Friday, September 17, 2010

CBO Elmendorf: Presentation to Macroeconomic Advisers: Fiscal Policy Choices in Uncertain Times

From CBO Director Doug Elmendorf's presentation to Macroeconomic Advisers, "Fiscal Policy Choices in Uncertain Times" on September 16, 2010:
  • The economic recovery will probably proceed at a modest pace—leaving total output well below its sustainable level, and the unemployment rate well above its sustainable level, for a number of years.

  • In CBO’s judgment, the available monetary and fiscal tools, if applied at sufficient scale, would improve economic conditions during the next few years—though with costs and risks in the medium and long term. Policymakers need to address those trade-offs.

  • To avoid worsening the medium-term and long-term imbalance between federal spending and revenue, any policies that widened budget deficits in the near term would need to be accompanied by specific polices to reduce spending or increase revenue over time.
Read the CBO director's complete presentation here or below.
Elmendorf Fiscal Policy Choices in Uncertain Times

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