do you have an estimate of what portion of the 14 trillion in the current baseline is unauthorized. the last testament we did was 2016 was a pretty large number about $310 billion we have not updated the estimate. i think will be interested in that number anyway. it made the corporate rate permanent. and show the u.s. as a competitive market. dr. holt does it encourage firms to locate those domestically.

the overall effect is to make it more appealing location my time is expired. dr. sanders. the tax cut bill would pay for itself. on page 128. they project that the tax plan

will increase the deficit by $1.5 trillion over the next 11 years. at the end of how many hours hearing about the benefits of trickle-down economics. tax revenues will increase to overcome the deficit. present trump among others has claimed the rich will not be gaining at all with the tax plan. the good of the top 1%. and 60% is that roughly

accurate. what we're talking about is a tax plan that significantly grows the deficit in almost all of the benefits i don't know if you've even seen it. but it came out literally from today. they have seen zero wage growth. over the past year after adjusting for inflation. in march of 2017 in march of

200018 what i would say talk a little bit about income and inequality. is it true based on your understanding that the three wealthiest people in this country now on -- own more wealth than the bottom people. i do have them numbers in my head. my colleague butcher would talked about social security and medicare. they introduced legislation that would lift the cap on the

taxable social security income. everybody is concerned about the financial future of social security. according to the social security administration. administration. if you lift the cap on income of $250 or more which is just the highest income earners in this country. so security will be solvent for the next 60 years. we can include -- increased benefits. does that sound right to you. >> i don't know if that is true or not. for all people who are concerned about the solvency and social security the answer is not to cut benefits but massive income and wealth

inequality. so that we can protect the many millions of people today who are struggling to keep their heads above water. it might be worth a hearing on this. you've a lot of elderly people cutting their subscription costs in half. in terms of poverty among elderly people in this country. it is to be strengthening those programs. thank you for your work. sorry there is such a bleak picture painted having the

public that go from a 78.296 percent of gross national product is not very good news. i hope a congress thinks about the impact on our children and grandchildren. with that debt and deficit my colleagues on the other side of the eye out aisle want to make this all about revenue in the historic tax cuts that we reenacted. in your exchange with the chairman. my first question is kind of carrying on where the chairman left off is it not accurate based on your analysis that would lead to lower

unemployment. the increased hours worked. and capital can investment. i have to conclude that when democrats say they wanted to repeal tax reform for a really are really telling the american people they want fewer jobs and more wages. based on your analysis how would allowing the individual tax reform impact the economy. we think that would be the opulent -- of the opposite of stimulus. some of things like the tax rates don't expire and continue to give you an idea of that. instead of asking a question unless you disagree with this percentage i'm going to say that revenue as a percentage of gdp as averaged 17-point 4%

over the last 50 years according to your analysis what would revenue as a percentage be in 2025 which is prior to the expiration. it's even better than what i thought it was can be. so even with the tax cuts enacted last year. fully in effect. revenue as a percentage will exceed the historic average. i was looking at the next year. is it correct that over the past 50 years that it's

averaged about 20.3 percent of gdp. and what do you predict spending over the next ten years. it's something north of 21 percent. i think quite a bit north. i don't know if these figures come from you. but i had 22.4. in 28. and what are the primary drivers of spending growth. as things like medicare and medicaid. i think i agree with that. i don't know whether these percentages are accurate.

they take up 12.9 percent of gdp today and that that's can up to 14.9% the part that we appropriate every year. even with tax cuts will remain on par with historic averages. it said to increase hysterically over historic norms. our focus needs to be on the spending side particularly mandatory spending programs. dr. hall, good to see you again. your professionalism is always appreciated. here in this room a bipartisan tax reform bill was produced by then chairman judd gregg.

i was proud to be one of the sponsors of it. our approach would've put them bulk of the tax relief into the pockets of the middle class rather than the multinational corporation. and decided to put the massive tax cuts on the national credit card. let me keep you clear up politics and let's just walk through a couple of numbers so we could be clear about this. in the updated outlook you estimate that the trump tax law is going to increase the deficit by almost $1.9 trillion over the budget window even after taking economic feedback nearly $600 billion of that cost so

here's my question. with the medicare and medicaid. i don't know where else republicans can possibly go to pay for this 1.9 trillion dollars in debt virtually to go to the multinational corporations. when i stripped the budget down it seemed to me the cutting the defense budget would be the only other realistic option. i don't want to make recommendations i suppose i just want to hear maybe they

could cut everything discretionary and we would lose the prospects of research. but basically other than the defense department and cutting that warehouse with the go or could they go. it gives you a little bit of insight right now in interest alone is about 1.6 percent of gdp. that number is can a triple. that will become about 3.1 percent of gdp. that is bigger than all of defense spending my point is that the interest cost is starting to exist.

