the people at cbo are fantastic. the economic knowledge, institutional knowledge is incredible, and the issues are endlessly interesting. didn'ted me before, i answer this directly but i meant to, members of congress can disagree with us. sometimes the challenge and my responsibility is to explain it. if a member says this is wrong or a staffer says this is wrong, can you explain it? i have to be able to explain it in a way that is sensible. if i can't explain it i'm not doing my job. >> how many opinions have you changed? phillip: it is not that i am trying to change opinions. i'm trying to explain, here is how we -- >> say, oh i understand why you say it that way now. phillip: it happens. i will not name members, but -- >> you are welcome to. phillip: there are some answers, not that it is complex but thinking through all of the ways the economy interacts with the budget. we do a lot of work on health help -- health care for example. there are provisions that would affect drug prices. that has a budgetary impact. t

we are doing the things you would expect cbo to do, how does climate fit into the baseline. militaryd insurance a installation and things like that, it is discretionary spending, annual appropriations. bigger dollars are probably the overwhelming of -- effect on the economy. andare looking at research how that feeds through to the budget. , the steps are climate, gdp, spending, and revenue and so on. >> emmy -- any economic up-and-down from climate change reduce back a baseline adjustment to do it -- it is implicit and we are working to make it explicit. >> could that lead to a position where hypothetical the cbo could bill to reduce carbon emissions as being pro-economic growth because it would theoretically reduce the effect of climate change? >> it is a good question. under my predecessor, two directors ago, he did a lot of work on cap and trade legislation. the apparatus is there and we're working to simply up the it. to update the analytic tools to develop the policies. >> you can see the entire at 10:00 this sunday a.m. and at 4:30 p.m. on c-span. you can also hear it

interest rates have remained lower over the past several -- then thee cbo cbo had previously projected and we have taken that on board. i started out -- as director at the beginning of june and since of june., -- beginning that is about one point $8 trillion over the 10-year outlook. those two reductions since i've been director. there has been some additional spending and lower revenues in various places. the fiscal situation is still daunting. the low interest rates have mattered. you can see in the chart that we expect interest rates to rise and you can see that over the next several years with both long-term and short-term rates rising. lower than what cbo previously -- and it makes a big difference. this is something we are looking carefully at as you would expect. what are the many reasons for low long-term interest rates? what are the portents? why might those interest rates go lower or higher and if they go higher, what would that mean? abouts a good way to talk the budget deficit. --re is a sense in which there is a sense in which it is hard to know what words to use. we are n

this isn't just cbo's analysis. a few short months ago in this room federal reserve chairman jay powell testified before this committee and said our debt is drawing faster than our economy by a margin. by definition that is unsustainable. there's no way around it. either congress will put the federal budget on a sustainable course or a financial crisis will result. according to cbo the current debt path increases the risk of a fiscal crisis, that is, a situation in which the interest rate on federal debt rises abruptly because investors have lost confidence in our u.s. government's fiscal position. we've heard about the reality of our fiscal trajectory time and time again, and yet it still seems as though my colleagues on the other side of the aisle are not taking the warnings seriously. policies promoted by congressional democrats would increase mandatory spending by tens of trillions of dollars, thus drastically adding to the national debt. the most notable proposals that come to mind are medicare for all and the

so that's cbo but the numbers are clear. they're out there. prior to the tax reforms, cbo says the economy would create an average of 107,000 jobs per month in 2018, we actually got an amp of 193,000 jobs. they also said that in 2019, it would be 27,000 jobs per month, and so far, we are six times ahead of that average at 175,000 jobs. so that's great. the thing that i like best is the wage growth. we've now seen for 18 straight months, wage growth of over 3%. and as we know from the bureau of labor statistics information, this is primarily helping folks who are nonsupervisory, which means blue collar workers, mid income, low income workers, and that's just also news. it is the longest we've been able to see that kind of wage growth since before the great recession, so it's working. one thing that you will talk about a lot, i know today is the international side, i've already heard you talk about some, people are bringing money home. the old system encouraged those companies as you know to leave their income overseas and not to bring it back a

so, that's cbo, but the numbers are clear through out there, prior to tax reform, cbo said the economy would create an average of 107,000 jobs per month in 2018. we actually got an average of 193,000 jobs. they also said the 2019 it would be 27,000 jobs per month. so far, we are six times ahead of that average at 175,000 jobs so, you know, that's great. the thing that i like beth it is the wage growth. we have now seen for 18 straight months wage growth of over 3% , and as we know from the bureau of labor statistics information, this is primarily helping folks who are non supervisors, meaning, blue-collar workers, mid-income, low-income workers, and that's just awesome news, and we have not been able to see that kind of way towards his before the great recession so it's working. one thing that you will talk about a lot is the international side, we've already heard you talk about some, people are bringing money home, they encourage companies, as you know, to leave their income overseas, not to pay back in taxes and international provisions were designed and that, lockout that's exactly

