CBO: Obama 2013 budget would slow economic growth

Slow the economy from it's already glacial pace? Sounds like recession to me. The Hill: The nonpartisan Congressional Budget Office said Friday that President Obama's 2013 budget will hurt the economy in the long term, arguing the larger deficits it would produce would reduce the amount of capital available to businesses. After five years, the CBO says, the Obama proposals would reduce economic output by between 0.5 percent and 2.2 percent. Larger deficits caused by the budget would cause the government to issue more bonds, sucking up private capital to finance its debts and thereby reducing the funds businesses could use to expand and hire, the CBO said. An increased tax on capital gains included in the president's plan would also tend to reduce private capital, it says. The 2013 Obama budget proposes continuing the Bush tax rates for the middle class and enacting elements of a short-term Jobs Act stimulus. In the near term, actions such as these could increase growth by...(Read Full Post)

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