During Congressional deliberations on health care legislation during the 111th Congress, CBO prepared numerous analyses and estimates regarding the impact of various proposals on the federal budget and on aspects of health care and health insurance that were of interest to policymakers. That process began in early 2009 and continued past the enactment of the legislation in March of this year. In many cases, those estimates and analyses were prepared in collaboration with the staff of the Joint Committee on Taxation.
December 2010
Fannie Mae and Freddie Mac are government-sponsored enterprises (GSEs)privately owned financial institutions that were chartered by the Congress four decades ago to fulfill a public mission: to provide a stable source of funding for residential mortgages across the country, including loans on housing for low- and moderate-income families.
Recently, the federal government has been recording the largest budget deficits, as a share of gross domestic product (GDP), since the end of World War II. As a result of those deficits, the amount of federal debt held by the public has soared—surpassing $9.0 trillion at the end of fiscal year 2010 and equal to 62 percent of GDP. The interest the government pays on that debt is currently low by historical standards as a percentage of GDP but is expected to grow rapidly over the next several years as interest rates rise.
Congress recently considered creating a nationwide cap-and-trade program that would limit emissions of greenhouse gases below the levels projected under current law and would allow trading of rights, or allowances, to produce those emissions. The ability to buy and sell allowances would reduce the cost to the economy of meeting the cap by letting market forces determine where, how, and when the associated cuts in emissions would be made.
Under current policies, the aging of the U.S. population and increases in health care costs will almost certainly push up federal spending significantly in coming decades relative to the size of the economy. Without changes in policy, spending on the government’s major mandatory health care programs as well as on Social Security will increase from the present level of roughly 10 percent of the nation’s output, or gross domestic product (GDP), to about 16 percent over the next 25 years.
In 2009, the expenditures of local governments—including counties, cities, towns, school districts, and special districts—equaled 8.7 percent of gross domestic product, and those governments employed just over 9 percent of the labor force. Those governments, which play a significant role in people’s lives and in the nation’s economy, have not been immune to the weak economic conditions of the past few years. Many are facing significant budgetary challenges (often termed “fiscal stress”) and have been compelled to constrain spending and services.
The federal budget deficit was $283 billion for the first two months of fiscal year 2011, CBO estimates in its latest Monthly Budget Review, $14 billion less than the shortfall recorded through November of last year. Outlays and revenues alike are higher than they were last year at this time, by about 2 percent and 9 percent, respectively.
Today CBO released an update to its February 2006 paper Immigration Policy in the United States. The publication is a collection of tables and figures with descriptive text (shown below). The update presents data through 2009 and makes comparisons with 2004, the most recent year for which most data were reported in the earlier paper.
In addition to the information provided in my testimony yesterday, you can find further information on trends in federal revenues and how changes to U.S.
Today I testified before the Senate Finance Committee on historical trends in federal tax revenues and rates. My written testimony is a collection of tables and figures with descriptive text (shown below). It addresses three broad topics: revenues collected by the federal government, how taxes affect economic activity, and the tax burden and who bears it.