“Dynamic Scoring Isn’t A Magical Tool”: Here’s How Conservatives Rig The Budget Game In Washington
When Republicans decided not to retain Doug Elmendorf as head of the Congressional Budget Office (CBO), Democrats became concerned that conservatives would try to rig the budget process. When the GOP required the CBO to use dynamic scoring for its legislative scores, Democrats became even more concerned. Those fears have proven overblown. The new CBO chair, whom Republicans announced last week, is Keith Hall, an economist at the Mercatus Center who was the commissioner of the Bureau of Labor Statistics under President Barack Obama. He’s a credible economist, not a partisan hack.
If you still want to see the budget gamed, though, look no further than the Tax Foundation’s score of Senators Marco Rubio and Mike Lee’s tax plan. The Foundation says that under a static scoring model, which doesn’t account for macroeconomic effects of the plan, the plan would cost the federal government $414 billion annually. That’s a huge amount of money. The government collects about $3 trillion a year in tax revenue, meaning the Rubio-Lee plan would be a 12.5 percent cut, a bold but unsurprising figure. Before Lee teamed up with Rubio, he released a first draft of his tax plan that reduced government revenue by an average of $240 billion a year. The new plan has even more tax cuts.
But when the Tax Foundation applies a dynamic scoring model to estimate the revenue effects of Rubio-Lee, the findings get downright wild. The Foundation projects that once the economy adjusts to the changes, it will grow enough to generate $508 billion (in 2015 dollars) in additional revenue each year. That would leave the American taxpayer with a cool $94 billion net annual gain.
To understand why this is so ridiculous, look at the Joint Committee on Taxation’s dynamic scoring estimates for the tax plan former Representative Dave Camp released last year. (The JCT produces revenue estimates for CBO.) The JCT used eight different dynamic scoring models and provided eight different estimates. “The increase in projected economic activity is projected to increase revenues relative to the conventional revenue estimate by $50 to $700 billion, depending on which modeling assumptions are used, over the 10-year budget period,” the report concluded. Now, $700 billion is nothing to sneer at, but that’s over a ten-year period. The Tax Foundation’s dynamic scoring model raised nearly that amount of additional revenue every single year.1
This is a slightly different comparison, because JCT’s numbers come from the 10-year period while the economy adjusted to the tax plan versus the Tax Foundation’s numbers, which are from after the economy full adjusted. The difference is still stark.
Once the Foundation releases the full report Monday, Rubio and Lee will surely cite the numbers ad nauseam to gin up favorable coverage and analyses of the proposal. The Tax Foundation is giving Rubio and Lee a major political boost by producing such a friendly score.
I’m sure the Foundation’s economists would disagree that they are doing the two senators a huge favor. They would say that the Rubio-Lee plan is far friendlier to economic growth than Camp’s plan was. Maybe they’re right. But it’s not that much friendlier. These numbers are far beyond any realistic estimate of Rubio-Lee’s macroeconomic effects. And it’s basically impossible to produce realistic estimates to start. “Theoretically dynamic scoring is the right thing to do,” Peter Orszag, who was director of CBO under President Barack Obama from 2007 to 2008, told me in January. “Just practically, it’s problematic. When you’re forced to pick one model, you’re pushing scientific knowledge beyond reality. You’re forcing the organization to pick one ‘true’ model when the economic science hasn’t produced a single model that works.”
Many conservative economists agree. Douglas Holtz-Eakin, a former CBO director, has frequently said that dynamic scoring isn’t a magical tool to make huge tax cuts look fiscally responsible. Greg Mankiw, who was the top economist for President George W. Bush from 2003 to 2005, recently wrote in the New York Times that while dynamic scoring is theoretically correct, “there are also good reasons to be wary of the endeavor.”
If Republicans had required that the CBO and the JCT use the Tax Foundation’s dynamic scoring model, it would have been a major problem. At least now the two parties accept the CBO’s score as legitimate. If they demand a bill to be deficit-neutral, the CBO is the final arbiter. That would all change if the Tax Foundation’s models were used. Of course, the actual likelihood of that happening was never clear. But if Republicans had required such changes, Democrats would never have trusted any score on any legislation—and rightfully so.
The two sides have enough trouble agreeing to pass anything today. It would be that much harder if they couldn’t even agree on the scores of legislation. You can understand why Democrats were so nervous as Republicans debated how to change the agencies.
