And cutting the tax rate in a health bill would lower the revenue baseline, making it possible for backers of a deep rate cut to claim it is less expensive than it really is.
These included deep rate cuts around the world, as well as spending packages and other policy tools designed to help struggling companies, banks and consumers through the downturn.
The answers will drive how deep rate cuts can go and whether they carry an expiration date or remain embedded in a newly streamlined tax code.
Mr. Trump has been cool to that plan in interviews, and recently his advisers have been making the case that a surging economy, rather than Mr. Ryan's border adjustment tax, will pay for deep rate cuts.
But the budget does not detail the tax deductions, credits and loopholes that would need to be eliminated or cut back to finance such deep rate cuts, effectively leaving tax writers a $6 trillion hole to fill — a task that Democrats say is mathematically impossible without raising the tax burden on the middle class.
In a study of the lessons to be learned from Japan's decade-long slump, Fed economists said this summer that governments should take extraordinary steps to support prices -- like deep rate cuts or new spending -- when falling prices become a serious risk.
"The reforms likely will be enough to slow the dramatic rate increases, but they won't be sufficient to result in deep rate cuts," said Mark Sektnan, assistant vice president for state affairs with the American Insurance Assn.
Some of us would prefer him and the MPC to concentrate on how they can use their influence to help reduce the risk of a deep recession and surprise the market with a deep interest rate cut.
Treasury Prices Rise (Reuters) -- Treasuries rose yesterday after a report showed that the struggling manufacturing sector was stabilizing but still mired in a nine-month recession, supporting expectations for another deep interest rate cut by the Federal Reserve this month.
All eyes now are on Wall Street as leading financial advisers prepared for a Monday meeting with President Bush and the Federal Reserve weighs another deep interest rate cut Tuesday to stem even more deterioration.
