASHINGTON -- President Obama has announced a team of outside economic advisers to help boost an economy in a virtual free fall.

The president signed an executive order creating the Economic Recovery Advisory Board, headed by former Federal Reserve Chairman Paul Volcker. He planned to introduce members of the team at a White House ceremony Friday morning.

His announcement came as employers eliminated 598,000 jobs in January, the most since the end of 1974, and the unemployment rate soared to 7.6 percent.

In a statement, the White House said the board will offer independent advice in regular briefings to the president, vice president and their economic team.

The White House said the board's initial focus will be programs to "jump-start economic growth."
 

Sandhusker

Well-known member
Mike said:
Wednesday, February 4, 2009
CBO: Obama stimulus harmful over long haul
Stephen Dinan (Contact)
President Obama's economic recovery package will actually hurt the economy more in the long run than if he were to do nothing, the nonpartisan Congressional Budget Office said Wednesday.

CBO, the official scorekeepers for legislation, said the House and Senate bills will help in the short term but result in so much government debt that within a few years they would crowd out private investment, actually leading to a lower Gross Domestic Product over the next 10 years than if the government had done nothing.

CBO estimates that by 2019 the Senate legislation would reduce GDP by 0.1 percent to 0.3 percent on net. [The House bill] would have similar long-run effects, CBO said in a letter to Sen. Judd Gregg, New Hampshire Republican, who was tapped by Mr. Obama on Tuesday to be Commerce Secretary.

The House last week passed a bill totaling about $820 billion while the Senate is working on a proposal reaching about $900 billion in spending increases and tax cuts.

But Republicans and some moderate Democrats have balked at the size of the bill and at some of the spending items included in it, arguing they won't produce immediate jobs, which is the stated goal of the bill.

The budget office had previously estimated service the debt due to the new spending could add hundreds of millions of dollars to the cost of the bill -- forcing the crowd-out.

CBOs basic assumption is that, in the long run, each dollar of additional debt crowds out about a third of a dollars worth of private domestic capital, CBO said in its letter.

CBO said there is no crowding out in the short term, so the plan would succeed in boosting growth in 2009 and 2010.

The agency projected the Senate bill would produce between 1.4 percent and 4.1 percent higher growth in 2009 than if there was no action. For 2010, the plan would boost growth by 1.2 percent to 3.6 percent.

CBO did project the bill would create jobs, though by 2011 the effects would be minuscule.

And the liberal response is.....?
 

leanin' H

Well-known member
Every Republican Politician who voted for this trainwreck oughta be unemployed come the next election! What happened to being a conservative? Especially when it comes to spending? This is bad legislation from poor leadership that have no plan except to go with the first knee-jerk reaction presented to them! :roll: This bill is most every fantasy from every liberal lawmaker rolled into one and called "Stimulus"!
This ought to work well if they are trying to Stimulate the reccession! :wink:
 
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