mr. elmendorf, i appreciate cbo's work. i think you do very valuable work. you missed the gdp this year. i think you were at 2.7 predicting it and it came in at 1.7. but mr. zandi at the great moody's was at 4%, and it came in at 1.7. so i give you credit for being that more accurate than some of the other experts. i would just say that all of us need to de that the challenges we face with regard to debt and the unsustainable fiscal course we're on is that debt creates risk throughout the system and puts us in a more dangerous area if some unexpected shock occurs. would you agree with that? >> yes, absolutely, senator. >> things that you can't predict. >> yes. >> you just can't predict them. but periodically, history shows do happen. >> yes. and that's one of the costs of higher debt that we highlighted in our issue brief, as you know, on the risk of a fiscal crisis. >> so i think we need to get that margin down. a larger margin between what the maximum debt this nation can possibly carry and get it well below that so we're in a position to avoid shock. the -

mr. elmendorf basically told us that at the hearing, there's no way to pay for the war. the way cbo scores if you have a million dollars for the war last year, they assume it's going to continue for it ten years. if you reduce that trend, then you've saved money under their scoring. but it's unrealistic in terms of the debt of the united states. there's no money there. no fund of money. it's not paid for. this money you're saying is going to be paid for from the war funding is going to be borrowed. it's money we're no longer borrowing for the war. instead of taking a deep breath and relax because we didn't have to borrow that money, you propose to spend half it on the roads. that's not common sense. it's the reason the country is going brochlt i remember asking m -- going broke. i remember asking mr. elmendorf on the eve of the vote weren't we double counting $500 billion to justify the health care bill and make it look like it's going to make mo f the government instead of cost money for the government. he said, yes, you're double counting. i asked him, would he put it

mr. chairman. and i apologize for having to leave. >> sure. my pleasure. dr. elmendorf, the time is yours. >> thank you mr. chairman, congress machb van hollen and your kind words about cbo. i'm priv lemged to be leading a group of extraordinairely talented and dedicated public servants and we all appreciate it very much what you have shown for our work. we will continue do our very best for this committee and for congress as a whole. i'll be referring as i talk to some charts that i'm told are in your notebooks. it's about a half a dozen slides. they're mostly out of the outlook, but they're collected in this handout to make it easier for you to follow what i say. lenlet me begin by saying the economic projections are considered on current law not because we expect that there will be no changes in law but because this approach provides a benchmark against which potential changes can be measured. what we are presenting is a benchmark, not a forecast. that distinction has a large impact on the budget and economic projections. what is our assessment of the economic outloo

mr. elmendorf, if i'm off, or if you can give an opinion, i appreciate it. the way we calculate it in real over ten years in the defense department under the sequester in nominal dollars would get 2% more money. but in an inflation-adjusted real dollars, it would amount to about a 20% cut. whereas the remaining 5, 6 of the government over that same period of time with inflation-adjusted dollars would achieve a 50% increase. does that sound correct to you? >> i don't know the precise numbers, senator. as you know, the budget control act exempted social security, medicaid from the sequester, some of the programs limited the sequesterer ability for medicare. our estimates are that defense spending would come in about 10 over the decade about 10% -- under the sequester, relative to what would have been our traditional baseline projection of spending growing with inflation, i think the gap between that traditional projection and the effects of the sequester is about 10% in terms of defense spending over the coming decade. >> it's possible we were using the presid

mr. elmendorf's testimony beginning at 10:00 a.m. eastern here on c-span3. >>> this is c-span3 with politics and public affairs programming throughout the week and every weekend, american history tv. 48 hours of people and events, telling the american story. get our schedules and see past programs at our websites. and join in the conversation on these social media sites. >>> the pentagon's number three official gave her last major speech sunday at the reserve officers association symposium in washington, d.c. she'll step down from the post on friday. this is just under an hour. >> welcome back, everyone. we'll continue with our program, continuing with the excitement. today's presentation titled "d.o.d. policy: a look back and a look ahead" will be in just a minute. before we begin the key speech, we would like to present the r.o.a. chaplain, lieutenant father vincent robert capidano, chaplain of the year award. the father was the only chaplain to receive the medal of honor. he was killed in action in vietnam in 1967. and we named th

