Passage of Paul Ryan’s Path to Prosperity Budget, in addition to reducing the national debt by $9.9 trillion over the period 2012-2012 compared to the current budgetary path, would have significant positive economic benefits, according to The Heritage Foundation’s Center for Data Analysis. Here’s what happened when CDA applied the macroeconomic models from Global Insight, Inc., to Rep. Ryan’s proposed budget:
Private employment grew by an annual average of 1.6 million jobs above the CBO alternative budget baseline. Total employment grew by an average of 1.3 million jobs, which indicates shrinkage of public-sector employment of 300,000 on average.
… The Gross Domestic Product grew by an average, inflation-adjusted amount of $149.5 billion above baseline over the 10-year period. By 2021, GDP is $401 billion higher than baseline.
… The after-tax, inflation-adjusted disposable income of households by 2021 is $164 billion higher than the baseline. Lower taxes and a friendlier economy led to the formation of an average of 123,000 more households per year.
See “Economic Analysis of the House Budget Resolution,” by William Beach , Karen Campbell, John Ligon and Guinevere Nell,” The Heritage Foundation, April 5, 2011.