1This is a slightly different comparison, because JCT’s numbers come from the 10-year period while the economy adjusted to the tax plan versus the Tax Foundation’s numbers, which are from after the economy full adjusted. The difference is still stark.
By: Danny Vinik, The New Republic, March 5, 2015
“Boehner’s Latest Humiliation”: Surrender; Government-By-Crisis Fails The GOP Again
Ever since Republicans first devised their ill-conceived plan to use funding for the Department of Homeland Security as a hostage in hopes of forcing President Obama to abandon his immigration policy, the gambit was doomed to eventual failure.
On Tuesday, the debacle reached its logical conclusion. Hours after Speaker John Boehner (R-OH) acknowledged defeat, the House of Representatives ended the game and passed a bill funding DHS through September, without preconditions. The bill passed the house 257 to 167, with just 75 Republicans joining the Democratic minority to keep the department open.
There was never any real doubt that this would be the outcome. Since the equally poorly-thought-out government shutdown of 2013, President Obama has made it clear that he will not give in to Republican attempts to use must-pass spending bills to blackmail him into dismantling his agenda. The Department of Homeland Security was always a poor target for a hostage, given its importance to national security — and the fact that shutting it down would do nothing to stop President Obama’s executive actions on immigration. And voters were always going to blame Republicans, not Democrats, for a crisis that the GOP created.
Still, House Republicans insisted on dragging the crisis out until the last second, and managed to undermine Speaker Boehner’s tenuous authority in the process. Yet again.
So will this latest humiliation convince Boehner and his caucus to rethink their strategy of government-by-crisis? It’s unlikely; if the “fiscal cliff,” the government shutdown, and repeated debt ceiling standoffs (among other House-made emergencies) didn’t change their course, there’s no reason to believe that the DHS near-shutdown will be different.
In related news, on Tuesday the Congressional Budget Office announced that the debt ceiling will have to be increased in October or November.
By: Henry Decker, The National Memo, March 3, 2015
“The GOP Gang Of Supremes Go After Obamacare”: This Lawsuit Was A Fraud From The Get-Go
Look out — the Supreme Court’s black-robed gang of far-right ideologues is rampaging again! The five-man clan is firing potshots at Obamacare — and their political recklessness endangers justice, the Court’s own integrity, and the health of millions of innocent bystanders.
In an attempt to override the law, these so-called “justices” have jumped on a wagonload of legalistic BS named King v. Burwell. But that case is a very rickety legal vehicle. It sprang from a frivolous lawsuit concocted in 2010 by a right-wing front group funded by such self-serving oligarchs as the Koch brothers, Big Oil, Big Tobacco and Big Pharma. The chairman of the front group was neither delicate nor discreet in describing the purpose of the lawsuit as a raw political assault on Obamacare: “This bastard has to be killed as a matter of political hygiene,” he howled at the time. “I do not care how this is done, whether it’s dismembered, whether we drive a stake through its heart … I don’t care who does it, whether it’s some court someplace or the United States Congress.”
So much for the intellectual depth of the King case, which was fabricated on a twisted interpretation of only four words in the 906-page health care law. The plaintiffs claim that the law prohibits insurance subsidies to the millions of low- and middle-income Americans living in the 36 states that did not set up a state exchange — thus making health care unaffordable to millions of hard-working Americans and small businesses who are purchasing insurance on the federal exchange—essentially nullifying the heart of Obamacare.
Both the district and appeals courts rejected that perverse ideological tommyrot, and even the nation’s largest health care provider called the claim “absurd.” Nonetheless, the gang of Supremes grabbed the case as a chance to wreak their own brand of ideological havoc on a law they personally dislike.
By taking over this case, these Republican judges have openly become partisans, thrusting the Supreme Court itself into the forefront of the GOP’s war against Obamacare — and against Obama himself.
While we know that an anti-government group funded by plutocratic corporate powers is behind the lawsuit intended to terminate Obamacare — who are the four people who are out front as the actual plaintiffs in the case?
The Competitive Enterprise Institute is the corporate front, but it had no standing to sue, so it had to find some actual people who would claim they’ve been harmed by the health care law. Thus, David King, a 64-year-old Vietnam vet, was recruited to be the lead plaintiff in King v. Burwell, which is now in the Supreme Court’s hands. He and three co-plaintiffs were chosen to put sympathetic human faces on what essentially is a right-wing political ploy.
