The balanced budget amendment introduced by Senate Republicans yesterday contains a striking error. As written, it would limit federal spending much more than they claim or, I suspect, intend (I said the same back in 2011, when this first came up). The senators want to balance the budget by limiting spending rather than raising tax [...]

The Congressional Budget Office released its latest Budget and Economic Outlook earlier this week.  As always, the Outlook provides insight into the fiscal status of the federal government. My three overarching reactions are: First, because American Taxpayer Relief Act of 2012 (ATRA) instituted tax changes that had been widely expected, the official (“current law”) baseline is now much [...]

Last week I argued that budgeting for Medicare’s hospital insurance program is flawed. Today, I offer two ways to fix it (and reject a third). Medicare Part A is one of several federal programs that control spending through a “belt and suspenders” combination of regular program rules (the belt) and an overall limit (the suspenders). But [...]

The recent double-counting dispute isn’t just about politics; it also reveals a flaw in budgeting for Medicare Part A. Budget experts are waging a spirited battle over the Medicare changes that helped pay for 2010’s health reform. In April, Chuck Blahous, one of two public trustees of the program, released a study arguing that the [...]

My latest column for the Christian Science Monitor argues that a slew of budget deadlines will drive policy action this Fall. Case in point, the potential for a government shutdown when the government’s fiscal year ends later this week. I don’t think that’s likely, at least not yet, but such deadlines will be the big thing this [...]

In a couple of weeks, President Obama will ask Congress to extend this year’s payroll tax cut. It will surely become a classic Washington double-reverse rhetorical moment. I can’t wait to hear Obama lift some of House Speaker John Boehner’s (R-OH) best lines about the folly of raising taxes in the midst of an economic [...]

My latest column at the Christian Science Monitor: America’s leaders need to get to yes on a budget deal – one that marries substantial deficit cuts with a much-needed increase in the debt limit. But that’s not enough. Rather than merely increasing the debt limit, we should eliminate it. I realize that sounds strange. With [...]

There has been a lot of talk in Washington recently about “job-killing tax increases.” Raising taxes, the argument goes, would lead businesses to hire fewer workers and stifle our already weak economic recovery. But I haven’t heard anyone talking about “job-killing spending cuts.” In macroeconomic terms, tax increases and spending cuts have qualitatively the same [...]

Senate Republicans made a striking error in the balanced budget amendment they introduced last week. As written, the amendment would limit federal spending far more than those senators realize or, I suspect, desire. The Republicans want the budget to be balanced by keeping spending down rather than by raising tax revenues. They thus propose limiting [...]

I’m preparing a presentation on our tax system for a group of visiting foreign tax officials and they wanted to know how responsibilities are divided within the federal government.  Seems like a fair question. In other countries, the process is often quite streamlined:  a Ministry of Finance, which makes the political decisions, a Treasury Department, [...]