![]() ![]() Paul quotes from a CBO report which "estimates that productive federal investment has an average annual rate of return of about 5%, or half of the agency's estimate of the average rate of return on private investment." Paul argues that the CBO's projections suffer from one particular fundamental flaw that renders them largely useless: CBO estimates assume that public spending is only ever half as productive as private industry. The CBO's models are built from flawed assumptions that don't necessarily reflect how legislation might actually behave in the real world. They run these economic models that I think are the most important policy models out there."Īs we saw with Build Back Better last year, the CBO's models are regarded by lawmakers and the media alike as the gold standard of economic objectivity, and their reports can make or break a piece of legislation.īut the CBO, like any human institution, brings biases to their work - and it doesn't help that the current CBO director came from the American Enterprise Institute, a conservative think tank. "I like to call them the scorekeepers," Paul said. The Congressional Budget Office has always served a vital role in government, economist Mark Paul explains in the latest episode of the "Pitchfork Economics" podcast. The media uncritically picked up those CBO numbers, warning that the BBB "would add to national debt" as USA Today reported, and the New York Times offered a dire assurance in a headline that the BBB " Will Add to Deficit." Finally, just before Christmas, West Virginia Senator Joe Manchin cited the CBO's deficit warnings when he announced that he would not vote for the BBB, effectively killing the legislation. CNBC's Jacob Pramuk reported in November that the CBO found the BBB "would increase the budget deficit by $367 billion over the years 2022 to 2031." Last winter, as Congressional discussions over President Biden's proposed Build Back Better legislation were heating up, the Congressional Budget Office issued a cost-benefit assessment of the bill. When politicians make big, false claims about their policies, we must turn to independent analysts, like the CBO, to demonstrate the truth.Account icon An icon in the shape of a person's head and shoulders. If the score shows a bill would hurt the public, like cutting people off of their health insurance or wasting taxpayer dollars on tax cuts for the rich, demand they vote against it. Can CBO Scores Help Stop the Trump Agenda?Īsk your Members of Congress to demand that bills get a CBO score before they have to vote on them. They want to rush their repeal bill through before we know its true costs and how it will impact millions of people who have health insurance because of Obamacare. ![]() ![]() However, this time House Republicans are trying to pass their Obamacare repeal bill through committee without a score. Typically, the CBO will release its score before a vote is taken on a bill so that Members of Congress and their constituents can understand its impact. This estimate is known informally as a “score.”įor example, the last time Republicans passed an Obamacare repeal bill, the CBO score found that it would cut federal spending on health care assistance resulting in millions of Americans losing their health insurance. For every major bill, the CBO issues a report showing how a piece of legislation would change spending by the federal government as compared to current law, typically over a ten year period. What Is a CBO Score?Ī CBO “score” is just the price tag of a bill as determined by the CBO. ![]() It takes the light of the CBO’s “score” to truly understand what a bill means for our families and communities-and our wallets. Until we, as citizens, see the CBO estimate of a bill, we only have politicians’ talking points to go by to judge a bill’s impact. Regardless of who appoints the director (the current CBO director, Keith Hall, is a conservative economist appointed by Republican leaders), the CBO remains a respected independent source of information for lawmakers from both parties and the public. The CBO is nonpartisan-meaning it is independent and not just a political tool for the party in power. For forty years, the CBO has informed Congressional activities that will either reduce or increase government spending, issuing dozens of widely respected reports a year. And, on Capitol Hill, that price tag is often called a CBO “score.” The Congressional Budget Office (CBO) is Congress’s referee. The CBO provides independent cost analyses of legislation being considered by Congress-it basically puts a price tag on bills. ![]()
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