it's whatever it's good to be and needs to in needs to be something that is pretty big. i'm just looking at three ranges of numbers. when you have that amount of debt and this is were i where i think they are going. i base that on their budget proposal for this year. then i think you could wipe out the discretionary budget nih i can't see any other budgetary real estate can you give me some examples for

other possibilities and what i've mentioned. even that is the is under estimating the problem because that is just the interest cost. we then have a huge amount of debt running out there. i think then the problem is even more extreme than that. you've certainly made a very good point with respect to that debt. but when the growth projections are nowhere near what was promised number one the middle class aren't seen what they were told they were to get which is a $4,000 pay raise in the middle class. it drives 70% of the american economy i don't see how growth

is going to get you close to paying for that 1.9 trillion dollars that was put on the credit card and it still leaves us with the safety net in defense unless you want to cut the defense programs. i look forward to talking to you about this. i certainly share your view about the debt. thank you all for being here. this has nothing to do with our leadership. i find this to be the least serious committee that we serve on. thank you for being here today. and it seems like it's always up partisan who's ever in charge tit for tat. none of us had covered ourselves in glory. this congress and this

administration likely will go down as one of the most fiscally irresponsible administrations in congress that we've head. we did not finish the work by making the cuts that needed to be made. i don't have anybody here was. we did not finish our work and so we ended up with the sequester. it was the best vote that i have made and that we at least domestic spending for a. of time you have talked about the cost of this tax bill and if it ends up costing what has been laid out here it could will be one of the worst votes i have made. i hope there's other data to assist whether it's jobs or growth or whatever.

the thing that has never talked about here. with a bipartisan budget. my group just did an analysis on my partisan budget agreement that we just passed. it have just happened. i think the tax bill could get 1.9 train dollars over the next nine years. would you say that what we did in fairness passing the spending bill we just passed we do have a bit of an estimate. i think the ad to discretionary spending from those two bills is about six and hundred $50 billion over ten years.

they combine to add about $650 billion to the deficit over ten years. that is under current policy. $650billion in debt with current policy. about $305 billion of that is from exceeding the caps. we added hundred $50 billion into the baseline did we not. we just added hundred 50 billion to the baseline.

it is going to be in the true -- 2 trillion range. if you look at table a1 we have the change in our budget forecast since it due june 2017. and that goes into discretionary outlays you will see we have a forecast here. about six or $50 billion. if you keep current policy in place. i want to follow up with you on that. you just do the math hundred $50 billion to the baseline you multiply it by ten a cannot be accurate. the point is that we've had both spending that has increased the deficit in tax

reform that has increased the deficit. over the last 15 months. i think they did not agree with the priorities of in this bill. there is only three that have it participated in that. i voted against the spending. some of you voted against the tax bill. both sides of the aisle are totally remiss as it really meets to deficit. i listen to this bickering and blaming a people. we are not capable of dealing with our country's finances and of course a big part of it is american people the thing

that is confusing to me as i notice on page 117 yet the growth at .7% the tax reform bill. i'm just confused as to whether that is just a seven tenths increase in the baseline and there really isn't that much of growth i'm confused over that. i know my time is up. we think of gdp on average it would be seven tenths higher over ten years.

i want to start rethinking you and your team for the nonpartisan professional work and as your report clearly indicates the claims that the recent tax cut would pay for itself is pure fantasy. you indicate here that even with additional economic growth the debt will increase by $102 trillion both are measures of our economy but in my correct insane that the growth national product is a better member -- measure of income. it focuses on where things are made.

