WASHINGTON, D.C. — The top Republican on the House Financial Services Committee, Patrick McHenry (NC-10), and the top Republican on the Subcommittee on Oversight and Investigations, Tom Emmer (MN-06), sent a letter to the non-partisan Congressional Budget Office (CBO) asking the agency to report to Congress on the impact of Democrats’ reckless new government spending proposals on our economic recovery. Specifically, the Congressmen urge the CBO to analyze the disastrous effects of Democrats’ irresponsible spending on GDP growth and consumer prices.
Read the full letter here.
Read excerpts from the letter:
The Republican Leaders write: “Last September, the Congressional Budget Office issued a report entitled ‘The Effects of Pandemic-Related Legislation on Output.’ The reported analyzed the economic impact of the four spending bills Congress passed between March and April 2020, including the effect on gross domestic product (GDP), inflation, the debt and deficits. Since then, Congress has spent an additional $900 billion in December 2020 and $2 trillion in March 2021 in response to the global pandemic. Moreover, Democrats are on the cusp of spending an additional five trillion, some of which will be paid for through higher taxes, but mostly financed through additional debt.
“This massive spending spree will have short and long-term implications for the economy, including on GDP and inflation. Current CBO fourth quarter projections suggest GDP will grow to 7.4 percent, inflation will hold at 2.8 percent, and unemployment will drop to 4.6 percent. Recent data suggests the economy is slowing as prices continue to rise. Moreover, there continues to be a significant disconnect between employers and workers. We are concerned that massive new spending will only exacerbate this negative trend.
“To that end, we request that CBO update its September 2020 report to include the effects of the December and March spending. In addition, CBO should also include a projection of the impact the $1.2 trillion Infrastructure Investment and Jobs Act and the $3.5 trillion in new spending associated with reconciliation will have on the economy. The report should include the impact on consumer prices, employment, wages and overall economic conditions.”