>>> Max Sawicky <sawicky at epinet.org> 07/29 5:18 PM >>>
>I have to agree with Doug here, although I am curious about one thing. Has
>there been a history of pessimistic growth rate predictions by the gov't,
>or is this something new?
There's no single "govt" prediction.
In the early 1980's, Reagan Administration
predictions were optimistic. This facilitated
the implementation of tax cuts. CBO tended to
be pessimistic, as did one of Reagan's advisors,
Martin Feldstein. Optimism proved the rule over
the 1980's, as a sequence of 'balanced budget'
plans were rolled out and collapsed. In the
1990's, predictions began to prove pessimistic.
>From 1990 to 1994, CBO tended to be more
pessimistic than the White House (either one). Since 1994, CBO's optimism has rebounded, which by sheer coincidence facilitates tax cuts by the Republican majority.
Optimism is now at an all-time high, which happens to give Congress 1.5 trillion of budget surplus to play with over the next ten years.