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Author Topic: Government programs & regulations, spending, deficit, and budget process  (Read 241406 times)
G M
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« Reply #1000 on: June 26, 2017, 04:53:32 PM »

Different legal questions presented when the borrower is not one of the fifty states of the USA.

Can we remove Illinois status as a state? Make it a federal territory?
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Crafty_Dog
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« Reply #1001 on: June 27, 2017, 01:23:18 AM »

Sell it off in pieces to neighboring states.
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DougMacG
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« Reply #1002 on: June 27, 2017, 08:11:24 AM »

Crafty, [Illinois]:  "Sell it off in pieces to neighboring states."

This is a great idea.  It's a state, if you can keep it.  The threat of splitting it up might be what they need to decide to fix it.  The idea that free money repairs bankruptcy makes all budget gaps impossible to close.

Illinois already has the highest overall tax burden in the country, or in the top three depending on how you measure it.  The problem is the spending stupid.

I would take rural and small town Illinois any day.  Chicago will be harder to sell.
« Last Edit: June 27, 2017, 08:29:52 AM by DougMacG » Logged
G M
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« Reply #1003 on: June 27, 2017, 08:16:52 AM »

Crafty, [Illinois]:  "Sell it off in pieces to neighboring states."

This is a great idea.  It's a state, if you can keep it.  The threat of splitting it up might be what they need to decide to fix it.  The idea that free money repairs bankruptcy makes all budget gaps impossible to close.

Illinois already has the highest overall tax burden in the country, or in the top three depending on how you measure it.  The problem is the spending stupid.

I would take rural and small town Illinois any day.  Chicago will be harder to sell.



Perhaps Chiraq could be walled off to protect the surrounding areas.
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ccp
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« Reply #1004 on: July 02, 2017, 08:49:25 PM »

http://www.wnd.com/2017/06/the-best-anti-poverty-program-is-just-17-words/
« Last Edit: July 02, 2017, 09:19:17 PM by Crafty_Dog » Logged
Crafty_Dog
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« Reply #1005 on: July 02, 2017, 09:57:23 PM »



    Opinion Best of the Web

Could Trump Really Be Draining the Swamp?
The water appears to be receding at key Beltway bureaucracies.
President Donald Trump and Secretary of State Rex Tillerson in the Cabinet Room of the White House on Friday.
President Donald Trump and Secretary of State Rex Tillerson in the Cabinet Room of the White House on Friday. Photo: brendan smialowski/Agence France-Presse/Getty Images
By James Freeman
June 30, 2017 3:17 p.m. ET
1287 COMMENTS

The Senate still hasn’t voted on ObamaCare reform, U.S. workers are still waiting for tax cuts to drive economic growth and President of the United States Donald Trump is trading insults with the co-hosts of an MSNBC talk show. Yet Mr. Trump appears to be making progress in what might have seemed the most difficult task given to him by voters in 2016: reducing the power of Washington’s permanent bureaucracy.

Secretary of State Rex Tillerson wasn’t exactly dying to move to Washington to run a federal department, but he seems to have warmed to the task. Max Bergmann, a former Obama Administration official now at the leftist Center for American Progress, writes in Politico that the “deconstruction of the State Department is well underway.” Discounting for the usual Beltway hyperbole, this probably isn’t as good as it sounds.

All kidding aside, the State Department is one federal agency that was actually contemplated by America’s founders. Conducting foreign policy is an important and necessary task for our central government. But like so much of the Beltway bureaucracy State has been overfunded and undermanaged for years. Now, despite what you may have read about untouchable bureaucrats unaccountable to the public they are supposed to serve, Mr. Tillerson has found ways to clean house, at least according to Mr. Bergmann:

    As I walked through the halls once stalked by diplomatic giants like Dean Acheson and James Baker, the deconstruction was literally visible. Furniture from now-closed offices crowded the hallways. Dropping in on one of my old offices, I expected to see a former colleague—a career senior foreign service officer—but was stunned to find out she had been abruptly forced into retirement and had departed the previous week. This office, once bustling, had just one person present, keeping on the lights.