if it does not happen at the school site, we connect them outsourced cbos. often times it's the language barrier because maybe the social worker does not speak spanish so we need to find a translator on campus. initially, it's first getting over the fear, the barrier. once they realize that, they get going. >> i'm happy. you sound confident about it. that's a good thing. >> i also work -- i'm the part-time, but i work full-time at general hospital. so i connect my families to the services at general. and i make sure they're being served. >> thank you, i appreciate that. then my last follow-up. can we talk about -- it's like we're trying to get a m.f.t. on board? >> right. >> is that an m.f.t. contracted? internal? can you talk about what that position is going to do? >> we're excited about this because we had a former liaison who worked for us and she got her events degree and became an m.f.t. and now she has a private practice. before she was like brenda and grew up and became an m.f.t. we're excited to contract with her, because she knows the families and

i have independent cbo, n non-partisan cbo. what is the bases for that? >> sure. it is a post policy budget and post policy economic assumptions. forecasters take the world as it exists. our budget is the fiscal plan for the next 10 or 15 years. it assumes things that will occur in our budget such as extending the tax cuts or ongoing regulatory initiatives or assumes better infrastructure bill or better trade deals. canada and mexico does not sit in congress for a year waiting to be passed. these are all things lead us to be able to aspire and believe that we can get to 3% growth. >> last year, you projected the economy would grow at 3.2% instead of 2.3% which is quite a bit of a fall off. i don't know if the testimony you had from other people if the tax was not built nearly enough the growth. what would happen, what would the deficits grew? >> we would have a hard time to meet our target balance because it is an important part of our assumption. the last four years of the obama administration, increased taxes by 650. >> i didn't ask you about that. >> $3 trillio

the cbo revised estimates of the 2017 tax law's cost. have you factored those increased costs into the deficit impact or is this administration still insisting the tax cuts pay for themselves? dir. vought: we continue to insist that the economic agenda of this president, the tax cuts, deregulatory initiatives within fact pay for the cost of both the original score and the extension of the tax cuts. >> thank you. unfortunately, i am on the ways and means committee as well, and we had a pretty good hearing yesterday about corporate tax revenues or the lack thereof, i should say, and share of gdp. considering they are at historically low rates, lower than almost every other advanced economy. does the administration still believe that taxes should be reformed in any way on corporations? dir. vought: we are looking forward to a tax 2.0 conversation with regard to reform and there's a lot of things that will be part of that conversation. we are mainly proposing to extend the tax cuts, but the administration will continue to work on other tax r

at the point at which cbo ad made that conclusion, it was looking at comparisons between the holings process and budget enforcement act. the budget control act is another example of where the budget process did not actually force anybody to reach agreements. the budget enforcement act was successful because there was first an agreement on the path to be taken and enforcement procedures put in place in order to enforce that agreement. that doesn't mean there aren't budget reforms that can work besides enforcing agreements, i think those have enhanced transparency and the trade-offs that they were talking about between different things in the budget. those that affect the trade-offs of activities in the reform act or does it affect the quality of information which is really the main positive effect from having cbo. all of those can have very positive effects. with that recent reform efforts we know about the choice comedian budget reform and they have a lot of good ideas. there are some ideas that were not so good. but in the end, they were not able to agree on much and that was partly

cbo expense? service from another agency, et cetera, et cetera? so the first of these slides is the sources slide. and as you can see, we divide money up into several different colors. so importantly we have federal revenue that supports a number of programs within d.a.s., certainly the ihss program, the medicaid program is heavily federally supported, the aps program has federal money in it, the public conservator program has federal money in it. the state also contributes money to the ihss program as its largest share. and then we have two small buckets which are really state money, too. those are things that we've labelled as 1991 realignment and 2011 realignment. you can see 1991 is considerably bigger. in both of those years, what the state did was it passed laws that shifted financial responsibility for a number of social services programs to count these. and in 1991, the biggest d.a.s. -- the biggest program in general that was part of that shift, but certainly the d.a.s. program that was part of that shift is ihss. and in 2011, the a.p.s.

