CBO Testimony: Statement of Robert Dennis, Assistant Director Macroeconomic Analysis Division, Issues Affecting the Bureau of Economic Analysis Before the Subcommittee on the Census, Committee on Government Reform, US House of Representatives
CONGRESSIONAL BUDGET OFFICE (U S CONGRESS) WASHINGTON DC
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This report discusses some of the major issues affecting the Bureau of Economic Analysis BEA, the enormously respected keeper of the national income and product accounts NIPAs. This report also discusses the crucial role those accounts play in shaping public understanding of the U.S. economy and in helping the Congressional Budget Office CBO construct its baseline budget projections. Several ways in which BEAs data might be improved are by extending its innovative treatment of computers to other parts of the information sector, and by accelerating the publication of some data. It is not too much to say that the NIPAs are what make modem empirical macro-economics possible. Those accounts are the organizing principle that enables us to see how the parts of the economy fit together. On one hand, they help economists track the way in which decisions made about work, consumption, and investment today determine how big the productive capacity of the economy will be next year. On the other hand, they show how those decisions, together with government spending and trade flows, evolve over time to determine the demand for each years production. The NIPAs are also the foundation of CBOs economic forecast, which underlies the baseline budget projections that the Congress needs to do its work. We use those accounts both to track what has happened in the past and to ensure that our assumptions for the future are internally consistent. The economy that BEA describes in the NIPAs does not stand still, but keeps changing its structure. In the past decade, forecasters and analysts have had to cope with a set of changes that have come to be called the new economy.
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