so did cbo make any assumptions regarding on how states would make those decisions? >> i believe cbo made a technical judgment that based on past experience it takes states approximately two months to implement the change in policy. >> with respect to the funds that are eliminated for the health insurance exchanges, i assume those would also be cut off beginning july 1st, is that right? >> yes. legislation is effective july 1st, but cbo in their estimate specified that they expected there to be some spending between now and then for commitments already made by the federal government. so the legislation does not require the federal government to break commitments it made to states. >> well, i mean, the federal government made a commitment in the affordable care act it would help support and provide funding for the creation of these exchanges. we are breaking that commitment through this legislation, are we not? >> by commitments i was referring to the specific commitments that between the state specific agreement to provide funding for a specific purpose, not a genera

the cbo itself, these are all cbo scenarios. it's not an s&p scenario. the question was which of the various scenarios should be underlying the rating and assessment? we did agree with the treasury that it should be the baseline scenario which would lead to $20 billion rather than $22 billion. there was no mistake on their side and no mistake on our side. >> you just made a mistake writing an article mistake. what he says, and i'll read what you he says. he says, standard & poor's presented a judgment about the credit rating of the u.s. based on a $2 trillion mistake. after treasury pointed out this error, a basic math error of significant consequence, s&p still chose to proceed with their flawed judgment. he thinks you made a mistake. >> well, i just represented to you. >> no mistake on either side? you must have made a mistake in thinking you made a mistake? >> well i can only describe to you the turn of events from the time back then and the turn of events as i described. this is a normal discussion that you have with governments when you meet the gov

i understand one half of the cbo argument. the taxmageddon as it is now referred to would result in a $3,800 increase for every taxpayer in the u.s. would be horrific. what i don't understand and jonas alluded to is a decrease in the spending of $100 billion. spread out over a number of years. the cbo thing will have a dramatic effect on theky economy. we just spent seven times that with the stimulus and it didn't budge the needle in a positive direction. i would like to see the tax cuts stay and the spending go away. that would be great. then we would have smaller government. why should the government be spending the $100 billion when we could keep it in our own pockets? that would be a win-win. >> we have kicked the can down 8 miles down a 2-mile road. now, you are to the point it going to go down to the choir and be the same b.s. we have seen every time. and then tell you what, let's just defer it for another two years. what does that tell you about it? >> i don't think they will cut another deal. i don't think another deal

senator reid issued a statement about the cbo report saying this.want to walk away from the bipartisan spenning cuts agreed to last august, they will have to work with democrats to replace them with a balanced deficit reduction package that asks millionaires, to pay their fair share." congresswoman pelosi, minority leader said the same thing today. >> she also wrote a letter asking republicans to hold a vote next week on extending all of the bush tax cuts, except for the ones for the top earners. they are not going to hold that vote. republicans are trying to push this off to later on in the summer. they say it will want to raise taxes for just one group of americans. the interesting thing about this is the timing. because while house speaker john boehner as you all know came out a week ago and said the time is now, we can't wait for a lame duck, in the few weeks between an election and the end of the year and holidays, the economy is on the brink. this is a huge blow to the economy. we have to act now and started on the difficult work. both parties

and as i remember cbo gave us a number that we all thought was too low. we went ahead and passed the bill in a bipartisan way. and if i'm not mistaken the outcome was more like what we thought it was going to be than what the congressional budget office thought it was going to be. and you know, at some point, i know it's hard to analyze it, i think congress has got to start looking back on some of the estimates that come from these bodies and you know, use their judgment a little bit to try to make some of these very tough changes. >> how do you do it without that independe independent ar bitter? >> to the point congressman gephardt was making, right now joint tax and cbo do their projections in a black box. and you say well what about this and they come back and give you a number. they say how did you get the number? secret. won't tell you. some people argue you should have a dynamic model. you can corrupt a dynamic model just as you can corrupt a static model. i'm a little bit weary of saying do dynamic instead of static. one suggestion congressman john

the cbo budget -- the cbo has it right. the democrats have it wrong.ut this guy back in the white house for another four years and we have to be crazy. thank you, c-span. host: head of the secret service shows up before congress today at 10:30 a.m. this will be a hearing on the misconduct you have heard about in the papers by secret service agents and whether the warning signals existed before hand. he has been called to provide details in the scandal. that resulted in the this of -- dismissal of nine employees. four of them are looking to get their jobs back. the director has never spoken publicly since it took place last month. he will appear lives before the senate today. you can watch said on c-span starting at 10:30 a.m. listen to it on c-span radio, as well. or again. good morning. ted, democrats' line. caller: it is kind of a shock to wake up and see the congressional budget office saying that we are of the cliff again. i am just wondering, forget about dodd-frank and the volcker rule. let us go back to the trigger that started this -- the repea

for the cbo community, we all feel the same about children as the district does. any possibility of further collaboration or continuing this is very well done in the cbo community and we were excited to join with the district. for the parent involvement for the summit, we had coleman advocates and they do a number of focus groups of parents. unsurprisingly, parents were excited to further the bridge between community-based programs and the school district. i think all lot of their interests are the same period -- a lot of their interests are the same. they want their children to succeed and better communication. the better off the children. that was the overarching lesson from the parent involvement peace. -- piece. for the input section in particular, do you want more information about what they can do to support their children's learning and more access to teachers and they would like more support navigating all the assignment system. they communication peace -- piece emerged as an interesting and exciting need. the third component of this project was the summit

