AP Explains: CBO's independent views can rankle lawmakers


The Congressional Budget Office is a scorekeeper suddenly in the spotlight. 

Monday's estimate of the House GOP's health care measure gave ammunition to Democratic critics of the law, predicting that 14 million people would lose insurance next year. Republicans had been bracing for the report, with some of them attacking CBO as being inaccurate in past assessments. 

The obscure but respected agency, established under the 1974 budget act, provides cost estimates of legislation, baseline projections of the federal budget and its components, and independent economic and deficit statistics for lawmakers. 

It's counterweight to the Office of Management and Budget, which is part of a Democratic or Republican White House. 

Trump administration officials and some congressional Republicans preemptively criticized CBO ahead of its assessment of the cost and coverage in the Republican replacement to the Affordable Care Act. 

What you need to know about the CBO: 

Respected, not infallible 

CBO is respected for the nonpartisan rigor its 200-plus employees put into the 600 or so official cost estimates it performs each year — and the thousands of informal estimates it provides as committees draft legislation. But it's hardly infallible, especially when considering large, complex and far-ranging legislation like the Affordable Care Act. 

The agency's estimates, for instance, significantly overstated the number of people who would buy insurance on state and federal exchanges under the law, in part because it thought the individual mandate and accompanying tax penalties would be more effective in forcing people to buy insurance. 

"Predicting the effects of large policy changes is always difficult, but CBO's predictions for the (Affordable Care Act) in 2010 were much more accurate than the predictions of many Republican opponents of the law," said former agency chief Doug Elmendorf, who was appointed by Democrats. 

The agency was also way off in the early 2000s when it predicted large long-term budget surpluses that eased the way for large tax cuts in the George W. Bush era. 

A new sheriff in town 

Even as Republicans attack the referee, it should be remembered that they hired the referee. CBO Director Keith Hall, a conservative economist, was selected two years ago by Republican Tom Price, then the chairman of the House Budget Committee and now the secretary of the Department of Health and Human Services. 

Hall had been a critic of the Affordable Care Act and increasing the minimum wage. He has overseen an increase, long-sought by Republicans, in the use of "dynamic scoring" — in which the economic effects of tax changes and other policies are incorporated into CBO's analysis. CBO, for instance, has said Obama's health law has had a dampening effect on labor force participation and would slightly reduce growth. 

But CBO also disagrees with those who characterize "Obamacare" as in a "death spiral" and predicts that this year's big jumps in insurance premiums — averaging 21 percent nationwide — are actually likely to stabilize going forward with increases of 5 to 6 percent. That's because companies have been getting better information about the demographic traits of their customers. 

In Monday's report, CBO said the insurance market "would probably be stable in most areas under either current law or the legislation." 

Where you sit determines where you stand 

Criticism of the CBO is hardly new, but it is unusual to be coming from top officials like White House budget director Mick Mulvaney, who said Sunday on ABC's "This Week" that "estimating the impact of a bill of this size probably isn't the best use of (the CBO's) time." That remark sparked criticism from agency defenders on social media sites, where Peter Orszag, a former director of both the CBO and the Office of Management and Budget under President Barack Obama, wrote, "The former OMB and CBO director in me is speechless." 

But complaining about bad scores is nothing new. Democrats complained when drafting Obamacare; Republicans are carping now. 

"For more than 40 years, we've produced independent analysis of budgetary and economic issues," Hall said at a news conference in January. "The feedback I've always gotten is that we in general have a very strong reputation for our work. We try very, very hard to be independent and nonpartisan."


Reader Comments ...


Next Up in Politics

PolitiFact: Why Chick-fil-A shutdown on Facebook wasn’t fully cooked
PolitiFact: Why Chick-fil-A shutdown on Facebook wasn’t fully cooked

U.S. Sen. Ted Cruz, fresh from questioning Facebook founder Mark Zuckerberg at a hearing, asserted that Facebook inappropriately killed an appreciation day for Chick-fil-A, the fast-food restaurant. Was he correct? Cruz’s April 11 commentary on the Fox News website centered on what the Texas Republican described as Facebook’s suppression...
Sessions declines to recuse himself from probe into Trump lawyer
Sessions declines to recuse himself from probe into Trump lawyer

Attorney General Jeff Sessions has decided against recusing himself from the investigation into President Donald Trump's personal lawyer, Michael Cohen, but will consider stepping back from specific questions tied to the probe, according to a person familiar with the matter.  By contrast, Sessions recused himself from the investigation into Russian...
Amazon’s critics get new life with Trump’s attacks on the company
Amazon’s critics get new life with Trump’s attacks on the company

One of Amazon’s antagonists seized the moment last month with an unusual newspaper advertisement addressed to President Donald Trump. The ad, from a nonprofit that advocates less government, attacked a Defense Department technology contract that Amazon intends to bid on, calling it a lucrative handout for the company.  A top think tank critic...
Democrats fear Grassley special counsel bill amendment will let GOP tip off Trump about Mueller probe
Democrats fear Grassley special counsel bill amendment will let GOP tip off Trump about Mueller probe

Democrats are warning that the Senate Judiciary Committee chairman's proposed changes to a bill to protect special counsels from undue firing would give the GOP the ability to tip off President Donald Trump about developments in Robert Mueller's probe of him — the latest flash point on the legislation's rocky road to a committee vote, expected...
After Parkland shooting, NRA posts biggest fundraising haul in nearly 20 years
After Parkland shooting, NRA posts biggest fundraising haul in nearly 20 years

The National Rifle Association's Political Victory Fund raised $2.4 million in donations in March, setting a 21st-century fundraising record for the group in the month after a gunman killed 17 students and educators at a high school in Parkland, Florida.  The unprecedented fundraising haul came as gun control advocates, led by student survivors...
More Stories