cbo expense? service from another agency, et cetera, et cetera?t of these slides is the sources slide. and as you can see, we divide money up into several different colors. so importantly we have federal revenue that supports a number of programs within d.a.s., certainly the ihss program, the medicaid program is heavily federally supported, the aps program has federal money in it, the public conservator program has federal money in it. the state also contributes money to the ihss program as its largest share. and then we have two small buckets which are really state money, too. those are things that we've labelled as 1991 realignment and 2011 realignment. you can see 1991 is considerably bigger. in both of those years, what the state did was it passed laws that shifted financial responsibility for a number of social services programs to count these. and in 1991, the biggest d.a.s. -- the biggest program in general that was part of that shift, but certainly the d.a.s. program that was part of that shift is ihss. and in 2011, the a.p.s. program had

cbo projects by 2049 the federal "deadpool" equal to $48,000 per american. that's almost a million dollars for a family of four. from there it only grows more. interest payments on the debt will increasingly crowd out other federal spending is directed towards programs that americans rely on. cbo projects interest payments on the debt will amount to three and $82 billion in fiscal 20. that's 11% of tax revenue. we cannot continue on this path. we have to lead by example that we have to make the tough choices necessary to reverse course and here we are the greatest nation in the history of the world and we can't even manage to come up with something as simple as a dog on budget. the president is doing his duty and is put forward a budget that take steps in the right direction and i recognize there will be others that will be pushed back on his plan but at least we have a plan to look at. the budget does not achieve balance within 10 years preview overall 10 year project reports the budget on the path to balance by 2035. the president's budget reduces budgets

cbo said in 2018 this would balloon the deficit almost $22 trilli -- $2 trillion over ten years.orse than you expected. is that right? >> well, that's a little bit incorrect. what you did is you said the corporate taxes are coming in way lower than expected. the corporate taxes are losing revenue with the rate, but gaining revenue with all the international tax rules and the stuff that can't pay for itself is like the joint tax cord, $700 billion over ten for an expanded child credit. a lot of democrats support that, a lot of republicans supported that. child credits don't pay for themselves. they wanted to find something that gets stimulated if you cut the rate and totherwise, that $700 billion will not pay for itself. looking at the fullness of time, if we get growth, there will be enough revenue to cover a couple trillion of tax cuts. if that happens over -- >> that's and if. i would say a cbo report recently showed the tax collections are weaker than they would have been without the 2017 tax reform, especially on the corporate side. to coronavirus for our remaining time. you'

we'll hear from cbo director philip sweigel in a news-making interview as the second hour of "squawkight now. >>> good morning welcome back to "squawk box" here on cnbc i'm andrew ross sorkin i'm here with becky quick and joe kernen we're here the day after the debates. red arrows across the screen, the dow would open off 62 points and the s&p 500 off about 6 points and the nasdaq off about 17 points. >>> here's what's making headlines at this hour elle brands is near a deal to sell victoria secret to sycamore partners sycamore would buy up 55% stake with elle brands keeping the remainder. les wexer in would step down as ceo as part of the deal. the stock down now 13% >>> warnings of the economic impact of the coronavirus are increasing goldman sachs told clients the effect of the virus on corporate earnings is likely underestimated in current stock prices steven roche told cnbc the virus may weaken a global economy already in a precarious position >>> mgm resorts has hit by a data breach last year. it discovered unauthorized access to guest data, although it adds no financial or pas

. >> that's the conventional view, feds, cbo, lots of other models that don't understand supply side,pply-side incentives. here's a thought and will leave it here because were not to settle it today. the last four quarters, productivity, at output. hour is up 8.% and that's a pretty good number but from zero couple years ago. and that is because i think of our business tax-cut incentives and regulatory reforms part 1.8% productivity, the labor force is growing about 1.3 or 1.4% when you add those two things together you get close to 3% potential gdp. i think, a lot of these economic models and the government in washington and the private sector on wall street underestimate america's potential to grow. and i think the blue-collar boom, and the women's boom, and the great low unemployment without inflation is telling them they are wrong. so i remain my usual optimistic self, the president is an optimist. that was what is stated the union speech was all about. that's what is dabo's speech was all about. optimism and the leadership, and america doesn't have to be second best. maria: more

a challenge has been that cbo is skeptical of the cost savings. can you talk about that for a second and also commit to working with cbo to come up with a more realistic cost based on the data you have given us. >> yes. i struggle with acchairries and how they do their calculations in terms of savings because we have seen the program, it's popular, the results of the demonstration have been positive. thank you for your leadership on that. it's time to convert this from a grant program with the lack of predictability that comes with a grant program to a state option they can build into their program. happy to keep working with you on that. >> hospice, i'm a big supporter, we were one of the states that pushed hard for medicare coverage for hospice back in the day. i'm told based on a study, 2017 marked the first time ever that a majority of medicare beneficiaries selected hospice for their end of life services. i think that's a good thing. within my own family we've chosen osmi chosen hospice. it's important for people to have the end of life digni