-- handing them off to a grant-funded cbo for the rest of their day. students experience it seamlessly. they know they are there for a 6 hour camp. part of it is learning. but what they are organizing in sig is a combination of certificates staff and cbo staff. the appointing a way at how this might be done. -- they are pointing a way at how this might be done. this could increase at the back order and provide that enrichment. -- this could increase the academic side and provide that enrichment. i will return to the slide. this is a relatively small program that serves approximately 130 youth, located in four classrooms at chavez elementary, another at everett, and another admission. the aim is to serve students who qualify for services under migrant ed. this is led up by helen inside the district. relatively small, but still important in the portfolio of services. supervisor campos: what is the definition of migrant? >> i will have to rely on my slides. this is not in my bailiwick. this is meant to support students who are not permanent residence here

in terms of attempts to be more responsive to the needs of cbo community, the recommendation you see before you will be the template for a three-year grand period for the mayor's office of housing, service dollars, and for the economic development of dollars. the office of the workforce development, workforce grants, 12-13 is the second year of a two-year cycle. they 1 then do a subsequent two- year cycle. we're trying to match our funding for most of your cycles within our five-year consolidation plan, in an attempt to allow the cbo to better plan for their long-term financial sustainability. we will still be getting it to 1-year grants with them, so you will still see me next year because, as you know, the actual amount will vary from year to year. if we get an increase or decrease, we will have to make those adjustments. for your information, in terms of a formal allocation to the city of san francisco, we received approximately a 12% to 13% cut on the cd besides. over two years, a 27% decrease. on the home side, we received a significant cut. it is a 40% cut for next year, meanin

cbo said the same thing. it would be devastating. so it's a combination of the huge tax increases and a combination of sequestering and how it would work. this is across the board cuts. we also have a debt limit coming up which for many of us in the republican side will require some more focus on the spending as many of us who voted for the spending restraint. so it's a time when we do have an opportunity as a country to make some of these tough decisions. i would say, though, we have no choice but to do it. and i hope that patricia is right, that both parties see it in hair interests to move forward. we simply have to. javier talked about some of the differences. i would disagree with some of his analysis. certainly the impact of the analysis. but, look, we can have those debates, we need to stick to the facts. i think the fact is 24% gdp in spending is historically high. we're headed to 30% by 2030. this is unsustainable. we have to deal with the spending side. that is a fact. on the revenue side, it's relatively low. cbo also says

they are looking at only what cbo can lo

is what only cbo can do. this is not 300,000 people are thrown in the streets. they are saying if this was done with current law, this would happen then. it would make that that sift so i understand it sounds good to give the illusion that 300,000 people are thrown on the streets. cbo reporting does not line up that w that, and so while i understand the dynamics of this of trying to give flexibility back to the states and to be able to allow the states to be able to make some decisions on this and to take us back to where we were just three years ago on how he handled medicaid, i do not see a draconian cut on it and throwing people into the streets with that. with that i yield back. >> thank you. i'd like to yield five minutes to mr. hillscamp. >> thank you, i appreciate the time and the comments and my colleagues. i'm from a place that many of us on this committee have and that's working on our state legislatures before we arrived here, and i must note my constituents do ask do you drink different water in w

host: what does the cbo speculate as far as the severity of the downturn? guest: what made big news is that in the past, the cbo said that economic growth would be slowed, 1.1% gdp growth over 2013, if this is " cliff -- this fiscal cliff remain in place but much smaller growth overall. in the first part of 2013, it would be contraction. the definition of recession is 2/4 of negative economic growth. we would see that important psychological barrier cross into recession in 2013. once that happens, it is for various reasons even more problematic for the economy. host: what does information from the report made for those on the hill debating about spending cuts and tax hikes? guest: hmm, well, we saw a flurry of reactions and statements about the report, and again, they show no signs of either side budging. it is important to remember that people don't strike deals until they really have to. until then, they can jockey for position advantage and will not strike a deal. that is what people said nothing is quite happen until the election, because people don't k

