Jason Furman, a professor and noted economist at Harvard University, thinks the debt ceiling agreement is significantly better than nothing, but said it was too close for comfort.
The budget debt agreement is enormously better than nothing, and probably about where things would have landed in a regular appropriations debate. I am hoping we are getting close to the end of this process and removing an unnecessary and completely self-imposed risk to the economy, he said.
President Joe Biden on Sunday reached a budget agreement with House Speaker Kevin McCarthy to end the debt ceiling at $31.4 trillion. Biden also said the deal was ready to move to Congress for a vote.
The agreement would suspended the debt limit until Jan. 1, 2025, and limit spending in the 2024 and 2025 budgets, claw back unused COVID funds, speed up the permitting process for some energy projects.
The nation's best interests were in the best interest of Furman, who added that eliminating the debt limit could be in the best interests of the nation. This was much too close for comfort. It is in both sides - and the country's - interest to eliminate the debt limit. Fallback could be an automatic process e.g. the BPC Bipartisan plan. Barring that, the economist said, a much stronger set of norms against brinksmanship and hostage taking.
The professor had earlier expressed optimism about the debt limit being raised but had expressed his doubts about the 14th Amendment and platinum coin solutions if talks were to fail.
Furman said the funding cut by the IRS is particularly galling especially since it will increase the deficit. It should not be repeated ever again, he said in his tweet.
The debt ceiling deal would take away $10 billion in fiscal years 2024 and 2025 in funding from the IRS, Reuters reported. However, the White House believes that the IRS can make payments in the short term because they were funded over a 10-year period.
Fed s Goolsbee believes inflation is still higher than where it needs to be - we are improving Haven t Succeeded.