Washington Reined In 2024 Spending By ‘Only’ Burning Through $1.9 Trillion More Than It Brought In
Lawmakers’ unabated desire to spend money we don’t have jeopardizes our national security — and our future.
The Congressional Budget Office released a worrying report on Wednesday, warning that economic growth will slow down in 2023.
The CBO is adjusting its economic growth outlook for 2023 based on several factors negatively impacting the economy, including high inflation, high interest rates (a direct result of inflation), and dizzying employment figures.
"According to CBO’s current assessment, economic growth will probably be slower in 2023 than the agency projected in May 2022, reflecting recent developments (including higher interest rates), and faster in 2024, as the economy recovers," the CBO explained in its report.
"Rates of unemployment, inflation, and interest will probably be higher over the next two years than CBO projected in May 2022," the report added. "Slower economic growth and higher rates of unemployment, inflation, and interest increase federal deficits and debt."
Overall, the report coheres with economists who believe that despite Q3 GDP growth, the U.S. economy could contract next year.
"From the fourth quarter of 2022 to the fourth quarter of2023, CBO estimates, there is a two-thirds chance thatgrowth in economic output—specifically, gross domesticproduct adjusted to remove the effects of inflation, orreal GDP—will be between −2.0% and 1.8%," the report explained.
While the CBO report does not say anything about a recession, economist Tiffany Wilding of investment management giant PIMCO explained this week that her firm still believes a recession will happen despite 2.9% GDP growth in Q3.
"Core growth has decelerated quite a bit and that’s even before you're really starting to feel the effects of [Federal Reserve] policy and Fed tightening because that works with a lag," Wilding said on CNBC
"So we do think the economy slips into recession next year under the weight of the financial conditions tightening," she said.
Rep. Jason Smith (R-Mo.), the top Republican on the House Budget Committee, said the CBO's report is evidence that President Joe Biden's policies are failing Americans.
"This report shows that unless better policies are put in place to strengthen America’s economy, grow jobs and wages, and rollback reckless spending, Americans will continue to feel the effects of the Democrats’ failed economic policies for years to come," Smith said in a statement.