but the consensus from cbo and every economic forecaster is that it helped. it probably wasn't enough. but compared to europe, our growth rate looks pretty good. >> that cbo right now saying if we let tax cuts expire and spending cuts happen we have a potential recession in 2013. so the nature of ideas as far as spending and taxing, those haven't stayed the same. now we see potential results and that's why republicans are reacting. >> it's another part of what alarms us, though. we not only have big problems in the short and long-term that can't be resolved with the political system operating the way this one is, but if you think about that moment in december, at the end of december, all the bush tax cuts expire. the deal we had with the payroll tax cut, fix in doc pay for medicare, unemployment benefits expires, we'll probably have a potential government shutdown because we're not going to resolve appropriations for the year that begins october 1 at this point because house republicans decided to throw out the very delicate deal in law, not just a budget res

current projections from the cbo say the u.s. will spend, prepare yourself for this one, $624 billion in interest in ten years. we will spend more on interest than on medicaid in six. this is absolutely not okay. i interviewed speaker boehner and asked him whether armageddon is avoidable. >> we all know social security, medicare, medicaid, they're all bankrupt. it's not like there's money in the social security trust fund or the medicare trust fund. it's all been spent. >> still, the speaker told me that to approve the debt ceiling increase this year, he's going to demand spending cuts and reforms dollar for dollar. >> debt ceiling going to go up? >> i think i've made it pretty clear right here. allowing the debt ceiling to go up without addressing our fiscal challenge would be the most irresponsible thing that i could do. >> okay. the reality is it this. the debt ceiling must and it will go up, but is there a solution that isn't just talking politics and pot getting anything done. yes. >> ich read every word of the simpson-bowle

so a washington heed the warning now that the cbo has finally stated the obvious?majority leader harry reid responded to it immediately saying we could avoid the so-called fiscal cliff tomorrow if republicans would agree to extend the middle class tax cuts. okay. what we need from our leaders is leadership. that statement tells me we're going to be seeing more gridlock ahead. doug holt seeken, robert reich, author of the new e book beyond outrage. that's how i feel when we start talking about congress and how it deals with some of our problems these days. okay. so is congress finally going to wake up because of this, bob? everybody has been saying it for months, years. is this going to do it for congress? >> hi, erin. officially, i don't think there's going to be any wake-up. i think one has to be beyond optimistic to think in an election year congress is going to actually compromise on anything. now, the hope is that with this warning shot by the cbo, at least behind the scenes staffers and maybe some moderate republicans to the extent there are any left and maybe

so the the quick thing on the cbo report. they used 9 r word which is very, very scary, recession of if all of these things come to pass, they said, the economy woulbe in recession in the beginning of 2013. >> which got everybody's attention. >> which got everybody's attention. but in some ways that wasn't really the message, that the cbo wanted it to send. because yes, that would be a very bad outcome. but the second thing they said was that the alternative if you feel a bet figures-- and just dug the debt deeper, the debt hole that much deeper, that would also be a terrible outcome later. so they have been begging in their very quiet sounding cbo language, please members of congress, you need to both avert the fiscal cliff now and come up with a plan that markets can understand, that you really have to fill the debt hole later on. whether congress can manage that,-- . >> woodruff: so david, congress this year is watching the election. not a lot is going on over the summer. so does something like this that said in the late s

it must be true. >> it's what rush said. >> the cbo only counts jobs inside each plant. that have been saved -- even diners near the production plants were saved because -- >> uh-huh. >> yeah i don't -- stuff like that -- >> you know what i'll research the number -- that most experts went with that were either saved or created from rescuing the auto industry. that is so counter intuitive to go he lost jobs by saving -- huh? >> let's go to courtel from kentucky. >> i'm the official gay black of the "stephanie miller show." [ bell chimes ] >> i'm getting so sick of these right-wing evangelical preachers who are out constantly making sermons saying people like you and me need to put to gaffe. excuse me. but -- god said he didn't want us -- i happen to know for a fact -- >> well, you know, i was just going to say, by the way. i think these people are em-boldened by this vote in in -- north carolina. but do you know how low the turn out was? but these guys feelen boldened. take your organ out, please. [ organ music ] >> we have this coming up in right-wing world but we can pl

gridlock is not going to fix. >> i defer to margaret. >> cbo is nonpartisan budget.ence in d.c. last week. what will it take for members of congress to get into their heads that fixing the debt and fixing the deficit is something that not just americans care about. we know we'll pay for it. >> inaction actually advances what you just put forward. debt and deficit. what worries people is economic growth. you can't put in big tax increases and big spending cuts. that hurts economic growth. >> they are having a fight in europe and here too. we need growth in the near term but austerity in the long-term. how are we going to telegraph that. >> sometimes those things collide and it's up to congress to figure out how to navigate that. >> you look at the bush tax cuts and whether people like it or not, they have contributed to the deficit and it's going to be a problem when you have this conversation because gop says don't keep them in but also causes deficit to increase. democrats don't want cuts. that impacts the deficit. both have to give up something. >> what do you thin