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Spending Effects of the Fiscal Cliff Deal

Created on January 10, 2013

Spending Effects of the Fiscal Cliff Deal

Extending unemployment benefits

"Doc fix"

Delaying sequestration by two months

Farm bill extension

Reducing BCA caps on spending, FY 2013–2014

Medicare spending offsets

Net change

IB 3822

heritage.org

Notes:

a The Congressional Budget Office (CBO) shows the farm bill extension as having no cost because the CBO baseline assumes the extension even though the authorization has expired.

b The legislation offsets another $12 billion through a revenue timing shift from traditional tax-deferred retirement plans to Roth accounts.

c The CBO analysis also shows $276.5 billion in higher spending that merely results from refundable tax credits included in the extension of current tax policies in the fiscal cliff agreement.

 

Source: Heritage Foundation calculations based on Congressional Budget Office, “Estimate of the Budgetary Effects of H.R. 8, the American Taxpayers Relief Act of 2012, As Passed By The Senate on January 1, 2013,” January 1, 2013, http://www.cbo.gov/sites/default/files/cbofiles/attachments/ American%20Taxpayer%20Relief%20Act.pdf (accessed January 9, 2013).

Chart 1

INCREASES

DECREASES

Billions of dollars