But who are they? An investigative article in Mother Jones magazine by Stephanie Mencimer reveals that King’s modest income as a self-employed limo driver exempts him from Obamacare’s insurance mandate — so he’s been done no harm by the law and, therefore, has no standing to sue. Moreover, as a veteran, he’s entitled to VA care and, in a few months, to Medicare, making him double-covered by public health programs. Mr. King’s main reason for being on CEI’s lawsuit appears to be that he loathes Obama, referring to him as “a joke” and “the idiot in the White House.”
None of the three other recruits seem to have been harmed by Obamacare, either. “I don’t know how I got on this case,” says Brenda Levy, adding that, “I don’t like the idea of throwing people off their health insurance.” Then there’s Rose Luck, whose low income also exempts her from the law’s mandates. But she, too, fiercely loathes Obama. She posted on her Facebook page that she “wouldn’t admit he was our president,” calling him “The anti-Christ” who only won the Oval Office because “he got his Muslim people to vote for him.”
This lawsuit was a fraud from the get-go — and if five Supremes use it to take away the health coverage of some 10 million Americans, they’ll also be exposed as rank political hatchetmen masquerading as “justices.”
By: Jim Hightower, The National Memo, March 4, 2015
“Be Very Afraid Of ‘King v. Burwell'”: It’s Whether Or Not The United States Has Essentially Become A Banana Republic
There was a society of men among us, bred up from their youth in the art of proving, by words multiplied for the purpose, that white is black, and black is white, according as they are paid. To this society all the rest of the people are slaves.
–Jonathan Swift, Gulliver’s Travels, 1726
The real question before the Supreme Court in the ballyhooed case of King v. Burwell isn’t merely the continuance of the mandated health insurance subsidies of “Obamacare.” It’s whether or not the United States has essentially become a banana republic — an oligarchy whose legal institutions exist to provide ceremonial cover for backroom political power plays.
Almost regardless of what you think of the Affordable Care Act, legalistic chicanery of the kind on display shouldn’t be rewarded. That King v. Burwell has reached the high court is bad enough. Should the Roberts Court hand down a 5-4 decision based upon a tendentious misreading of the statute, several things will happen: An estimated 8.2 million Americans will lose health insurance coverage, the U.S. health care system will be thrown into economic chaos, and a few thousand citizens will no doubt die.
To a certain kind of person styling himself “conservative,” this would be perfectly all right. In an op-ed titled “End Obamacare, and People Could Die. That’s Okay,” one Michael R. Strain argues that higher death rates are “an acceptable price to pay for certain goals,” including “less government coercion and more individual liberty.”
Acceptable to Strain and his colleagues at the American Enterprise Institute, that is, a plutocrat-funded Washington think tank whose resident “scholars” are handsomely paid to mimic the values of 19th-century Russian aristocrats.
Along with the human casualties, the U.S. Supreme Court’s prestige as a fair arbiter would also be irrevocably damaged. As New York Times legal correspondent Linda Greenhouse argues, “The Court has permitted itself to be recruited into the front lines of a partisan war. Not only the Affordable Care Act but the Court itself is in peril as a result.”
And that would damage what’s left of American democracy.
During his 2005 confirmation hearings, Chief Justice Roberts likened himself to an umpire. His job would be to call balls and strikes, not to reinvent the rules of baseball. It was a very shrewd formulation, as most Americans prefer a non-partisan judiciary. “It is a very serious threat to the independence and integrity of the courts to politicize them,” Roberts has said repeatedly.
With the signal exception of Citizens United, a 5-4 decision invalidating campaign finance laws and pushing the nation in the direction of plutocracy, some observers do credit the Chief Justice with making an effort to move the Court away from overt partisanship. Almost two-thirds of recent Supreme Court rulings have been unanimous.
However, Roberts’ deciding vote legitimizing Obamacare’s insurance mandate infuriated many Republicans. They see in King v. Burwell an opportunity for the Chief Justice to redeem himself. All he needs to do is persuade a majority of the Justices, presumably including himself, that because the Affordable Care Act speaks of subsidies being available through a health insurance “exchange established by a state,” it means only, exactly, and literally that.
If your state—say, New York—set up and ran its own marketplace, then you’re eligible for Obamacare.
If not, you’re not.
No more health insurance subsidies for residents of Texas, Oklahoma and 32 other states that let the feds set up exchanges for them.
