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Key Facts From Today’s CBO Report

RNC Communications - August 24, 2011

CBO Says The U.S. Faces “Profound” Challenges And An Economy In A “Severe Slump”

Politico: “The Congressional Budget Office Painted A Dreary Economic Picture Wednesday In A New Report That Warns Of ‘Profound Budgetary And Economic Challenges’ Ahead.” (Seung Min Kim, “CBO Warns Of ‘Profound’ Challenges,” Politico, 8/24/11)

  • Congressional Budget Office (CBO): “[T]he Pace Of The Recovery Has Been Slow, And The Economy Remains In A Severe Slump.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)
  • CBO: “The Slowing In Growth In U.S. Output During The First Half Of 2011 Might Portend The Onset Of Another Recession.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

The Labor Market Has Weakened And Will Remain Depressed For The Next Several Years

The CBO’s Estimates For Future Unemployment Are Higher Than January’s Due To “Weaker Economic Activity Expected For The Next Several Years.” “However, CBO’s projections of the unemployment rate for 2012 through 2016 are higher than they were in January because of the weaker economic activity expected for the next several years.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

CBO Projects Unemployment Rate To Remain Above Eight Percent Until 2014. “The national unemployment rate – now at 9.1 percent – isn’t expected to drop below 8 percent until 2014, according to the report on the country’s budget and economic outlook.” (Seung Min Kim, “CBO Warns Of ‘Profound’ Challenges,” Politico, 8/24/11)

  • Currently, The Unemployment Rate Has Remained Above Eight Percent For A Post-WWII Record 30 Straight Months. (Bureau Of Labor Statistics, BLS.gov, Accessed 8/24/11)
  • Obama’s Economic Advisors Predicted That The Stimulus Would Keep The Unemployment Rate Below 8 Percent With Stimulus. (Christina Romer and Jared Bernstein, "The Job Impact Of The American Recovery And Reinvestment Plan,”  1/9/09)

Rates Of Long-Term Unemployment “Are Unprecedented In The Post-World War II Era” With 31 Percent Of Unemployed Workers Jobless For Over A Year,  “On average, 44 percent of workers who were unemployed in the first half of 2011 had been jobless for more than six months. Moreover, in mid-2011, 31 percent of unemployed workers had been jobless for at least a year. Those rates of long-term unemployment are unprecedented in the post–World War II era.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

Uncertainty Surrounding Dodd-Frank, ObamaCare, Regulatory Policy And Future Changes In Taxes Are Affecting Business’ Ability To Hire And Invest. “In addition, some businesses may be unsure and concerned about how they will be affected by the implementation of recently enacted financial and health care legislation, by the government’s regulatory policies in other areas, and by possible future changes in federal tax and spending policies. However, the degree to which all of those factors may be restraining hiring is difficult to determine.” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

Obama’s Binge Spending Has Amassed Record Deficits

CBO: “The Amount Of Federal Debt Held By The Public Has Skyrocketed In The Past Few Years …” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

  • This Year’s Budget Deficit Will Be The Third Highest In The Last 65 Years, Behind Obama’s Previous Two Record Deficits. “At 8.5 percent of gross domestic product (GDP), the $1.3 trillion budget deficit that the Congressional Budget Office (CBO) projects for 2011 will be the third-largest shortfall in the past 65 years (exceeded only by the deficits of the preceding two years).” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)

Despite Obama’s Promise To Bend The Health Care Cost Curve, The CBO Projects That Federal Health Care Costs Will Continue Rising. “In addition, the major health care legislation enacted in 2012 will increase the number of beneficiaries of federal health care programs, and CBO projects that the costs of those programs per beneficiary will continue rising …” (“The Budget And Economic Outlook: An Update,” Congressional Budget Office, 8/24/11)


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