to the extent that the republican tax law boosts its because some of that income from income economic activity is flowing to foreigners instead of america. one of the big reasons is one of the big increases in borrowing. it's coming from abroad. it's also a fact when you look at the stock of american companies 35 percent of that is currently owned by foreigners so when there is a stock buyback that is money that flows directly into the pockets of some the overseas. if you dig into your report you find by 2028 that the

gross domestic product that the gross domestic product but the gross national product may only .1 percent. doesn't mean that roughly 80% of the income from the increased activity of the tax plan in the final year it's fivr rate. to be clear 80% of the benefit of economic activity is going

in the pockets of foreigners. eighty sense of that is there. it's going into the pockets of foreigners. let me ask you about it. let me ask you about two parts of the plan that i tried to spend a lot of time on the floor wanting my colleagues about. you are familiar with that piece. and then there is another part that's a deduction for profits for foreign sales which they called the fdi eye.

on page 109 of your report you state by locating more intangible assets abroad a corporation is able to reduce the amount of foreign income by locating fewer tangible assets in the united states. as amount of income that can be deducted. it may increase corporations to locate chain tangible assets. talk about plant and equipment and that kind of thing. part of what we were doing that was pointing out that it was very complicated. your financier are consistent with that of a lot of economists. this provision and the way it was written creates this prefers incentive to shift jobs overseas.

and if a corporation does succeed by moving and factory overseas then they are effectively getting a tax break. the investment in the united states. part of the investment we talked about this from foreigners. in the year 2028 there getting 80 cents of every dollar of increased income. more profits for foreigners and a bill that was sold as something that was can help the american worker. would you agree that as a tax expenditure. it's not our call. they will follow up with that.

we rely on the jc tea. with the government program that encourages people to move plants and equipment in equipment overseas. i think you. there has been a lot of talk so far about the macroeconomic picture. let's bring it down to the micro picture. historically the unemployment rate will be low. an increase in hourly wages. the bidding up of wages as necessary to attract new employees. what are the policies and fostering that competition and leading the increase in hourly wages. where ending with that in our economy. we've a lot of stimulus from

the tax act. it's really pushing gdp growth. and does that mean that some of the gains from that growth whatever it may be will accrue to a greater degree to labor than it will to capital's interesting wage increases. they actually see a decline in a marginal tax. given that labor for many decades now especially low skilled laborers people who are getting out of high school and going straight to the workforce. i also think one important policy that you would need to continue his immigration enforcement. when you take a look at the immigration levels because obviously we could increase our abstract gdp simply by bringing in millions of more workers.

and the more productivity or more workers that wouldn't necessarily be good for america's families. i want to turn out to something that i did not see in your report. i did not see much if anything about national defense and military spending. did you not put much focus there. i think we didn't put a ton of focus. i want to make the point that i don't think our military is responsible for driving much of the deficits. in part by not discussing the increased military spending. this year or next year. as your report makes clear the long-term debt picture is driven by retirement especially healthcare spending and i would even make the case that long-term military spending is essential for

controlling our deficit and ultimately our national debt. it creates international system the international system in which our economy operates. in to international trade and investment. the trade expansion has produced roughly 2.2 train dollars in gains. that translates into more than $7,000 per person and more than $18,000 per household. then i have the great power contact. it studies the effects of war on trade. with the trade in the long-term directly involved.

of up to 10%. it has been patrolling the seas. forcing our allies to mediate their differences. so the small conflicts don't rise into big conflicts. from the kind of adventurism that launched us into world war ii we spent a lot on our military. many of the closest nations combined. that's in part because military competition is so destructive. therefore we can't afford to skimp on it. i took that to be the message of the absence in the most recent support report and the testimony. the military is one of the most fundamental things our

government spend taxpayer dollars on. we to continue to do so. good morning. i reviewed the outlook for the next decade and i'm deeply concerned about the increase to the deficit as many members of this committee had expressed. it will add nearly one point $9 trillion to the deficit. according to the cbo analysis it will exceed the size of the economy. two years sooner than you forecasted in june. it is created by a massive giveaway to the wealthy and corporations and by making the individual tax cuts expire in 2025 while making of the corporate tax cuts permanent.

