U.S. Senators Kelly Ayotte (R-NH), Marco Rubio (R-FL), and Ron Johnson (R-WI), today introduced legislation aimed at providing better assessments of the macroeconomic impact of major pieces of legislation. The Pro-Growth Budgeting Act (S. 1996) would require the Congressional Budget Office (CBO) to provide a more dynamic analysis of how proposed legislation could affect major economic variables, such as real gross domestic product, business investment, and employment. The Senate bill is the companion legislation to H.R. 3582, which was introduced in the House by Reps. Tom Price (R-GA), Paul Ryan (R-WI), and Scott Garrett (R-NJ). Under current law, CBO performs cost estimates on how legislation will impact federal revenue, outlays, and the deficit. However, CBO's cost estimates currently do not provide lawmakers with a clear picture of the positive and negative impact such legislation could have on economic growth.
"By providing a more dynamic assessment of how legislation will impact the economy, the Pro-Growth Budgeting Act will help Congress make more informed decisions on policies that have real consequences for American families," said Senator Ayotte, a member of the Senate Budget Committee. "This bill is a commonsense step toward creating a more accountable, transparent, and responsible budget process."
"The Pro-Growth Budgeting Act will help policymakers make better informed decisions about how major legislation will impact our economy, and it will provide the public with better information," said Senator Rubio. "At a time when unemployment remains high, Members of Congress need to have a complete understanding of whether legislation we consider will help or hinder economic growth. The Pro-Growth Budgeting Act is a big step in that direction."
"America's fiscal and economic health have both deteriorated badly in recent years. Under President Obama, we've lost 1.6 million jobs, and we've run three straight years of deficits over $1 trillion," said Senator Johnson. "Congress needs the best available data as it addresses these serious challenges - and the Pro-Growth Budgeting Act provides that. It gives Congress a better understanding of the effects of major legislation on Gross Domestic Product, employment, labor supply, and other factors."
Congressman Tom Price, M.D. (R-GA) said, "Senator Ayotte along with her colleagues Senators Rubio and Johnson are showing strong leadership in introducing the Pro-Growth Budgeting Act and agreeing to be a part of this effort to advance a budget reform process that will make Washington more accountable. Members of Congress would be well-served by a broader and more informed, real world assessment of how legislation will affect business investment, economic growth, and job creation. The current broken budget process incentivizes overspending and gives lawmakers ample opportunity to avoid making tough decisions. We can and must fundamentally change how Washington operates and ensure the government is a better steward of taxpayer dollars."
Highlights of the Pro-Growth Budgeting Act:
* Requires CBO to supplement its traditional cost estimates with a more dynamic assessment of the impact "major" legislation would have on the economy;
* The assessment would include an analysis of major economic variables, such as real gross domestic product, business investment, capital stock, employment, and labor supply;
* The assessment would also report on the potential fiscal effects of legislation, including any estimates of revenue increases or decreases resulting from changes in GDP;
* The supplemental macroeconomic analysis would cover three ten-year periods;
* "Major" legislation is defined as any bill or resolution with budgetary effects estimated to be greater than .25 percent of the current GDP.