I agree completely with Brad DeLong (the "technocrat" reaction) and Kevin Drum about the CBO's strange decision to include future changes in the ACA as part of their alternative fiscal scenario.
A quick explanation...part of CBO's job is to let Congress (and the rest of us) know what is likely to happen to the budget well into the future. That's difficult enough because it requires guesses about long-run demographic and economic trends, which become wilder and wilder guesses as they go farther into the future. It's even trickier if everyone knows that there are certain things that Congress is going to do that are not reflected in current law. So CBO, quite sensibly, does separate estimates: one for current law, and one for what everyone knows is going to happen.
Of course, the latter is tricky. There are a two significant easy ones: the alternate minimum tax, and the doc fix. The baseline, in each case, is clearly phony; every year, Congress takes action to change the law so that the "baseline" (that is, current law) -- which no one wants, in either party -- does not take effect. Others are more complex. It's pretty clear that majorities of Congress want some of the Bush tax cuts to continue (while under current law they would expire), but there's a lot of uncertainty about what's actually going to happen.
But the ACA? Democrats just passed it; they presumably support the changes in taxes and Medicare spending that they just voted for. Republicans, to be sure, opposed it, including those two things...but it's hardly CBO's job to estimate the effects of the minority party's agenda, let alone a selective portion of that agenda. At any rate, there's a huge difference between something that both parties say they intend to do, and which they've done many times, compared to something that only one (currently minority) party says it intends to do, but has never done before.
Drum sums it up nicely:
A quick explanation...part of CBO's job is to let Congress (and the rest of us) know what is likely to happen to the budget well into the future. That's difficult enough because it requires guesses about long-run demographic and economic trends, which become wilder and wilder guesses as they go farther into the future. It's even trickier if everyone knows that there are certain things that Congress is going to do that are not reflected in current law. So CBO, quite sensibly, does separate estimates: one for current law, and one for what everyone knows is going to happen.
Of course, the latter is tricky. There are a two significant easy ones: the alternate minimum tax, and the doc fix. The baseline, in each case, is clearly phony; every year, Congress takes action to change the law so that the "baseline" (that is, current law) -- which no one wants, in either party -- does not take effect. Others are more complex. It's pretty clear that majorities of Congress want some of the Bush tax cuts to continue (while under current law they would expire), but there's a lot of uncertainty about what's actually going to happen.
But the ACA? Democrats just passed it; they presumably support the changes in taxes and Medicare spending that they just voted for. Republicans, to be sure, opposed it, including those two things...but it's hardly CBO's job to estimate the effects of the minority party's agenda, let alone a selective portion of that agenda. At any rate, there's a huge difference between something that both parties say they intend to do, and which they've done many times, compared to something that only one (currently minority) party says it intends to do, but has never done before.
Drum sums it up nicely:
The CBO does itself a disservice if it starts getting too heavily involved in political calculations like this. They've already made their best estimates about what effect healthcare reform will have on the federal budget, and if they want to change those estimates they should do so openly. But simply assuming that a future Congress will kill all cost savings measures with no special evidence to back that up? That's just not their job. CBO is supposed to be an honest broker, not a Washington Post op-ed columnist.
