Pro-Growth Budgeting Act of 2013

Floor Speech

BREAK IN TRANSCRIPT

Mr. McCLINTOCK. I thank the gentleman for yielding and for his kind words.

Mr. Chairman, the question before the House is whether we are going to continue to ignore the economic consequences of the major actions that we take or whether we are going to start recognizing that incentives matter and that the legislation we pass has profound economic consequences that must be taken into account.

Why does Amsterdam have the narrowest houses on Earth? It is because they tax by street frontage.

Incentives matter.

What happens to our revenues if we tax all of a person's $100,000 income? The static scoring on which we now exclusively depend says that that would raise us $100,000, but we all know the correct answer is that we would raise zero dollars because that person now has no incentive to work.

Macroeconomics gives us tools to anticipate the real-world effect of major policy changes, and we ought not to be blind to them. It is not perfect, but it comes far closer to the mark than does a static model that assumes that people are mindless automatons whose behavior never varies despite major changes in the economic environment that our laws create.

This measure doesn't presume to tell the CBO how to do its job or what formula to use in its analysis. We will still get all of the static scoring the same as before, but on major legislation that greatly impacts the overall economy, this bill says: give us the complete picture. If a proposal is going to affect the economy by more than a quarter percent for good or ill, then tell us. Tell us what you think, and show us why you think so.

For too long, Congress has blundered from one economic policy to another with its eyes wide shut, and it is time we got the complete picture and took into account the real-world consequences of our actions.

BREAK IN TRANSCRIPT

Source