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Publication Date: September 2007
Publisher: Center on Budget and Policy Priorities (Washington, D.C.)
Author(s): Chad Stone
Research Area: US Fiscal Future
Keywords: Economic projections; Federal budget; Tax code; Fiscal future
Type: Report
Abstract:
The economic benefits of reducing long-run deficits are very large, and there is only a modest difference between the economic effects of shrinking deficits by raising taxes and doing so by cutting expenditures. This is the key conclusion of a recent Congressional Budget Office response to a request from Senator Judd Gregg (R-NH), the ranking member of the Senate Budget Committee, for an analysis of the potential economic effects of relying on higher taxes alone to finance projected increases in federal expenditures in coming decades.