Policy Watch

• CBO reports that bipartisan health care bill would reduce deficit by $4B over 10 years. A bipartisan health care bill sponsored by Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) would reduce the deficit by nearly $4 billion by 2027, according to a score released Wednesday by Congress’s nonpartisan scorekeeper, the Congressional Budget Office (CBO). The deal would fund key ObamaCare insurer subsidies and give states more flexibility to change their ObamaCare programs. The CBO added in its report on Wednesday that the bill would not substantially impact the number of people with health insurance. On the flip side, a CBO report released in August showed that not funding the insurer payments, called cost sharing reductions, would increase the federal deficit by $194 billion through 2026. [The Hill]
• Congressional Democrats introduce legislation to allow states to set up public option for health-care insurance. Sen. Brian Schatz (D-Hawaii) and Rep. Ben Ray Lujan (D-N.M.) are sponsoring a bill to give states the ability to set up a public option for health-care insurance. The bill has 17 cosponsors in the Senate, including Sen. Bernie Sanders (I-Vt.), who has offered his own single-payer government health-care plan, and Democratic Sens. Cory Booker (N.J.) and Kamala Harris (Calif.), potential 2020 presidential candidates. [The Hill]
• GOP congressional leaders scrambling to agree on tax deduction before budget vote. House Republican leaders are working to resolve a dispute between GOP tax writers and Republicans from high-tax states that could seriously impact Thursday’s budget vote. A handful of New York Republicans, along with a New Jersey lawmaker, are threatening to vote against the budget unless GOP leaders walk away from plans to eliminate a key federal deduction that people can take for the state and local taxes they pay. Eliminating the deduction would bring in an estimated $1.3 trillion in new tax revenue over a decade, which could be used to cover some of the cost of other tax breaks Republican leaders are considering. [Politico]

Economic Indicators & News

• U.S. durable goods orders increase 2.2% in September, vs. 1.0% expected increase. The Commerce Department reported on Wednesday that overall new orders for U.S.-made capital goods increased by 2.2%, more than expected, marking the eighth straight month with an increase. Non-defense capital goods orders excluding aircraft orders for durable goods rose 1.3 percent last month after an upwardly revised 1.3 percent increase in August. The data suggest that business spending on equipment remained robust in the third quarter. Economists polled by Reuters had predicted orders of core capital goods increase 0.5 percent last month after jumping 1.1 percent in August. Core capital goods orders rose 3.8 percent year-on-year. The shipments of core capital goods – used to calculate equipment spending in the government’s gross domestic product measurement – climbed 0.7 percent after soaring 1.2 percent in August. [CNBC]
• U.S. new home sales race to nearly 10-year high in September. Sales of new U.S. single-family homes rose unexpectedly in September, reaching the highest level in nearly 10 years. The Commerce Department reported on Wednesday that new home sales surged 18.9 percent to a seasonally adjusted annual rate of 667,000 units last month amid an increase in all four regions. This rate was the highest level since October 2007, following August’s upwardly revised sales pace of 561,000 units. The percent gain was the largest since January 1992. Sales soared 17.0 percent on a year-on-year basis in September. The data offers a positive outlook for the housing market regaining speed after appearing to stall in recent months. [Reuters]