This morning I testified before the House Budget Committee on The State of the Economy and Issues in Developing an Effective Policy Response (click here for full text of my written testimony). My testimony discussed both the basis for CBO's forecast (released earlier this month, click here for text) and reviewed the financial and nonfinancialdevelopments that have occurredsince that forecast was finalized. So far, the news has been generally consistent with the agency's expectations-- and does not alter the bleak outlook.
Itouched on three key points this morning:
As the possibility of another round of fiscal stimulus is debated, it is nota surprisethat employment effects of stimulus have emerged as a key measuring stick. According to CBO's estimates, with enactmentof H.R. 1,the number of jobswould be between 0.8 million and 2.1 million higher at the end of this year, 1.2 million to 3.6 million higher at the end of next year, and 0.7 million to 2.1 million higher at the end of 2011 than under current law.