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Steve Bell, Bipartisan Policy Center director of economic policy, weighs in on the CBO’s latest report, and the economic recovery overall.
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Now it also assumes the automatic spending cuts will take place which of course -- Obama says he wants to avoid.
-- and -- break down the numbers Steve Bell senior director of economic policy at the bipartisan policy senator and former staff director for the Senate Budget Committee.
Steep interview with us right now what did you make of all that now we have -- -- CDO come out with these numbers.
The -- -- I suppose is that it permanent tax rates are worked into this it's a little truer.
Other -- out into the future isn't it.
In some ways it is but I'd like to read you the first sentence -- they have in the CBO report.
Economic growth will remain slow this year CBO anticipates.
And they go on to say the -- -- as a percentage of GDP will increase under current law.
And that the last four years are forecast.
Really could not he should not be taken.
As as real forecast of more just sort of an estimation there's there's not much good news in the CBO report if you look at it objectively.
I agree with you and they also said that unemployment -- remain above seven and a half percent through next year but but they did say that.
They thought unemployment was gonna go to eight point 9% in 2012.
Actually came in at seven point 8% so there's -- format wiggle room here isn't there.
There is a -- -- a wiggle room -- you can't get very excited to.
When you have fourteen point 4% of people in America who are -- dropping out of the workforce or looking for work.
I don't think we should change try to sugarcoat in the last hour here on fox -- Four people have used the word unsustainable and it's absolutely true we cannot sustain this fiscal path.
Well I'll make it a fifth and say what's unsustainable to -- are these interest payments we make an and that really is the crux of the problem isn't it.
That almost two thirds of the money our government brings in they pay out it pays out I should say in interest.
What we we spend a tremendous amount and interest and we're very lucky.
That the ten year is only about -- percent to ten year yield because the average is well over 5%.
For the last forty years if that were to occur.
Right now this year really paid 650 billion dollars in interest costs which is slightly larger than in our defense budget.
We're not out of the woods and so far all I've heard frankly are talking points from both sides.
Right so we wanna hear mean.
Look we on now -- now that the majority of this issue is entitlements.
And we're just not seeing any really constructive change isn't being made any time soon.
No we're not we know what's Medicare we know what's Medicaid and we know what's -- as the same problems at this stage -- And no one here is willing to come out and say other than a few people like chairman Ryan.
Listen this is what I -- to do about Medicare is gonna be phased and if you're under 55 you'll be affected by this but if you're over 55 you won't.
Only people like that are willing to say -- and as you know.
-- are sometimes highly criticized for that but that is the truth Medicare is unsustainable in its present form.
And quickly before I let you go -- still keep hearing they want to raise revenues.
The tax code is a book of favors I've said it before what how do we fix this problem because collecting more taxes is not gonna fix it.
Collecting more taxes won't fix it and I think people who believe we'll have fundamental tax reform this year or next.
Are probably over optimistic I'm sad to say.
Yes that's a big bummer Steve Bell we imports we -- to leave -- -- that -- with the bipartisan policy center.
One -- we will have tax reforms one day but.
