On Wednesday I spoke at a conference on the health care system hosted by the Institute of Medicine. My presentation dealt with health care costs and the federal budget. The central challenge is straightforward and stark: The rising costs of health care will put tremendous pressure on the federal budget during the next few decades and beyond.
May 2010
The United States Navy and Marine Corps operate a fleet of more than 1,100 tactical fighter aircraft that provide air-to-air and air-to-ground combat capabilities. Those aircraft include Hornets (F/A-18A, B, C, and D), Super Hornets (F/A-18E and F), and Harriers (AV-8B); within the next few years, a new and more advanced aircraft—the F-35 Joint Strike Fighter (JSF)—will start being added to the fleet.
Early last week, I wrote that CBO is providing basic budget and economic analysis for the National Commission on Fiscal Responsibility and Reform.
Under the American Recovery and Reinvestment Act of 2009 (ARRA), also known as the economic stimulus package, certain recipients of funds appropriated in ARRA (most grant and loan recipients, contractors, and subcontractors) are required to report the number of jobs they created or retained with ARRA funding after the end of each calendar quarter. The law also requires CBO to comment on those reported numbers. Today CBO released a report to satisfy that requirement.
The Navy is required by law to submit a report to the Congress each year that projects the service’s shipbuilding requirements, procurement plans, inventories, and costs over the coming 30 years. Since 2006, CBO has been performing an independent analysis of the Navy’s latest shipbuilding plan at the request of the Subcommittee on Seapower and Expeditionary Forces of the House Armed Services Committee.
Over the past several years, the nation has experienced its most severe financial crisis since the Great Depression of the 1930s. To stabilize financial markets and institutions, the Federal Reserve System used its traditional policy tools to reduce short-term interest rates and increase the availability of funds to banks, and created a variety of nontraditional credit programs to help restore liquidity and confidence to the financial sector. In doing so, it more than doubled the size of its asset portfolio to over $2 trillion and assumed more risk of losses than it normally takes on.
CBO and the staff of the Joint Committee on Taxation (JCT) have prepared an estimate of the budgetary effects of H.R. 4213, the American Jobs and Closing Tax Loopholes Act, as posted on the Web site of the Committee on Ways and Means on May 20, 2010. CBO and JCT estimate that the legislation would increase budget deficits by about $123 billion for fiscal years 2010 and 2011, by about $141 billion over the 2010-2015 period, and by about $134 billion over the 2010-2020 period.
CBO has a panel of economic advisers that includes many distinguished economists (some of whom are former CBO directors). We host periodic meetings of the advisers at our office and solicit the advisers’ views between meetings via email exchanges and phone calls. Through these interactions, we benefit from the advisers’ understanding of cutting-edge research, current economic conditions and the economic outlook, and economic policy. As a result of the advisers’ comments, the quality of CBO’s economic analysis is greatly enhanced. The advisers for 2010 are:
This afternoon I spoke at a Brookings conference on climate and energy policy. CBO has done a great deal of work in this area, applying the research done by outside experts as well as our own analysis and modeling to help the Congress understand the likely budgetary and economic effects of alternative policy approaches and specific legislative proposals being considered.
At the request of Congressional budget leaders, CBO is providing basic budget and economic analysis and estimates for the National Commission on Fiscal Responsibility and Reform. That bipartisan commission is composed of 18 members, six appointed by the President and the other 12, all Members of Congress, appointed by the Congressional leaders of both parties. The commission is charged with formulating recommendations designed to balance the federal budget, excluding interest payments on the debt, by 2015, and to meaningfully improve the nations long-run fiscal outlook.