Lenny Skutnik is a household name belonging to an unassuming Congressional Budget Office employee who insists he “wasn’t a hero” when one winter day in 1982 he jumped from the shore into the icy Potomac River to save a drowning woman after an Air Florida flight crashed on takeoff. “I was just someone who helped another human being,” Lenny said later. While his rescue of Priscilla Tirado that day was extraordinary, Lenny has been helping the employees at CBO for more than 30 years.
CBO Blog
A short time ago, I received an interesting letter from a young man in Michigan asking about federal budget deficits. I thought that perhaps other students would be interested in the kinds of questions he asked and how I answered him, so I’ve decided to share my letter to him with all of you. Here’s what I wrote:
1. What are the primary causes of the current federal budget deficits?
On Wednesday I spoke at a conference on the health care system hosted by the Institute of Medicine. My presentation dealt with health care costs and the federal budget. The central challenge is straightforward and stark: The rising costs of health care will put tremendous pressure on the federal budget during the next few decades and beyond.
The United States Navy and Marine Corps operate a fleet of more than 1,100 tactical fighter aircraft that provide air-to-air and air-to-ground combat capabilities. Those aircraft include Hornets (F/A-18A, B, C, and D), Super Hornets (F/A-18E and F), and Harriers (AV-8B); within the next few years, a new and more advanced aircraft—the F-35 Joint Strike Fighter (JSF)—will start being added to the fleet.
Early last week, I wrote that CBO is providing basic budget and economic analysis for the National Commission on Fiscal Responsibility and Reform.
Under the American Recovery and Reinvestment Act of 2009 (ARRA), also known as the economic stimulus package, certain recipients of funds appropriated in ARRA (most grant and loan recipients, contractors, and subcontractors) are required to report the number of jobs they created or retained with ARRA funding after the end of each calendar quarter. The law also requires CBO to comment on those reported numbers. Today CBO released a report to satisfy that requirement.
The Navy is required by law to submit a report to the Congress each year that projects the service’s shipbuilding requirements, procurement plans, inventories, and costs over the coming 30 years. Since 2006, CBO has been performing an independent analysis of the Navy’s latest shipbuilding plan at the request of the Subcommittee on Seapower and Expeditionary Forces of the House Armed Services Committee.
Over the past several years, the nation has experienced its most severe financial crisis since the Great Depression of the 1930s. To stabilize financial markets and institutions, the Federal Reserve System used its traditional policy tools to reduce short-term interest rates and increase the availability of funds to banks, and created a variety of nontraditional credit programs to help restore liquidity and confidence to the financial sector. In doing so, it more than doubled the size of its asset portfolio to over $2 trillion and assumed more risk of losses than it normally takes on.
CBO and the staff of the Joint Committee on Taxation (JCT) have prepared an estimate of the budgetary effects of H.R. 4213, the American Jobs and Closing Tax Loopholes Act, as posted on the Web site of the Committee on Ways and Means on May 20, 2010. CBO and JCT estimate that the legislation would increase budget deficits by about $123 billion for fiscal years 2010 and 2011, by about $141 billion over the 2010-2015 period, and by about $134 billion over the 2010-2020 period.
CBO has a panel of economic advisers that includes many distinguished economists (some of whom are former CBO directors). We host periodic meetings of the advisers at our office and solicit the advisers’ views between meetings via email exchanges and phone calls. Through these interactions, we benefit from the advisers’ understanding of cutting-edge research, current economic conditions and the economic outlook, and economic policy. As a result of the advisers’ comments, the quality of CBO’s economic analysis is greatly enhanced. The advisers for 2010 are: