A new report by the non-partisan Congressional Budget Office reminds legislators that tax increases and spending cuts set to take effect automatically in January threaten job growth significantly in the coming year. But for the first time, CBO has analyzed (PDF) the economic consequences of specific provisions within the sequester. And it turns out the least harmful component of the coming fiscal consolidation is precisely what Democrats are demanding: the expiration of the Bush tax cuts for high earners.CBO doesn’t examine the top bracket Bush tax cuts directly. But it does look at two competing scenarios: One where all of the expiring tax cuts except for the payroll tax cut are extended; another where all of the expiring tax cuts except for the payroll tax cut and the Bush tax cuts for top earners are extended.
This is a companion discussion topic for the original entry at https://talkingpointsmemo.com/?p=93808