Never mind that the law specifically requires the U.S. Department of Health and Human Services to “establish and operate such exchange[s] within the states.” Never mind that nobody anywhere understood the Affordable Care Act to have such a restrictive meaning when it was being debated, enacted and put into operation. Such an interpretation certainly never came up during the difficult period when the HealthCare.gov website labored to get up to speed.
Never mind too that time-worn Supreme Court precedents direct judges interpreting laws to consider not isolated snippets of language, but “the specific context in which that language is used, and the broader context of the statute as a whole.” (The wording is from a 1997 opinion by Justice Clarence Thomas.)
For that matter, if anybody in Congress on either side thought the law meant what the plaintiff’s lawyers in King v. Burwell claim, why have we been having the political battle of the century about it? Why vote 56 times to repeal a law that only applies in 16 of the 50 states?
It’s an odd form of legalistic fundamentalism the justices must consider, the constitutional equivalent of a guy trying to beat a ticket for driving 95 mph in a school zone because a typo reads “ozone.”
The wonder is that the Court elected to hear the case at all after a three-judge appeals court in Richmond rejected it unanimously.
And the scary question is why?
By: Gene Lyons, The National Memo, March 4, 2015
“Netanyahu’s Missed Opportunity”: And If Bibi Is Correct, The Real Solution Is … What Exactly?
All eyes were on Capitol Hill this morning, when Israeli Prime Minister Benjamin Netanyahu delivered a speech to a joint session of Congress, hoping to undermine nuclear diplomacy with Iran. Everyone involved in the debate, regardless of their position, had a pretty good idea as to what the Israeli leader was going to say, and he met expectations.
A senior administration official told Jake Tapper there was “literally not one new idea” in Netanyahu’s speech, and “not one single concrete alternative” to the ongoing P5+1 talks. The official added that the prime minister’s speech was “all rhetoric, no action.”
The complaints have the benefit of being true.
Putting aside the fear-mongering and the Cheney-esque rhetoric, what Netanyahu’s remarks boiled down to was a straightforward message: Iran is bad and the deal that’s coming together with Iran won’t work. What Netanyahu’s speech was supposed to do was offer policymakers and critics of the talks a viable alternative solution, and on this front, the prime minister blew it. As Jon Chait noted:
Netanyahu’s panicked plea for what he called ”the survival of our country” is hardly a figment of his imagination. His recitation of the evils of Iran’s regime was largely correct. He might conceivably be correct that the Obama administration could have secured a stronger deal with Iran than the one it is negotiating, though that conclusion is hard to vouchsafe without detailed knowledge of the negotiations. […]
But Netanyahu did not make even the barest case for a better alternative.
It’s a familiar problem for President Obama’s critics: there’s an obvious problem in need of a solution; there’s a proposal preferred by the White House; and there are Obama’s critics, insisting they hate the president’s solution without offering a credible alternative of their own.
It’s not that Netanyahu critique is necessarily unpersuasive. Iran does not have a trustworthy track record, and no one in the Western world thinks it’d be a positive development for Tehran to have nuclear weapons. In fact, Obama has already said all of this; it’s an accepted consensus.
But it’s the case the Israeli leader builds on this foundation that’s problematic. For Netanyahu, no deal with Iran will work. No system of inspections will work. No verification process will work. No promises from Iran can be trusted.
And if Netanyahu is correct, the real solution is … what exactly? The prime minister had the platform to present a more effective vision, but he chose not to present one.
Perhaps the message was implicit and unstated. Maybe the audience was supposed to simply understand that Netanyahu prefers a military solution, disrupting an Iranian nuclear program through airstrikes. But (a) if that is the prime minister’s solution he should say so; and (b) there’s no reason to assume that a military campaign against a possible Iranian threat will permanently derail the country’s nuclear ambitions. On the contrary, it might even do the opposite.
“The alternative to this bad deal is a much better deal,” he told American lawmakers today. In theory, that sounds great – better deals are always, by definition, superior to bad deals. But where is this elusive better deal? What are its details? How would it receive international support? How would it be implemented?
Netanyahu didn’t, and wouldn’t, say. What a missed opportunity.
Postscript: At one point, the prime minister said, “I can only urge the leaders of the world not to repeat the mistakes of the past.” This isn’t what Netanyahu meant, one of the mistakes of our recent past was listening to him when he said invading Iraq was a great idea. If we’re going to avoid repeating mistakes, maybe we can start here.
By: Steve Benen, The Maddow Blog, March 4, 2015
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