Congressional Budget Office

ObamaCare was not fiscally responsible

Over at Reason, Peter Suderman breaks apart the claims of fiscal responsibility by the Obama Administration and Democrats that supported the health care “reform” legislation this spring:

[T]o hear the bill’s supporters explain it, ObamaCare constitutes a triumph of fiscal responsibility, lowering the deficit, extending the solvency of Medicare, and reining in the growth of health care costs. Rep. Bart Stupak (D-Mich.), a staunch pro-lifer who assured the bill’s passage by deciding to vote yes at the last minute despite misgivings about abortion funding, declared that the legislation would provide “health security and financial security” to Americans. “This is a good bill for the American people,” he told MSNBC. “We’re not adding to the deficit. Indeed, the CBO [Congressional Budget Office] says the bill will actually reduce the deficit over time.”

This argument was crucial to the bill’s success. In the preceding week, it became increasingly clear that several votes were contingent on the bill’s receiving certain scores from the CBO. And when the scores—a $940 billion price tag for the first 10 years, $138 billion worth of deficit reduction in the first decade, and $1.2 trillion worth of reduction in the following 10 years—came through, many wavering Democrats hopped on board.

Cost of ObamaCare goes up

Guess what? ObamaCare is going to cost more than Democrats claimed, according to a new analysis by the Congressional Budget Office:

The Congressional Budget Office has doubled the estimated increases of some costs resulting from the sweeping health care reform legislation passed this year.

A CBO report sent Tuesday to Rep. Jerry Lewis of California, the ranking Republican on the House Appropriations Committee, said the estimated rise in discretionary spending - which is spending requiring annual congressional authorization - over the first 10 years under the new legislation could exceed $115 billion.

On March 11, exactly two months earlier, the non-partisan CBO reported the estimated increase for discretionary spending could exceed $55 billion.

Douglas Elmendorf, the CBO director, said the latest report “updates and expands” on the previous report. He noted that assessing effects on discretionary spending was speculative because such appropriations require congressional action, and could be larger or smaller than initially anticipated.

The health care legislation was estimated by CBO to cost $940 billion over 10 years and reduce the federal deficit by $143 billion over the same period.

CBO head acknowledges flaws in stimulus reporting

We all knew that the “created or saved jobs” rhetoric was a red herring. The administration’s attempt to spin declining jobs after passing massive Keynesian-style spending to “bring us from the brink.” The Congressional Budget Office has gone along with it, but recently we got some truth from the head of that government agency:

CBO director Doug Elmendorf has finally conceded that they never actual examined this stimulus bills’ affect on the economy. Responding to a questioner following a recent speech, he admitted that the CBO’s jobs count was “essentially repeating the same exercise” as their initial projections. When asked if this means their jobs projections would have ignored any failures of stimulus spending to perform as CBO predicted, Mr. Elmendorf responded “that’s right.” (Exchange begins at 38:20.)

CBO never actually counted the jobs. Nor did their analysis take into account the rising unemployment rate. Or the economic figures. Or how effectively the money was spent. They merely assumed this government spending “must have” saved 1.5 million jobs.

There you have it. Now, if only the media give it some attention.

Social Security paying out more than it takes in

What was thought to be a few years away is now suddenly a reality. Social Security will run a deficit this year, according to The New York Times:

This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.

Stephen C. Goss, chief actuary of the Social Security Administration, said that while the Congressional projection would probably be borne out, the change would have no effect on benefits in 2010 and retirees would keep receiving their checks as usual.

The problem, he said, is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program’s revenue has fallen sharply, because there are fewer paychecks to tax.

What else do you expect from this Ponzi scheme?

Over at The Liberty Papers, my friend Brad Warbiany explains the Social Security system in a way that even “progressives” can understand:

Yesterday I had $10 in my right pocket.

I loaned that money to my left pocket, which I like to call my “Right Pocket Trust Fund”. I put an IOU from my left pocket into my right pocket to document the loan.

I then spent that $10 on lunch.

Today my right pocket wants to start collecting on that loan.

That’s the Social Security Trust Fund. An IOU that requires new taxation, NOT drawing down on savings, to be repaid.

Chart of the Day: Another look at federal spending

Over at Cato, Dan Mitchell provides us with a look at future federal spending, based on CBO numbers. We posted something like this not too long ago, but after the passage of ObamaCare, it’s worth another look.

Future Spending

Medicare “doc fix” increases cost of ObamaCare, causes deficits

Rep. Paul Ryan (R-WI) asked the Congressional Budget Office to include the Medicare “doc fix” in its estimates for ObamaCare, which has been specifically excluded to help keep down estimated costs. If the fix were included, the cost of the bill would have exceeded $1.1 trillion, making it much tougher to sell the bill to members.