mr. elmendorf i'm sure pointed out under current law there's going to be a massive fiscal contraction in 2013. without addressing any of the specific policies involved, i think congress should be aware of that, and try to avoid having too big a hit on the recovery in 2013. and then, finally, you know, again, without taking specific policies -- aside specific policy, third point, fiscal policy is not about fiscal spending and taxes. a lot is the quality of the budget. are the things we're spending it on, are they going to help our economy? do they support rnd or workforce skills or other thanks will help the economy grow in the long run? on the tax side do we have -- are we moving towards more efficient, more effective tax codes, simpler, fairer and the like? so i think you want to look at the top lines, total spending and total tax, the deficit, but obviously, and it's easy for me to say, but it make as difference the quality of the program, the way the money is spent, the way the money is collected make as difference in terms of jobs and growth. >> mr. cole? >> thank you very much, mr.

mr. elmendorf knows this. there are a lot of very, very skilled people in this town that know how to read your reports and if taken out of context, or improperly allowed the debate to continue on the floor of the senate and the president to assert that this was a program that was going to make money for the government. that was not accurate. i felt pretty sort -- senator thune led the battle on it to try to point out it was not going to make money for the government, but that that you scored was used to reduce the cost of the president's plan. and that -- in the short run maybe it would have if it had been implemented. in the long run it would have been a cost. we do need to figure out how to use your scores more objectively. thank you. >> we work hard to try to explain ourselves and explain our numbers in a way that makes the most possible people understand them and fewest possible people misuse them. but as you know -- i don't think we always get that language just right. we work very hard at it. we are at l

mr. el elmendorf we thank you and your team for your work. i think what you're saying is we needed the supercommittee to work, we need a long-term plan that both deals with the short term in terms of what is happening with jobs. we know we'll never get out of debt with 13 million people out of work, but we have to focus on the long term. i want to thank you for that. just to reiterate, thank you for your work on the budget control act and in fact it may have been a little different process, but we did pass a budget last year. just for the record and i think there's been a manufactured political issue around whether or not it was done in the normal process or through something called the budget control act, but it certainly was done with budget caps and we can go further this year. but we certainly put in place both a budget framework and appropriations. within that, let me also just say for a moment that we in agriculture did our part and just because we did a lot of hard work together with cbo i want to thank you very much for burning the la

mr. chairman and dr. elmendorf, thank you for your testimony today and what you did in relationship to the so-called supercommittee which turned out not to be so super. we appreciate the work of your team, some of whom who are with you today. we did a lot of good analysis that i think can be helpful going forward. and in answer to the chairman's question and the ranking member's question and the confidence that people are looking for would be helped by having a plan. and part of that plan is what the supercommittee was not able to arrive at, but what we still have to do. the problem doesn't go away and part of that plan includes tax reform, not just tax increases and so in the context of that, let me ask you a couple of questions about the tax side. first, with regard to your report, this week which was very helpful, the alternative base line as you know shows that the tax extension would save jobs. you apparently looking at your testimony referred to that. basically, as i look at it, you're saying that under your

elmendorf, thank you for being here. if i could take a brief moment, mr. chairman, i would like to thank dr. elmendorf and his staff for their terrific cooperation and support during the work of the joint select committee on deficit reduction. that was a difficult ands fr frustrating experience for me, not because of your doing. i want to commend you and your staff for the really professional and prompt and thorough and thoughtful work you provided and response you gave us. >> can i interrupt and ask, did you find that director elmendorf was always in agreement with your assessment on the matters or did you have the experience like mine that i often find he doesn't agree with my position? >> it was my experience that in the most civil and diplomatic way he expressed his disagreement. but i appreciated his candor and help. just a few thoughts, if i could, mr. chairman. first, i would suggest that comments have been an contribute an attributed to you with comments in the committee. i would just want to encourage you as strongly as i possibly can. i think that

mr. elmendorf , will be on capitol hill today testifying before the house budget committee.e will have live coverage of that at 10:00 a.m. eastern time on c-span3. as i told you, the conferees meet again on the payroll tax cuts. that will be both house and senate conferees. go to our website, c-span.org. we will play it live at 10:00 a.m. on our website. that's all the news this morning on the economy coming out of these congressional budget office yesterday. atlanta, georgia. david is a ron paul supporter. we're talking about romney's win in florida and what it means going forward. caller: ron paul is the only candidate up on the stage that has a different position than any of the others, including president obama. he is the only anti-war candidate. he's the only candidate who wants to restore our civil liberties. host: ok. what do you make of his 7% last night in florida? caller: florida is a new winner- take-all state. he did not even with the effort force. i'm not sure he will get the nomination, but i sure will support him all the way. i think he is the only one who has

