Budget costs cannot be estimated like ordering fries
The name of Douglas Elmendorf will not likely be immediately recognizable to every reader. He’s one of the people who make government work — a bureaucrat.
At the moment, he heads the Congressional Budget Office. And his current situation gives us an idea of what we are getting for our money from putting the Republicans back in power.
The conservative magazine National Review recently quoted Gregory Mankiw, who chaired the Council of Economic Advisers under George W. Bush, about Elmendorf: “Someone recently said to me that the CBO director is not really a player in the political game. He is more like the referee. That analogy sheds light on why Doug is the right person for the job. What do you want in a good referee? Competence and impartiality. Doug has demonstrated both. He is a superb economist and, over the past six years as CBO director, has shown himself to be scrupulously nonpartisan.”
For instance, when President Bill Clinton proposed a health- care reform program in the early 1990s, a panel of which Elmendorf was a part provided budget estimates showing that the program would cost more than Clinton claimed. It helped undercut the credibility of the Clinton plan and helped lead to its defeat by Congress.
The Congressional Budget Office provides Congress with estimates of the cost of legislation. The CBO is one of several rare agencies in D.C. that the two parties have normally treated as sacrosanct — agencies with bipartisan legislative oversight that are expected to give Congress information it can trust. Besides CBO there is the Joint Committee on Taxation and Government Accountability Office.
Many measures that Congress processes come with price tags. Congress needs to know how much these bills will cost before they vote on them. The CBO estimates those costs for Congress.
Elmendorf is an opponent of something called “dynamic scoring,” which is basically adjusting estimates of the cost of legislation up or down to accommodate political interests. The sponsor of a bill would want the estimate to be fairly low. Its critics would want a high estimate. Dynamic scoring would taint the traditional trustworthy reputation of the Congressional Budget Office.
Republicans, fresh off their election victory, are blocking Elmendorf from being reappointed director of the office because of his opposition to dynamic scoring.
Interestingly, this is a problem Nevada has faced in the past. At one time, the job of estimating the cost of state programs belonged to the governor’s budget office. As a result, when a governor proposed a new or expanded program (or even a reduced program), he also controlled the budget estimates, and frustrated state legislators were often angered by governors who adjusted their estimates to get the program approved by the Legislature. By the time the estimates proved flawed, the program was already operating and the lawmakers had to make sense of it by allocating additional funds.
For instance, at the 1985 Nevada Legislature, Gov. Richard Bryan proposed raising the payment level of aid to dependent children. As it happened, the welfare division, which administered the program, had told the governor’s budget office that the monthly recipient level would likely be 15,400 a month, but the governor’s budget estimated a caseload of 13,500.
The legislature trusted the governor’s estimate and six months into the new budget, the program was running a deficit of a million dollars a month.
Nevada’s lawmakers eventually created the state Economic Forum, made up of tax and economic experts, to give independent budget estimates to the Legislature so the lawmakers need not rely on the governor, at least on the broad revenue figures. That’s essentially what the Congressional Budget Office does — provide reliable estimates that do not tailor figures to the needs of partisan leaders.
That the new Republican majority is seeking to get rid of a figure who has a reputation for standing up to budget tampering is alarming. In 2002 and thereafter, a GOP presidential administration ordered up intelligence claims like they were ordering burgers and fries at a driveup window and got us into an unnecessary war. Now, Republicans in Congress want a CBO chief from whom they can order whatever estimates can be tailored to their partisan needs.
Dennis Myers is a veteran Nevada journalist.
