Study: Deficit-Financing Cut So-Called Bipartisan Infrastructure Bill’s Growth in Half

The Committee for a Responsible Federal Budget found in an analysis that the $1.2 trillion so-called bipartisan infrastructure bill’s deficit-financing cut the bill’s growth potential in half.

The Committee found that the so-called bipartisan infrastructure bill, or the Infrastructure Investment and Jobs Act, would create non-insignificant growth. However, the bill’s growth potential was stymied by its deficit financing.

The Congressional Budget Office (CBO) has noted the legislation would add $256 billion to the deficit over ten years as Americans continue to feel the pain of soaring inflation.

The Committee used a framework from the CBO to find that a fully-paid for so-called bipartisan infrastructure bill would boost Gross Domestic Product (GDP) by .12 percent by 2051 and boost economic activity; in contrast, the partially-offset infrastructure bill would boost real GDP by .05 percent by 2051.

“Beyond 2051, it appears a deficit-financed infrastructure plan would actually shrink annual output,” the Committee noted.

The Committee explained that “deficit-financed investments do less to increase output because increases in public investment are offset by reductions in private investment.”

This study follows other analyses, which have found that the legislation would not contribute much to economic growth.

The University of Pennsylvania’s Penn-Wharton Budget Model wrote that the Infrastructure Investment and Jobs Act would have “no significant impact” on economic growth.

The model found that the bill would result in $548 billion in additional spending, $132 billion in new taxes, and $351 billion in deficits, all of which would not lead to additional growth in GDP by 2031 or 2050.

The model also suggested that the bill would not boost Americans’ wages.

“Overall, workers’ productivity is unchanged, which is reflected in wages that do not change in 2040 and 2050,” the report read. “Overall, similar hours worked and lower private capital lower GDP, an effect that is offset by the productivity benefits of the infrastructure investment. Overall, GDP does not change in 2031, 2040, or 2050.”

Sean Moran is a congressional reporter for Breitbart News. Follow him on Twitter @SeanMoran3.