Congressional Budget Office Director Douglas Elmendorf said Tuesday that it would be much better for the economy if the sequester were replaced with phased-in deficit reduction, and that investments in infrastructure can provide a real boost to economic activity.

He also told members of the Senate Budget Committee during a hearing on CBO’s recently released annual Budget and Economic Outlook, that “the ongoing uncertainly about federal budget policy represents a drag on spending and thus on incomes and jobs,” but that CBO does not how to quantify that effect.

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