Latest news with #PhillipSwagel
Bloomberg
21 hours ago
- Business
- Bloomberg
Big Take: CBO Director Responds to its Critics
As the debate about President Trump's tax bill — known as the 'One Big Beautiful Bill' — plays out among lawmakers in Washington, there's been increasingly heated criticism of the non-partisan Congressional Budget Office. It calculates the costs and savings from the bill — including from the White House. On today's episode of the Big Take, host Saleha Mohsin sits down with CBO director Phillip Swagel to hear how his agency churns out economic forecasts from inside the center of a political storm.
Yahoo
a day ago
- Business
- Yahoo
Budget Director Claps Back At GOP Critics Of Tax Cut Cost Estimates: ‘I Am A Republican!'
WASHINGTON – The director of the Congressional Budget Office pushed back against Republican criticism in a rare interview on Monday. Republicans have claimed the CBO gets things wrong and that its cost estimates of GOP tax and spending cuts are biased in favor of Democrats because the budget office is run by Democrats. It's not. 'I am a Republican,' CBO Director Phillip Swagel said on CNBC. 'This is a nonpartisan organization, and we work for the entire Congress.' It's unusual for a CBO director to come out and defend his agency against critics, but the budget office has been the subject of an unusual amount of bad-faith criticism over its analysis of Republicans' so-called Big Beautiful Bill. Just doing its job, the CBO has pointed out that the tax cuts in the bill are way bigger than the spending cuts, meaning the legislation would enlarge federal budget deficits and add to the national debt. That's embarrassing for Republicans, since they style themselves as champions of fiscal responsibility and haters of debt, so they've been relentlessly attacking the messenger. 'They are historically totally unreliable,' House Speaker Mike Johnson (R-La.) said earlier this month. 'It's run by Democrats. Eighty-four percent of the number crunchers over there are donors to big Democrats. They don't have our best interests in mind, and they've always been off.' White House press secretary Karoline Leavitt also claimed this month that the CBO's staffers are Democratic donors, while President Donald Trump has said the office is controlled by Democrats. It's not clear where Johnson came up with his 84% figure. A Washington Post analysis of federal campaign spending data showed that only 16 people who'd worked for the CBO have made political donations since 2015, all to Democrats. The agency has more than 270 employees, however, and Swagel, who was appointed to his position on a bipartisan basis, once donated $1,000 to a Republican candidate for governor. Republicans' main arguments against the CBO's credibility have been that it fails to account for how economic growth resulting from tax cuts will increase tax receipts, offsetting revenue loss from the cuts, and that the CBO underestimated revenue following Republican tax cuts in 2017. Swagel pointed out Monday that its revenue forecast was correct for 2018 and 2019, and that the 2020 coronavirus pandemic sparked higher government spending and inflation. 'There's very high inflation starting in March of 2021, and that inflated revenues as well,' Swagel said. He also pointed to higher immigration and capital gains revenue resulting from the Federal Reserve's efforts to boost asset prices. He suggested it was weird to fault CBO for not foreseeing cataclysmic global events as part of its cost estimate for a tax bill. 'There are things that the CBO certainly did not predict,' he said. As for the economic feedback on the tax cuts, Swagel said this week the CBO will put out a so-called dynamic score, a cost estimate that accounts for how the bill's macroeconomic effects could juice revenue, though it will likely still disappoint Republicans. Even the conservative Tax Foundation has found that a dynamic score doesn't erase the giant gap between spending and revenue envisioned by Republicans' bill. The CBO has found that the One Big Beautiful Bill Act, which uses $1 trillion in Medicaid and food aid cuts to partially finance nearly $4 trillion in tax cuts,would add $2.4 trillion to the deficit over a decade and that the tax and spending cuts would favor households with higher incomes. Swagel first defended himself from the barrage of Republican criticism earlier this month in an interview with The Wall Street Journal. 'The attacks are coming from so many directions and the kind of misleading talking points have been picked up so widely,' he said. A handful of Republicans, including former White House adviser Elon Musk, have faulted their colleagues for supporting legislation that would worsen the government's fiscal situation. Rep. Thomas Massie (R-Ky.), who voted against the House version of the One Big Beautiful Bill Act last month, told HuffPost he challenged his colleagues to remove Swagel from his position if they thought he was so bad. 'We can go up there today and pass a resolution and remove him from his post,' Massie said. 'If you all are upset and think he's made that big of a math error, he's obviously in the wrong job, let's take him out.' There's been no effort by Republicans to remove Swagel. In February, before the GOP legislation had taken shape, Johnson had trumpeted the CBO's long-term analysis of the country's fiscal situation, in which the office reported annual deficits would reach $2.6 trillion if Congress didn't take action. 'At a time of soaring deficits, high inflation, and sky-rocketing national debt, the nonpartisan Congressional Budget Office's new economic projections confirm the hard truths about the looming fiscal challenges facing our nation,' Johnson said at the time. Trump's Big Bill Will Cut Taxes By $3.7T And Add $2.4T To Deficit, Budget Office Says Senate GOP Strips Contempt Provision From Tax Bill — But Still Lets Trump Be King After Voting For Trillions In Debt, House Republicans Approve A $9 Billion Cut
