CBO Scoring and the Spin Meisters

The CBO report is honestly written and mercifully short, at only 24 pages, so perhaps Congress will read it, which might spark a more rationale debate within the House and Senate over costs and expected savings.

Four points in the CBO report make for interesting reading.

• First, regardless of whatever else occurs, the deficit will increase by a minimum of $500 billion dollar by 2019 if the Baucus plan is implemented. (page 3)
• Second, cutting Medicare for the elderly and decreasing spending on the Children's Health Insurance Program (CHIP) will be required, to contribute around $400 Billion in savings, to justify the Baucus plan. (page 16)
• Third, even after 10 years, 25 million Americans will still not have coverage. (page 9)
• Fourth, the CBO was not allowed to actually review the committee's legislative language that would turn the bill into law (page 7), so CBO did the best it could with what it was given and has extensive caveats of their analysis and the data.

One thing is clear: the Senate Finance Committee needs to work a bit on the "transparency" concept. CBO was forced to state: "the long-term budgetary impact could be quite different if those provisions were ultimately changed or not fully implemented" (Cover letter). "These projections assume that the proposals are enacted and remain unchanged throughout the next two decades, which is often not the case for major legislation" (page 9). In other words, the CBO's estimates are just guesses, and the real costs are almost certainly going to be higher.

CBO did the best they could with what they were given, which wasn't much. No one can know the true cost because, as CBO states, on page 17, their analysis "does not include federal administrative costs subject to appropriation or account for all effects on other federal programs."

Anyone who has worked in or with the federal government knows there are enormous execution risks for any, large government program, They usually end up taking longer to implement and costing more than anticipated. Unfortunately, instead of a frank discussion of the pros and cons of the CBO scoring, Americans have only heard spin, as too many elected members ignore the CBO warnings as they proceed blindly with their own agendas.

House Speaker Nancy Pelosi said : "There will be the votes for a public option and now it's a question of which one." Weird. No public option was included in the CBO scoring so the real long term costs of that plan have not yet been fully reviewed by CBO. Sen. Baucus understood this and clearly developed a plan without a public option; that's why CBO scored a plan without a public option. Yet, Speaker Pelosi speaks as if the CBO scoring did include a public option. Such deception does little to advance the debate.

Senate Majority Leader Harry Reid said: "the Finance Committee will vote on its health care reform plan next week. According to a new report from the non-partisan Congressional Budget Office, the plan meets the president's requirement that it not add a dime to the deficit." But that statement is flat wrong. The CBO makes it clear that the healthcare program will increase the deficit, which will only be reduced through cuts in existing programs, extensive taxes on individuals, and unless no further changes are made to the plan and no administrative costs are incurred. Not likely.

The White House said : "The analysis confirms that we can provide stability and security for Americans with insurance and affordable options for uninsured Americans without adding a dime to the deficit - and saving money over the long term." This statement, too, is inaccurate. CBO says the deficit will grow, and that 25 million American still will not have the coverage.

President Obama said : "I will not sign a plan that adds one dime to our deficits - either now or in the future. Period." By his own standard, the President will not be signing the Baucus bill, or any of the House legislation. The Baucus bill-- even with the offsets--still adds about $100 Billion to the deficit. Our country is not so wealthy that we should ever think $100 billion is a chunk change, rounding error.

Why is any of this important?

• First, our country no longer has the luxury, or the money, that allows bad decisions to be papered over with larger amounts of taxpayer bailouts. Our $1.6 trillion deficit has robbed us of the flexibility to fund other options if bad choices are made.
• Second, policy and new sweeping reforms must be centered on real facts and cost estimates. When Congress ignores the parts of a CBO report they don't like, then seizes on the most optimistic elements of the report, they do all Americans a disservice.

Our senior leaders seem steadfast in their desire to avoid all quantitative analysis and fact-based project implications. But, facts are stubborn things. Too many in Washington rely on their personal feelings of fairness and immeasurable ambitions when pursuing new policy, and avoid a more serious accounting of the actual cost estimates, and quantitative measurements of success or failure.

Let's hope that federal workers, such as those in the CBO, will continue to provide these needed facts with transparency and integrity, regardless of the way national leaders later spin and dance around the data.