Jobs/Economy

The Congressional Budget Office expects that, in 2012 under current law, the unemployment rate will remain close to 9 percent, and gross domestic product (GDP) will be about 2 1/2 percent, with the level of GDP remaining well below its potential.  Verify here
Gross Domestic Product (GDP) is the sum of all income earned in the domestic production of goods and services.  In 2011, it totaled $15.0 trillion.  Verify here
The U.S. economy has struggled to recover from the deep recession that, according to the National Bureau of Economic Research, began in December 2007 and ended in June 2009. Although total output started to expand again more than two years ago, the pace of the recovery in output and employment has been quite slow, and the economy remains in a severe slump. Real GDP in the third quarter of 2011 was about 5 percent below CBO’s estimate of its potential.  CBO expects that, under current law, economic growth will continue to be slow and real GDP will stay well below the economy’s potential for several years.  Verify at Page 5
Weakness in the demand for goods and services is the principal restraint on hiring, but structural impediments in the labor market—such as a mismatch between the requirements of existing job openings and the characteristics of job seekers (including their skills and geographic location)—appear to be restraining hiring as well.  Verify at Summary
Under current law, the expiration of tax cuts and constraints imposed by the recently enacted Budget Control Act of 2011 (Public Law 112-25)—along with automatic changes in the budget as the economy grows (namely, higher tax revenues and lower spending for some income support programs)—will cause federal fiscal policy to significantly restrain economic growth in 2012 and 2013.  Verify at Summary
Reductions in taxes and increases in government spending would produce short-term economic benefits—but without offsetting actions to reverse the accumulation of government debt, future output and future incomes would tend to be lower than they otherwise would have been.  Verify here
For contrast – In all, deficits would total $9.5 trillion between 2012 and 2021 under the President’s budget (or 4.8 percent of total GDP projected for that period)—$2.7 trillion more than the cumulative deficit in CBO’s baseline. Verify here
The decline in the labor force is partly owing to a marked rise in the number of unemployed workers who report dropping out of the labor force because they were discouraged about their job prospects. If those discouraged workers were counted as being in the labor force and unemployed, the unemployment rate in October would have been 9.6 percent rather than the actual 9.0 percent.  Verify at Page 8
Despite the near-term economic benefits that would arise from reductions in taxes and increases in government spending, such actions would add to the already large projected budget deficits, either immediately or over time.  Verify at Page 4
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