according to the cbo your proposed cuts would cause states to start the process ending the program thatould put 17 million americans at risk of losing coverage including 57000 people in new hampshire it doesn't slow the medicaid growth rate from healthcare but by eliminating access to coverage. >> i may be incorrect but the cbo analysis to previous budget proposals opposed to this one which is a broader allowance to work with congress how we can fix those perverse incentives for instance have the able-bodied adults pregnant women and children. >> let me say this i will follow up with you with those proposals essentially are cutting eligibility and keeping people away from healthcare as opposed to looking at the rate of growth in healthcare costs. let's move on to a second question. as others have mentioned you support to repeal the affordable care act including the lawsuit to strike down the law in its entirety. the present claims he wants to protect patients with pre-existing conditions but if repealed health plans will once again be able to deny coverage to individuals struggling with

host: we will show you in the audience with the cbo director said last week talking about the level of debt and what was sustainable and when the u.s. would reach a tipping point. >> i told you the fiscal situation is unsustainable but interest rates remain low in the united states. united states has the ability to undertake this policy today. for whatever purpose. stimulus, for infrastructure, whatever the congress decides to do. difficulty is the challenges not immediate, but as you said we know it's rising and the challenges knowing what's the endpoint. at what point is the debt level on the tipping point of not being sustainable, there is not an answer in the economic literature and people said maybe at 70% jet -- debt to gdp and we see that. withoutoing above that a problem. and so i don't know. that's a challenge. the worry i have is when we get there, only reach the space as you put it, it will happen quickly in the market will lose their confidence in the u.s. quickly and it will be too late to address it without difficult changes. host:quickly in the what is youy from that? gu

and that's the fully loaded cost of both the original score from cbo. that's the cost of the extension, and that's the debt service cost. >> are you familiar with the economist, mark zandi? >> i am. >> would you characterize him as a conservative economist? >> not really. >> did he advise democrats or republicans? john mccain, generally viewed as a credible conservative economist. he had said that the tax cuts of 2017 for every dollar you give away, you can hope to reclaim $0.32. that's a 68% loss on investment. so tax cuts don't pay for themselves. and because tax cuts don't pay for themselves, we went from an annual budget deficit of $600 billion to more than a trillion dollars. and it's projected that we will take in $1 trillion less than we spend for this year and the outyears moving forward. under -- because tax cuts don't pay for themselves, in the 36 months of this presidency, there's an increase in $3 trillion to the national debt. that's because tax cuts don't pay for themselves. because tax cuts don't pay for themselves, you have a medicare cu

. >> reporter: larry mentioned the cbo estimate there instead the cbo has the deficit forecast to be year, again at 4.6% of gdp, and then debt get to -- so the pace increase, the deficit therefore shrinking a bit. a lot will rest on the growth rate and the relationship with china. one other big takeaway, it was a more constructive tone coming from a member of the administration who used the phrase "new cold war" talking about china and his 4ud son institute speech today the tone was more constructive he said the announcement of $75 billion in tariff relief wasn't even part of the face one trade deal we think it gives evidence that china is beginning to step forward and take the necessary action clearly face two is 23409 very close, but if that does come closer after an election, then the prospect is certainly that guys >> i just don't understand their whole assertion that growth is going to help pay for these deficits we had a trillion dollar definite now, a little under 600 billion when obama left office as a result, we did get a supercharged growth late in the cycle, but not enough

if it does not happen at the school site, we connect them outsourced cbos.language barrier because maybe the social worker does not speak spanish so we need to find a translator on campus. initially, it's first getting over the fear, the barrier. once they realize that, they get going. >> i'm happy. you sound confident about it. that's a good thing. >> i also work -- i'm the part-time, but i work full-time at general hospital. so i connect my families to the services at general. and i make sure they're being served. >> thank you, i appreciate that. then my last follow-up. can we talk about -- it's like we're trying to get a m.f.t. on board? >> right. >> is that an m.f.t. contracted? internal? can you talk about what that position is going to do? >> we're excited about this because we had a former liaison who worked for us and she got her events degree and became an m.f.t. and now she has a private practice. before she was like brenda and grew up and became an m.f.t. we're excited to contract with her, because she knows the families and it's her specialty to

