Senate Bill to Extend TRIA Could Increase Deficity by $5.1 Billion Over 10 Years
According to the Congressional Budget Office (CB0), a Senate bill extending TRIA, the federal terrorism insurance backstop, by seven years would increase the federal deficit by $5.1 billion over the next decade.
The budget score could cause headaches for proponents of extending the terrorism-risk insurance program, which obligates the federal government to pay a portion of losses from any future attacks that reach a certain threshold.
Under budget rules adopted by Democrats in both the House and Senate, any new spending by lawmakers must be offset by spending cuts or tax increases.
Congress has been rigorously lobbied by major carrierss such as Hartford Financial Services Group Inc., Travelers Cos. and American International Group Inc. to extend the program, which is set to expire at the end of the year.
Still, the CBO figure puts the Senate in a better position than its House counterparts. Previously, the budget office said a 15-year extension passed by House lawmakers in September would increase federal deficits by $8.4 billion over the next decade.
Supporters of an extension have questioned the CBO's estimates, which assume an increase in the deficit regardless of whether there is a terrorist attack. They point to the fact that the CBO says in its report that "there is no reliable way to predict precisely how much insured damage terrorists might cause, if any, in any specific year."
The nonpartisan budget office estimates the Senate version of the legislation would increase the deficit $3 billion over the next five years, compared with $3.5 billion by the House bill.
Source: Source: Wall Street Journal | Published on November 2, 2007
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