Catch of the Day: Republicans' CBO Delusions

Why do Republicans want the Congressional Budget Office to use a method that would disguise deficits?

This chart has quite a title.

Photographer: Brendan Hoffman/Bloomberg

A Catch to former Obama administration economist Jared Bernstein who gives a nice summary of the case for the Congressional Budget Office  and suggests some helpful changes.

He’s reacting to a Wall Street Journal editorial suggesting abolishing the CBO and the Joint Tax Committee. Now, I believe politicians, not bureaucrats, should make decisions, but politicians need information. The reason the CBO was invented wasn’t about larger or smaller government; it was to give Congress enough technical information so the politicians on Capitol Hill could effectively compete with the politician in the White House who has the Office of Management and Budget,  a Council of Economic Advisers and other staff providing him with technical information. Eliminating the CBO would make Congress and its individual members weaker, not stronger.

Bernstein (no relation) is also reacting against the proposed “dynamic scoring” of tax proposals:

Dynamic scoring calls for adding macroeconomic impacts to budget estimates. If, for example, your model of the economy is jiggered to show that cutting taxes boosts productivity, labor supply and growth, then said growth can be tapped to offset the revenue lost by the tax cut. CBO doesn’t go there, because there’s insufficient evidence that such macroeconomic feedback effects can be reliably estimated.

Yes, it’s technical. In political terms, however, the meaning is simple: The point of dynamic scoring is to make tax cuts look as if they will cost the treasury less money. At the least, the practice is questionable, and anyone who cared about federal budget deficits would want to make the CBO’s estimates conservative, so that any mistake would result in a smaller deficit. This is what Democrats did when the office refused to count potential Affordable Care Act savings; they found other ways to make it work rather than instructing the CBO to change its methods. 1

So if Republicans switch to dynamic scoring, it will be clear they don’t care about deficits. But that isn't news to those of us who have followed their war on budgeting in the first place.

Nice Catch!

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  1. Yes, Democrats gamed the Congressional Budget Office, but not, for the most part, in ways that would risk larger deficits. For example, Democrats pushed off implementation of Obamacare to keep 10-year cost estimates artificially low, but that had no effect on long-term costs or the deficit.

To contact the author on this story:
Jonathan Bernstein at

To contact the editor on this story:
Katy Roberts at

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