this was appear a pure giveaway to the corporations. and when congress talks about how we fix the deficit increase some of my colleagues on the other side of the aisle discussed it a need for entitlement cuts. it really means cutting medicare and medicaid and social security and means cutting the main programs 4.4 million seniors. my constituents retiring with the dignity means being able to afford their prescription drugs. not living paycheck to paycheck and having the peace of mind that government will not take away the benefits promised to them. at a time when somebody seniors cannot afford their life-saving medication we need a budget that allows a medicare to negotiate drug prices. what we don't need is a budget

that cuts $500 billion from the program over the next decade when trying to repeal the affordable care act congressional members proposed cutting medicaid by $700 billion. nearly two thirds of cal 40 seniors and an average of $21,300. with cut social security millions of seniors would struggle to make ends meet. when we discussed balancing the budget we need to speak the truth that this tax plan has blend the deficit for the purpose of delivering billions of dollars to the top 1% while putting access to affordable healthcare and a shot at a decent retirement at risk for anyone else. my question is based on the updated budget outlook. can you tell me whether the

effects of the tax bill either directly or indirectly impact the future solvency. >> certainly anything that adds to the deficit in the debt is can have an impact on things going forward. we get a little boost in economic growth. that might extend the exhaustion dates. but the basic problem is still there. and the basic issue of the debt getting to an unsustainable level as may be more intense than it was before. will you agree that it will have a disproportionate impact. >> is certainly changes in medicare and that's where it would have a disproportionate effect. thank you mister chairman.

thank you very much for coming and in bringing your expertise to bear on her economic situation i was looking at numbers from the joint committee on taxation which laid out 17 out of every $20 in the benefits from that the tax reduction goes to richer americans that did not include the estate tax. what is your analysis that goes into more than to more than a hundred thousand dollars. we have not updated those numbers. we which i'd reproduce that. i can tell you anything different than what they head on the topic and would you

agree if you include the state tax the numbers would be even worse. something that was sold as benefit all -- beneficial middle-class is actually beneficial to the best. and it brings me to the second point which is your analysis shows that from ten months ago until now the annual deficit has grown from an estimated $563 billion. if it extends over ten years i think your numbers were about 1.6 million dollars. i'm just additional on top of the baseline that existed ten months ago. see my cow much of that is that tax bill and how much of that is a spending bill.

the tax bill is a big part of that. i think the tax bill i can tell you the spending part of it. the spending part is actually 40 to 45% increase. it is a pretty significant part. more than the remainder is the tax bill. that is funded through borrowing. essentially we have a bill that has borrowed our children to deliver the best -- the

vast bulk of the benefits of the richer americans. is that a fair reading of the numbers. it depends on who winds up fixing the deficit i suppose and bears the burden about how congress decides to deal with it. but the delay is certainly pushing it back in time. under president carter we have essentially him closing out with the same deficit that went for the year before. under president reagan the increase from 73249 or roughly doubling we have another near doubling.

we were reducing our national debt. the second we had increased from 236 to 458. the results of the recession were first year in office it. why is it that the deficit decreases under democratic leadership speemac i would not want to offer an opinion on that. that sounds right. i do think it is important point to make because what we have seen for a pattern that has increased our debt vastly. it has repeatedly taken us

deep into the red. democratic leadership has reduced that image and yet all we hear from our republican colleagues is how they are fiscally responsible. how can one square the rhetoric with the reality. i'm glad you confirmed my numbers were accurate. i will disclose by saying our children are now financing the biggest theft of money and this is what you normally see in corrupt irresponsible third world governments not the united states of america. i just wanted to draw your attention to page 33 of the report.

changes to trade agreements or tariff policies on the part of the united states and the trading partners. could have significant adverse effect. where as the removal of trade barriers between the united states in the training partners could include aggregate economic conditions. we have a hearing recently with the have of the celts appeared before us. it was after president trump have indicated he was going to impose tariffs i ask at the time based on my understanding that the number of workers in american industries that make aluminum and steel is dramatically smaller than the number of workers that work in american industries that make things. i ask his economic opinion on about the tariffs and whether

they will be a plus or minus for american workers and he said the economic literature would suggest that just looking at it that way before you get into retaliation discussion. i do. and then if we get into the subsequent retaliation issues. they matter a lot. they are buying aluminum for cans. a plant that is the only manufacturer of volvo trucks. it's good to raise their cost rates. over the course of the last couple of weeks. a lot of concern in virginia on the egg side.

