CBO says fiscal choice is pain now, or bigger pain later - Washington Times

CBO says fiscal choice is pain now, or bigger pain later - Washington Times As Congress prepares to try negotiate ways to avoid the fiscal cliff, its own scorekeeper has some stark analysis: There will be pain no matter what, but ducking choices now will mean an even worse situation by the end of the decade. In two new reports Thursday, the Congressional Budget Office laid out some of the choices facing Washington as lawmakers return next week for a lame-duck session of Congress. But CBO said no matter what Congress does, the economy in the short term will struggle. “Even if all of the fiscal tightening was eliminated, the economy would remain below its potential and the unemployment rate would remain higher than usual for some time,” CBO said. The nonpartisan agency also went on to say that canceling the looming tax increases and spending cuts due in January would deepen deficits and leave the country less able to handle a major crisis in the future. “If the fiscal tightening was removed and the policies that are currently in effect were kept in place indefinitely, a continued surge in federal debt during the rest of this decade and beyond would raise the risk of a fiscal crisis (in which the government would lose the ability to borrow money at affordable interest rates) and would eventually reduce the nation’s output and income below what would occur if the fiscal tightening was allowed to take place as currently set by law.” Read more: CBO says fiscal choice is pain now, or bigger pain later - Washington Times http://p.washingtontimes.com/news/2012/nov/8/cbo-says-fiscal-choice-pain-now-or-bigger-pain-lat/#ixzz2BfYAmi1M Follow us: @washtimes on Twitter