The Hill
3 days ago
- Business
- The Hill
House-passed Trump bill would add trillions to debt even when accounting for growth: CBO
The House-passed version of President Trump's tax cut and domestic policy bill would add $3.3 trillion to the national debt, even when accounting for its impact on economic growth, according to an analysis released Tuesday by the Congressional Budget Office (CBO). CBO's 'dynamic' estimate, which factors in how the bill's policies would affect economic growth, found that the One Big Beautiful Bill Act would add $3.3 trillion to the national debt by the end of 2034. The national debt, currently north of $36 trillion, would equal 125 percent of gross domestic product (GDP) by 2034. CBO said the bill would increase GDP by just 0.5 percent over the span of that decade. CBO Director Phillip Swagel said the bill's economic effects would increase deficits and interest rates, leading to an on-net increase in the national debt. Trump's tax cuts, among other measures, would lead to a $3.7 trillion decline in federal revenue over the next ten years. The new CBO score comes as the House-passed bill faces several obstacles in the Senate, which is already plowing ahead with its own version of Trump's policy bill. Republican senators have objected to issues including the overall cost of the bill, cuts to Medicaid and other health programs and tax provisions. Republican leaders have set a deadline of July 4 to send a bill to Trump's desk, but are likely to push the date amid disagreements among senators. Trump and Republicans could face pressure to speed the process along this summer as the U.S. nears the debt limit, which the GOP plans to raise through the president's landmark bill.
CNBC
4 days ago
- Business
- CNBC
CBO Director Phillip Swagel addresses accusations of being partisan
Congressional Budget Office Director Phillip Swagel joins 'Squawk Box' to discuss criticism of the latest CBO report, his expectations for the Federal Reserve, accusations of partisanship, and more.
CBS News
04-06-2025
- Business
- CBS News
Trump tariffs would cut deficits by $2.8 trillion and shrink the economy, CBO says
Washington — President Trump's sweeping tariff plan would cut deficits by $2.8 trillion over a 10-year period while shrinking the economy, raising the inflation rate and reducing the purchasing power of households overall, according to an analysis released Wednesday by the Congressional Budget Office. The numbers were revealed in a letter sent to Democratic congressional leadership outlining how the Trump administration's plan to impose wide-ranging tariffs on countries around the world will affect American households. Baked into the CBO analysis is a prediction that households would ultimately buy less from the countries hit with added tariffs. The budget office estimates that the tariffs would increase the average annual rate of inflation by 0.4 percentage points in 2025 and 2026. The budget office's model also assumes that the tariffs, announced through executive action between January and May, will be in place permanently. "If the Administration makes additional changes to tariffs, the budget baseline will be adjusted to reflect the budgetary implications of those changes as they take effect," CBO Director Phillip Swagel wrote. Since the analysis was conducted, a federal court struck down sweeping tariffs that Mr. Trump invoked under an emergency-powers law. An appeals court allowed the Trump administration to continue collecting the tariffs while the case goes through appeals. Largely confirming what other economic models have predicted, the CBO's estimations show that the tradeoff for a $2.8 trillion deficit reduction over 10 years would be an overall reduction in household wealth. In addition, the tariffs would shrink the economy, or reduce the rate of the gross domestic product by 0.06 percentage points per year. The Penn-Wharton Budget Model's April report predicted that the Republican president's tariffs would reduce long-run GDP by about 6% and wages by 5%. A major caveat of the CBO's estimates is written into the report — its estimates are "subject to significant uncertainty, in part because the Administration could change how the tariff policies are administered." The evaluation also does not appear to take into account any impact from Mr. Trump's massive tax and budget bill currently being debated in Congress. The CBO released another estimate earlier Tuesday showing that the legislation would increase deficits by a total of roughly $2.4 trillion over 10 years. White House have argued that any deficit increase caused by the "one big, beautiful bill" would be offset by the "reciprocal" tariff plans, and touted the CBO's new analysis on Tuesday. Mr. Trump has often announced changes and pauses to his tariff plans on his social media platform. In April, he posted that he was backing off his tariffs on most nations for 90 days and jacking up the tax rate on Chinese imports to 125%. Last week, he announced plans to hike the tariffs on steel and aluminum imports to a punishing 50%, a move that's set to hammer businesses and likely push up prices for consumers even further. The 50% tariffs went into effect Wednesday. The Organization for Economic Cooperation and Development forecast Tuesday that the U.S. economy, the world's largest, will slow growth to just 1.5% in 2026.