especially with respect to things like soybeans in pork and other agricultural products are very challenging to virginians. talk a little bit about it. have you started to do any analysis of what what would the effect be an american workers and american farmers. our economic forecast closed about mid february. we haven't really taken any of that on board. certainly that is a sort of thing we would pay attention to and see how things turn out. at a later date next time we do it. you did generally agree with the way that the conclusion was made that the imports tariffs were negative and positive american workers.

as i can be a net good or not to bad in terms of the workforce. to be fair. the real solution how it winds up. i do think a lot of the concerns i find them interesting because they are the inverse of the benefits of trade. having trade negotiations and agreements. you can have lower prices and lower cost of production. you could have access to foreign markets with good trade agreements. i'm doing this can have the reverse effect. again to be fair we have to kind of see where we wind up. some of the retaliation discussion is still at that rhetorical level. the retaliation discussion are

rhetorical right now. and we don't really know what kind of tariff changes the u.s. is likely to make. i will just conclude and say i think it's interesting the constitution gives congress we delegate to the president through fast track. i think it's interesting that we want over the trade deal. even though the constitution suggests that it is ultimately for congress. i don't think a president should be able to do a trade deal or a trade war i hope to work with my colleagues to come up with some improvements

in the process so that there can't be a funeral lateral executive. that is just my opinion. thank you mister chair. it looks like i am bringing up at the rear here. it's just down to us in dr. hall. you've talked about the healthcare spending projections graph. and this is the one that i had used before but guess what. we've a new one. and as for the record back here when the affordable care act passed they did the yellow line estimate of what it was supposed to look like.

it came in below what was expected this is the actual time. in the graft that i used to use all the times. it was $.3 trillion in savings. in the expected spending and the new projection. in this. the number goes up to $4.2 trillion. now, i believe that about 300 billion of that relates to the repeal of the individual mandate. you can backed that out but it

still leaves 3.9 trade dollars in savings up from 3.3 trade dollars in savings just in the intervening year. at the get is important to try to do whatever we can to try to figure out. what is going on here. i ask you to keep working with us. this has a particular emphasis now because as you know they are trying to reform the budget process. no one has been more eloquent in understanding how broken our existing process is. it's one of the areas where he and i have considerable common cause. one of the ways that we need

to fix our existing broken budget process is we need to have all of the elements that mathematically added to the debt to be considered in our budget process. not just appropriated spending but also healthcare spending or tax expenditures or revenue. as a general proposition do you agree with me that those are the four key elements that lead to our death in -- deficits. if were to look at healthcare. we really need to start looking at ways to address this. i completely disapprove of and will fight to the best breath. there are better ways to achieve savings we are seeing some remarkable results.

with accountable care organizations. and it's very hard to extrapolate from coastal medical in the state of rhode island a provider practice that is now increased it by $700 while dramatically improving the experience in the care that their patients get to $3.9 trillion in savings i suspect that there is something going on out there. as we improve the payment system for the healthcare at a price and prescribing things to people and see people than it is to doing things that keep people healthy.

do you concur with that as a general thought. and when you keep working with us. is there any ways that we can be helpful to try to figure what is working that has made that difference in this time. we are interested in that time. we are trying to do some work on that. i know you are interested beyond that. we keep having to lower our estimate of healthcare cost and growth. we could give you a better forecast of future cost. what we are doing. i know my time is expired. may i ask an additional question.

a coastal medical or medicare physician or provider group. where we are actually seen the cost not go up so fast but driving the cost down for their patients. what is that look like from your perspective. it certainly where we start working on this. they can understanding of what is happening with individual providers. that is certainly going to be part of our methodology. while providing better care for people that would be a pretty serious win-win. i think you for your comments. the last hearing regarding that. and then sharing the information that you did with me.

to get more detail on how it actually works. i think you for your work on that special budget tax force as well. as you did working bipartisan before. if we can fix that process. we are much inspired by you. they are doing their best to channel their concerns and their wishes to the process. i wanted thank you dr. hall for the testimony today. all of the documents that you oversee the preparation appeared in the full statement will be included in the record. they are due by 6:00 p.m. today.

under our rules in our witness. they had seven days from receiving the question to respond with answers. the hearing is adjourned. david cameron testifies about global security. c-span where history unfolds daily. in 1979 and today we continue the supreme court in public policy events in washington dc

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