. >> you mentioned hr three with an alternative for hr 19 the cbo scored hr three with the price controls it was estimated for those that were out on the market but those were not if we put those price controls into effect is that they cure for alzheimer's? diabetes? even one is one too many. >> exactly. so many people with diseases are just waiting and holding on they could survive when the next drug comes out for those who have survived. >> so one last thing you mentioned that not all the drugs available here in america are available in canada or the united kingdom. >> exactly. people in canada you have to pay for your drugs there at the very low end of the income ladder but most pay at the pharmacy that in many cases they are not on the formulary but a new word drug could cure their leukemia my uncle passed away from non-hodgkin's lymphoma in 2003 now here in america approved by the fda in 1997. when i talked to my cousin i said you should look and see about getting it for your dad and he dead - - and he did and had the cancer agency had never heard of it and said that's not available

cbo said after a decade it would increase the level of gdp by 0.5 percentage point. that means on an an eventual basis it would increase the growth rate of gdp by one-half of .1. i did a paper and we found a tiny bit smaller, basically the same ball park. that's not an increase of how much it increases peoples' well being because it's funded from international funding. that went up by .1 after a decade which is to say the growth rate went up by .01 per year of gnp. that is not welfare because that came from people working longer, less leisure, and increased amount of that was depreciation from larger capital stock. when you do the net welfare measure, it was 0 or negative. compare that to the distribution. if one group gets a tax change that is plus or minus 2 percentage points, that is huge. that is way bigger direct effect on their income. their income goes up by 2% or down 2% because of the tax change than anything that happens to their welfare as a result of economic growth. my second example to pick a policy that i like about as much as i like the 2017 tax cut w

tonight, the director of the cbo talks about the budget, debt, and federal spending issues.e communicators. after that, ryan mccarthy delivers talks at the national press club in washington, dc. on newsmakers this week, our guess is director of the congressional budget office phillip swagel. and helping in the studio, richard rubin and jim hanker sulli. before we get to those questions, for those outside of d.c., explain what the congressional budget office is, who you answer to and what viewers should take away from your latest reports? phillip: thank you for having me on the program. [please stand by]

newsmakers is next featuring cbo director phillip swagel.eches from 2020 democratic presidential candidates in the nevada. after that, a look at incidents of white supremacy in the military in the a hearing held by the house armed services subcommittee. >> follow campaign 20 to nevada this weekend. today live at 5:00 p.m. eastern joe biden, p jazz, amy klobuchar, and tom speier -- tom steyer speak. listen on the go on the c-span radio app. >> tonight on q and i, a look at american presidents through the lens of the books they have written. been thatry has often kennedy's father was the one pulling the strings. but that is not true -- jack kennedy one at that pulitzer prize. he told historian i would rather win the pulitzer prize then be president. because he had this desire for literary fame -- even though he did not want to do the literary work -- he got the prize. in the washington dc people had been gossiping, did kennedy really write that book? but then, the pulitzer change the equation. i think it made it a moral question and an ethical

host: you can see the entire interview with the cbo director this sunday at 10:00 a.m. at 4:30 p.m. on c-span. you can also hear it on c-span radio and watch it online at www.c-span.org. pivot to thee will nevada caucus and we want to get your thoughts on what's going on in campaign 2020. we will open up our regular lines for the discussion. the upcoming nevada caucuses call the first in the west and that's next saturday, february 22. we are already hearing a bunch of different stories about what's going on in the nevada caucus and we want to make sure you remember to watch c-span for campaign 2020. we will show you the next few campaigns coming up. the nevada caucus will be february 22 and at staker are 36 delegates. that's followed by the first in the south primary which will be in south carolina saturday, february 29. 54 delegates are up for grabs on saturday, february 29 and then 3.er tuesday on march 1003 hundred 50 seven delegates will be up for grabs. you can watch all of this on and arewww.c-span.org free radio app. we are opening up our phone lines for conversa

i think three years ago, cbo was suggesting only 2 million. s&p up 49%. gdp growth to have%. the numbers are great but i'm wondering what you specifically, drove down the overall numbers. >> a couple of things, first, labor participation rates are up, it's very good on that front. in the last year, three quarters of the jobs were by people not in the labor force at the time. that's a very good sign. it's one thing to have a low 3.6% unemployment number, it's another to be bringing people in off -- >> that's of reversal of what happened during the obama administration. >> that's right. precipitation participation was trending down. the other thing that leaks out is comparing where we are with what was predicted. compare where we are now with the congressional budget office predictions and all august 2016 for they said we'd be up 4.9% unemployment they said from then until now, we've had 1.9 million jobs in we added 2 million just last year. there was a change. also change? a new president, new policies. >> in corporate america, when you have requisitions open for too long, eit