doug elmendorf briefing reporters on his outlook. just getting under way and live here on c-span. we estimate that the federal government budget deficit this year will be 1.1 trillion dollars, which equals>> 7.3% of the economic output, down from about 10% in 2009. this is the force year in which the deficit has exceeded $1 trillion. federal debt will reach 73% of gdp by the end of this fiscal year, the highest level since 1950, and about twice since 2007. we are prepared baseline projections that reflect the assumption that current laws remain unchanged. they are designed to serve as a benchmark in considering changes. substantial changes to tax and spending policies are scheduled to take effect at the end of this year under current law. whether lawmakers will allow those changes to unfold will play a crucial role in determining the path of the federal budget and the economy. we have prepared projections under an alternative fiscal scenario. many policies will be this is down from 10% in 2009. this is the fourth year in a row in which the deficit has exceeded one trillion dollars

take a listen to the dire projections from cbo director doug elmendorf. >> i think what we see coming next year under current law, is a very large amount of fiscal tightening, larger reduction in the deficit relative to gdp than we've seen any year since 1969, and that is sufficiently large shock, negative shock to the, demand for goods and services next year, to push the economy into a significant recession. sandra: so how realistic is the cbo's outlook? with me here to break down the cbo report, dr. art laffer, former economic advisor to president reagan. thank you for joining us. >> thank you, sandra. a pleasure to be with you. sandra: do you agree with this? this was a pretty dire forecast from the cbo, this fresh fiscal cliff warning. do you agree? >> yikes! i think he is right. i don't think it is a fiscal cliff. i think it is really a tax cliff. you have a huge tax increases coming on january 1st, 2013 as glenn hubbard just said. i never heard, sandra, never heard of an economy tax understood prosperity. if you tax people who work and give that money to people who don't work yo

. >> bret: doug elmendorf talking about what happens at the end of the year.cting today deficits for this coming fiscal year, 2019, to be $1.1 trillion. as you take a look at the graph, deficits under president obama. this is a president who vowed to cut the deficit in half when he came to office. he will see it exceed $1 trillion according to the cbo for the fourth straight year. as you take a look at the next graph, this is essentially what elemdorf is talking about. if the current law stays in place, the a terptive fiscal scenario, there you see everything stays the same. they pass everything to stay the same as it is right now. the deficit is roughly $1.1 -- that should be $1.1 trillion, not bill should be $1.1 trillio. the growth, gdp is 1.7. unemployment at 8. the 2012 baseline is really what happens if the sequestration goes in to place. this is at the end of the year. if the tax cuts are not extented, the bush era tax cut, then you see the deficit go down, growth go in the negative. and unemployment shoot up. again, that is $641 billion and $1.1 trilli

doug elmendorf briefing reporters on his outlook. just getting under way and live here on c-span. >> 7.3% of the economic output, down from about 10% in 2009. this is the force year in which the deficit has exceeded $1 trillion. federal debt will reach 73% of gdp by the end of this fiscal year, the highest level since 1950, and about twice since 2007. we are prepared baseline projections that reflect the assumption that current laws remain unchanged. they are designed to serve as a benchmark in considering changes. substantial changes to tax and spending policies are scheduled to take effect at the end of this year under current law. whether lawmakers will allow those changes to unfold will play a crucial role in determining the path of the federal budget and the economy. we have prepared projections under an alternative fiscal scenario. many policies will be this is down from 10% in 2009. this is the fourth year in a row in which the deficit has exceeded one trillion dollars. federal debt held by the public will reach 7% by the end

one of them is doug elman north --elmendo --elmendorf. the congressional budget office is a remarkable institution. one of the few institutions in washington that works the way it is supposed to work and is functioning. it was created largely in rebellion of the congress trying to take control from richard nixon to give them independent advice and honest figures on the federal budget, federal spending and has done just that. elmendo elmendorfso is trying to talk sense into his boss's. fortunately he is not paid for performance. he said a couple things i think are relevant. one is we cannot go back to the spending policies of the past because the number of people 65 and over will increase by one third off between 2012, and 2022. the number of people over age 65 will increase by 1-third over the next ten years. that is the aging of the baby boom. the idea that we fix the budget deficit, do something about medicare before the baby boomers start collecting it is over. the oldest baby boomers are turning 65. we have to have a bigger government

i am doug elmendorf the director of the office.is morning cbo released its update to the economic outlook. i would like to briefly summarize the report and then my colleagues and i will be happy to answer your questions. we estimate that the federal government budget deficit this year will be $1.1 trillion which equals 7.3% of the country's economic output or gdp. down from about 10% in 2009. this is the fourth year in a row in which the deficit exceeded a trillion dollars. federal debt held by the public will reach 73% of gdp by the end of this fiscal year. the highest level since 1950, and about twice that a measure that the end of 2007 before the financial crisis and recession. as always, we have prepared baseline projections to reflect the assumptions the current law generally remains unchanged. they distributed benchmark for lawmakers to use and consider changes in the law. however, substantial changes to tax and spending policies are scheduled to take effect at the end of this year under the current law and whether the lawmak

november elections, what some are calling "taxmageddon", elmendorf says the nation will be thrown into another recession. jon? jon: sobering numbers there. doug, thank you. arthel: we have a fox news weather alert. the national weather service issued a new alert on tropical storm isaac which is gaining strength in the caribbean right now. a hurricane warning is in effect for parts. dominican republic and haiti. of course all eyes are on tampa which is preparing for 50,000 people to arrive for the republican convention there. now for the possibility of isaac hitting the city at hurricane strength. steve triggs the is communications manager for orange county and joins me live on the phone. steve, first of all even if it doesn't hit hurricane strength we're still talking about a tropical storm which will produce high winds and flooding. what are you doing in preparation? folks in florida what to do. but you have 50,000 out of towners. what do you do in a few days? >> that is a quite a challenge. they would have to come up the i-4 corridor into the orlando area. the good news we have 140,000 hotel rooms here, although many are filled at the momen