mr. elmendorf pointed out that under current law there will be massive fiscal contraction in 2013.ithout addressing any specific policies involved, i think congress should be aware of that and try to avoid having too big a hit on the recovery in 2013. finally, again, without taking specific policies, my third point was that fiscal policy is not just about total spending. a lot of it is the quality of the budget. are a lot of the things we are spending on, are they going to help our economy? do they support research and development, work-force skills, or other things will help the economy grow in the long run? on the tax side, we are moving towards more efficient tax cuts. you want to look at the top lines -- total spending a total taxes -- obviously, it makes a difference the quality of the programs, the way the money is spent, the way the money is collected. >> thank you mr. chairman. before i get to my questions, i want to thank you for the role you played during the current situation, which typing was a critical point for the country. i want to thank you for your transparency an

mr. chairman, i apologize for being late. i was at the opening session of the house budget commission with dr. elmendorf, the head of the congressional budget office. i'm pleased there seems to be consensus that we need to move ahead to extend the payroll tax cut for 160 million americans through the end of this year. i think that is a very important step to make sure people have a little bit more money in their pockets so they can go out and purchase more goods and services so small businesses can sell those goods and services and hire more people. i think that makes sense. i do think that as we pursue this conversation, we should look at a different standard set by certain members of congress with respect to what we pay for and don't pay for. because it has been the position of the republicans in congress that we don't pay for tax cuts for folks at the very top. permanent tax cuts. it is curious to apply a standard when we are talking about a ten month tax cut for 160 million people as opposed to a permanent tax cut for the disproportionate benefits for the folks at the top. senator crapo, you were me

elmendorf here. we should ask him that question and keep his feet to the fire as well. so i'll help you do that. but mr. chairman, you've done such a good job since i've been here of providing graphs so, i guess -- imitation is the greatest form of flattery, so i brought a couple graphs here today that i've been showing in wisconsin, to basically describe what i think is the problem facing our nation in terms of economic growth in our deficit and debt situation. certainly as i was reviewing the testimony that will be given just here today, my concern is that we're trying to address a problem of fal and i think we're seeing that in europe, and it just isn't working that way. one of the charts that i showed to groups in wisconsin, i turned smiling face into frowns is i describe the history of our debt. i like using this one because it shows in 1987, our total federal dead was 2.3 trillion. it took us 200 years to accumulate $2.3 trillion worth of debt and we entered an agreement last year to basically give the president the authority to increase the debt ceiling by 2.1 trillion and we'll be over that lim

mr. lipinski on the democratic side. in response to a question i put to him last year, the c.b.o. director douglas elmendorf wrote, and i quote, the secretary of health and human services has concluded the class program can't be operated without mandatory participation so as to ensure its solvency. h.h.s. secretary kathleen sebelius called the program insolvent and the chairman of the senate budget committee called the program, in 2009, a ponzi scheme. in fact he went on to say it woult make bernie madoff proud. in its consideration in 2009, the c.m.s. actuary, richard foster, told the obama administration staff that, and this is his quote, 36 years of actuarial experience lead me to believe that this program would collapse in short order and require significant federal subsidies to continue, end quote. he was ignored. in fact, he was eventually cut out of the email loop so that they didn't want to, the health committee on the senate side and the staff of senator kennedy they didn't want to hear any more from him. subsequently, in december of 2010, the president's fiscal commission recommended that they ref

mr. lipinski on the democratic side. in response to a question i put to him last year, the c.b.o. director douglas elmendorf wrote, and i quote, the secretary of health and human services has concluded the class program can't be operated without mandatory participation so as to ensure its solvency. h.h.s. secretary kathleen sebelius called the program insolvent and the chairman of the senate budget committee called the program, in 2009, a ponzi scheme. in fact he went on to say it woult make bernie madoff proud. in its consideration in 2009, the c.m.s. actuary, richard foster, told the obama administration staff that, and this is his quote, 36 years of actuarial experience lead me to believe that this program would collapse in short order and require significant federal subsidies to continue, end quote. he was ignored. in fact, he was eventually cut out of the email loop so that they didn't want to, the health committee on the senate side and the staff of senator kennedy they didn't want to hear any more from him. subsequently, in december of 2010, the president's fiscal commission recommended that they ref