None of us should put too much stock into any long range economic outlook. But CBO’s economic outlook impacts its (baseline) budget projections, which matter for policymaking in all kinds of ways.The LensQuick
By assuming a gloomier economy—no growth, higher unemployment, stickier inflation, and more aggressive rate hikes in the near term (among other things)—CBO is telling lawmakers that projected deficits over the period 2023-2032 will be $900 billion higher than previously forecast (back in May 2022). Part of that jump is due to higher (revised up $295B) projected debt service over that period.
Keep this in mind, because I’m going to write more about rate hikes and their budgetary impacts in my next post....
Thoughts on CBO's Budget and Economic Outlook
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders
1 comment:
“ We are told that “real GDP growth comes to a halt in 2023 in response to the sharp rise in interest rates during 2022.”
GDPNow at 2.5% for 1Q
https://twitter.com/atlantafed/status/1626257105324761089?s=61&t=pHpS7SAMuyJVLtFtK73h2A
https://www.atlantafed.org/cqer/research/gdpnow
Post a Comment