Here’s the story:

Congressional budget scorekeepers say a Medicare fix that Democrats included in earlier versions of their health care bill would push it into the red.

The Congressional Budget Office said Friday that rolling back a programmed cut in Medicare fees to doctors would cost $208 billion over 10 years. If added back to the health care overhaul bill, it would wipe out all the deficit reduction, leaving the legislation $59 billion in the red.

The so-called doc fix was part of the original House bill. Because of its high cost, Democrats decided to pursue it separately. Republicans say the cost should not be ignored. Congress has usually waived the cuts to doctors year by year.

One of the big talking points for Democrats is the long-term deficit reduction (past the first decade). The CBO says the “doc fix” and other factors could change that (emphasis mine):

ObamaCare update: CBO score, deem-and-pass and options in the Senate

Yesterday, the Congressional Budget Office (CBO) released a preliminary score of ObamaCare that shows an estimated cost of $945 billion over the next 10 years (text of the reconciliation bill was posted online, as well). The CBO also estimates that the legislation will result in deficit reduction of $138 billion over the same period of time. The report also indicates that 98% of the spending in the bill in the first decade comes in the last six years.

Because the estimate came in under $1 trillion, House Democratic leaders feel this helps their cause. Of course, the reason it comes in under $1 trillion is because Democrats tweeked the excise tax on health insurance plans. The legislation is also missing the $300 billion doc fix, which will come out separately.”

Also, it’s important to remember that the CBO score wasn’t a final analysis of the bill if you actually read it (emphasis mine):

UPDATED: CBO Estimates New Health Care Bill Will Cost $940 Billion Over Ten Years

The Congressional Budget Office has released it’s estimate for the latest version of ObamaCare:

The Democratic health care bill would cost $940 billion over 10 years and cut the federal deficit over the next two decades – figures that should help ease the worries of fiscal hawks who have been reluctant about supporting the sweeping measure.

The bill would reduce the deficit by about $130 billion in the first 10 years, and by $1.2 trillion over the second 10 years. It will expand coverage to 95 percent of Americans, according to Congressional Budget Office figures released Thursday by House Democrats.

The numbers allow Democrats to push ahead with a vote Sunday, even as Speaker Nancy Pelosi (D-Calif.) continues to search for the 216 votes needed for passage.

“We’re on track for a Sunday vote,” Majority Leader Steny Hoyer (D-Md.) told reporters.

Of course, if you believe that these numbers are even close to what the actual cost of this program is going to be, or that the deficit savings are anything but mythical, I’ve got a bridge to sell you.

But, this means the process moves forward. The next step will be to see what the House Rules Committee decides to do.

UPDATE:  Below is a copy of the actual analysis from the CBO.

ObamaCare update: Latest vote count, who is on the fence, Slaughter Solution and AP fact check

Republicans started Wednesday off with 37 Democrats firmly against or leaning against voting for ObamaCare. That number dropped to 36 after Rep. Dennis Kucinich (D-OH) traded his vote for a ride on Air Force One, or as someone said on Twitter, a chance to sit in the “big boy chair.”

Kucinich had been firmly against the bill because he supports a single payer, government run system. No doubt he got reassurances from President Barack Obama, who has said that his plan is another step in that direction.

Other vote counts indicate that Republicans are still in the game. Byron York counts 209 members against the bill, 204 in support of it and only 18 undecided members. The count over at Fire Dog Lake is 209 against and 205 in favor.

One thing is clear, the only thing bipartisan about this vote is the opposition.

Who are the undecided members?

Here is a list of members that may be sitting on the fence. Some of them probably know how they are voting and are trying to get some thing out of the reconciliation package or a project in some other bill.

Just call these members.

If Republicans Are Serious About Small Government, Why Are They Ignoring Paul Ryan?

Marc Ambinder notes that when it comes to reducing the size of government, there’s fairly solid evidence that most Republicans in Congress aren’t walking the walk:

Paul Ryan is the Republican idea man of the hour. Karl Rove endorsed Ryan’s approach to budget reform on Glenn Beck, and whenever Republicans are asked about their preferred alternatives to the administration’s deficit reduction intentions, Ryan’s name and proposals are offered up. Hey, Republicans have ideas too. We don’t need health care reform to reduce the deficit — at least not yet.

So prominent Republicans  — particularly those running for president and those who aren’t elected officials — love Paul Ryan when it’s convenient. Why is it, then, that only twelve members of the conference were willing to attach their names to his bill — and none from the leadership? One reason is that Ryan is introducing it in his capacity as a member — not as the ranking member of the budget committee.

The other reason? Maybe they don’t want to be associated with what is a pretty far-ranging radical proposal:

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