The Need for Macroeconomic Analysis

  • We can’t build a healthy economy if we don’t even know how our decisions affect the economy.
  • That’s why we have two nonpartisan organizations that do cost estimates for every bill we consider: the Congressional Budget Office and the Joint Committee on Taxation.
  • We’re asking CBO and JCT to give us the best information they have.
  • We’re saying, “If you think a piece of legislation is going to have a big effect on the economy, then include that effect in the official cost estimate.”
  • So if you think a bill is going to help or hurt the economy, then tell us how much you think it will increase jobs, tax revenue—and vice versa. We need to take that into account.
  • The people who prepare our cost estimates are the best in the business, and they’ve been working on this issue for years.
  • In fact, they already do this sort of analysis; we just don’t include it in the cost estimate.
  • And we should—because when we look at a piece of legislation, we need to look at it the way our constituents would.
  • We need to understand what it means for jobs, wages, and the economy at large.
  • We’re doing this so we can change the focus in Washington.
  • Because when we consider a bill, we shouldn’t focus on the top line—whether it’s good for the government.
  • Instead, we should focus on the bottom line—whether it’s good for the taxpayer.

Description of the Rule

  • The rule would modify an existing House rule to require CBO and JCT to include an estimate of the macroeconomic impact of legislation in their cost estimates.
  • The rule would apply only to “major legislation”—that is, legislation that would be significant enough to materially affect the $17 trillion U.S. economy.
  • The rule would apply to both mandatory spending and revenue legislation.