CBO: Obama policy will boost economy in short-term, not long-term

The independent Congressional Budget Office (CBO) said that President Obama's policies will do more to boost the economy over the next five years than current policies, but Obama's plans would do less to help the economy in the years after.

The president's policies would increase GDP by as much as 1 percent more than the baseline policy from 2010 to 2014. But the baseline policy would boost GDP more than Obama's proposals by anywhere from 0.3 percent to 1.9 percent from 2015 to 2019.

CBO Director Douglas Elmendorf, however, noted that the CBO's economic models aren't "well-suited" to projecting the effects of policy changes beyond five years.

The estimates came in a paper released Tuesday that slightly revised the budget office's deficit projections.

The deficit under Obama will reach $1.8 trillion this year and $1.4 trillion next year. It will fall to $633 billion in 2013, but will then rise in the years beyond, CBO's latest projections said. The CBO
said that the deficits over 10 years will add up to $9.1 trillion in debt, though that number is approximately $130 billion lower than the estimate the office gave in March.

Read the whole CBO study here.