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CBO projections as political props


Glenn Greenwald has a nice catch here, on Matt Welch’s egregious hackery. Calling a document traditionally labeled a report a report ‘lying’ is pretty rich, but the larger issue is, as Greenwald demonstrates, Welch and Reason’s writers are perfectly happy to cite CBO “reports” as accurate and reliable when it serves their purposes to do so.

There’s a sense is which Welch is kind of right, of course–CBO budget forecasts change quite a bit from year to year. This kind of projection is just inherently speculative, as all kinds of important complicated factors for program cost and cost savings, including but not limited to the performance of the economy overall. Welch points readers to the Peter Suderman piece on the CBO, which isn’t bad, but doesn’t really offer much new information and insight, other than reiterating what we all knew–economic projections are volatile and uncertain. Suderman labels them “Gatekeepers” and means to suggest tehy are a powerful independent actors, but their power is rather clearly limited to the power politicians wish them to have. Somehow, CBO cost projections failed to prevent the Bush tax cuts or the Iraq war. Suderman obviously overstates the CBO’s independent political power; their power is clearly a product of other political actors.

Interestingly, Suderman cites this Jon Gabel op-ed from August, in which Gabel demonstrates that the CBO has systematically underestimated cost savings from previous Medicare reforms. If this is continuing to occur, then obviously the use of the CBO is making good HCR more difficult. The current director of the CBO responds to this and other charged here. On the other hand, the CBO dramatically underestimated the costs of the Iraq war. What I’d really like to see, though, is some more systematic data on the accuracy of the CBO’s projections, and the directional trend of their inaccuracy. (This may well be available, and if it is please point me to it. I’d conduct a more thorough search myself, but my current internet connection is intolerably slow.)

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