Experts are divided into registration methods of the Trump bill and spending

Like Republicans in the House of Representatives to pass the president Donald Trump The Tax and spending bill has encouraged only the budget office in Congress (CBO) only from the discussion-the armament of both sides with a new amulet in a already bitter financial battle.

The Central Bank of Oman provides an estimate of cost or saving over time and what it will do for the federal deficit and the total local product in the country (GDP).

However, how CBO is offered these numbers in a long -term discussion center in Washington, because these estimates often become the top of the spear in the party war.

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With some warnings, Republicans often pressure the dynamic scoring to emphasize the expected economic growth of tax cuts or standard cancellation, while Democrats tend to prefer fixed registration to avoid optimistic expectations that may never be achieved.

At the heart of this gap, each method is the economy models: fixed registration provides a shot in a timely manner, while the dynamic registration aims to capture a more liquid narration similar to the video of economic ripple effects.

Since both approaches depend on predictions and assumptions, they provide a wide space for legislators to choose expectations that suit their political arguments.

In addition to the Central Bank of Oman, organizations such as the tax institution, the Joint Taxes Committee and the Warton School at the University of Pennsylvania are issued fiscal policy reviews. Experts say that although the numbers in these estimates may vary, many basic models are very similar.

“It seems that we have all bought the same model and car model, but with a little different trim packages,” said Richard Stern, Acting Director Acting of the Secondary Heritage Foundation for Economic Policy Studies.

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Stern added that the average estimates can provide another useful perspective in understanding the potential impact of the draft law.

In the midst of these models, there is a major gap: whether it depends on fixed or dynamic scoring – a completely different approach to predicting how politics changes through the economy.

Comparing fixed and dynamic registration

CBO says that the “Big Beauty Bill” Senate will add a little more than $ 3.4 trillion of budget deficit during the next ten years. To get these numbers, CBO generally uses a fixed method of registration in my modeling. Fixed registration is clear, direct, more predictable and less guess.

However, it is assumed that behavior does not change in response to politics. For example, if Congress reduces taxes, the fixed model simply indicates the lowest revenue. The model does not pick up a scenario in which people may work more or invest differently due to the low tax rate.

The alternative is a dynamic registration method – it is usually preferred by Republicans.

Dynamic registration appears to include behavior in its discipline to draw a broader image of how to form a policy for the public economy. Factors such as changes in investment, employment offer, interest rates and tax revenues are considered in this method.

The Dynamic Registration of the Tax Corporation estimates that the “beautiful big bill” will add $ 2.9 trillion to the federal deficit over 10 years.

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“Ideally, we must look at both,” said Adam Michel, Director of Tax Policy Studies at the Washington Institute.

“It is fixed to understand the effects of the direct and dynamic budget to understand the broader economic effects,” Michel said, adding that “transparency and a set of estimates are important.”

One of the main differences in the Wharton School model is that it does not use the CBO foundation to make its expectations.

Kent Smetters, professor of business economics and public policy at Wharton, explained that almost every other group uses the personality of the Central Bank of Oman as a starting point for its estimates. He also described some modeling in Washington as “divorced from the main economists.”

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Meanwhile, the Trump administration criticized the evaluation of the Central Bank of Oman that the tax spending bill and spending on the president will add trillion dollars to Federal deficit. The administration specifically called on the basis of the Central Bank of Oman for its expectations and its failure to consider the Trump extension 2017 Tax discounts.

“They cannot see the forest of trees,” the director of the administration and budget office Ross competed He said, adding that CBO is using the “artificial foundation line” for his estimates.

“They assume that all spending is eternal, but the tax exemption in 2017 was on sunset, and as a result, when it only extends to tax relief, you are in a situation that appears to be the main cost, and of course, this is not a cost,” said Vogue “Fox News Sunday.” Shannon Brem.

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In June, White House press secretary Caroline Levit described the Central Bank of Oman as “an institution in our country that has become partisan and political.”

She previously cited the expectations of the White House Economic House as an alternative to CBO numbers.

According to the Economic Advisors Council, Trump’s tax and spending measures will produce “real economic growth and the restoration of the financial mind.” The White House agency prepares the GDP by 4.6 % to 4.9 %, an increase in investment reaches 10.2 %, and an increase in the economy by 5.2 % in the first four years of passing the bill.

The White House also said that the Trump bill “does not add to the deficit” and will already save more than one trillion dollars through spending discounts.