The former Obama appointee is apparently so unnerved by the Trump-Tillerson era at State that he lets slip the fact that the career staff didn’t think much of the previous management either, and that the conservative critique of the department is at least partly true:

    When Rex Tillerson was announced as secretary of state, there was a general feeling of excitement and relief in the department. After eight years of high-profile, jet-setting secretaries, the building was genuinely looking forward to having someone experienced in corporate management. Like all large, sprawling organizations, the State Department’s structure is in perpetual need of an organizational rethink. That was what was hoped for, but that is not what is happening. Tillerson is not reorganizing, he’s downsizing.

Do taxpayers dare to dream? As odd as this sounds for regular observers of the federal leviathan, the new boss seems to be imposing the kind of tough measures often seen at struggling companies, but almost never witnessed at government departments that have lost their way:

    While the lack of senior political appointees has gotten a lot of attention, less attention has been paid to the hollowing out of the career workforce, who actually run the department day to day. Tillerson has canceled the incoming class of foreign service officers. This as if the Navy told all of its incoming Naval Academy officers they weren’t needed. Senior officers have been unceremoniously pushed out. Many saw the writing on the wall and just retired, and many others are now awaiting buyout offers. He has dismissed State’s equivalent of an officer reserve—retired FSOs, who are often called upon to fill State’s many short-term staffing gaps, have been sent home despite no one to replace them. Office managers are now told three people must depart before they can make one hire.

Perhaps the Tillerson method could work at other agencies too. Mr. Bergmann for his part seems to be disappointed that the un-elected career staff has not been able to impose its will on the duly-elected political leadership:

    At the root of the problem is the inherent distrust of the State Department and career officers. I can sympathize with this—I, too, was once a naive political appointee, like many of the Trump people. During the 2000s, when I was in my 20s, I couldn’t imagine anyone working for George W. Bush. I often interpreted every action from the Bush administration in the most nefarious way possible. Almost immediately after entering government, I realized how foolish I had been.

    For most of Foggy Bottom, the politics of Washington might as well have been the politics of Timbuktu—a distant concern, with little relevance to most people’s work.

Here’s to making the will of voters more than just a distant concern-- and highly relevant to the work of federal agencies.

Meanwhile over at the Environmental Protection Agency, new boss Scott Pruitt is not just draining the bureaucratic swamp in Washington, he’s taking away the agency’s power to oversee swamps nationwide. The Journal reported on Tuesday:

    President Donald Trump’s administration is moving ahead with plans to dismantle another piece of the Obama administration’s environmental legacy, the rule that sought to protect clean drinking water by expanding Washington’s power to regulate major rivers and lakes as well as smaller streams and wetlands.

And now the Journal reports:

    President Donald Trump declared a new age of “energy dominance” by the U.S. on Thursday as he outlined plans to roll back Obama era restrictions and regulations meant to protect the environment.

    In a speech at the Energy Department, the president promised to expand the country’s nuclear-energy sector and open up more federal lands and offshore sites to oil and natural-gas drilling.

    Mr. Trump also celebrated his decision earlier this month to withdraw the U.S. from the 195-country Paris climate accord and the Environmental Protection Agency’s rescindment this week of the Obama administration’s clean-water rules that farmers and business groups found onerous.

    “We don’t want to let other countries take away our sovereignty and tell us what to do and how to do it,” Mr. Trump said.

    Mr. Trump also issued a special permit authorizing the construction of a new pipeline between the U.S. and Mexico that would carry fuels across the border in Texas, the State Department said.

If Mr. Trump can finally reform the Washington bureaucracy and make the will of voters its primary concern, voters may decide he can tweet whatever he wants.
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DougMacG
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« Reply #1006 on: July 17, 2017, 10:04:40 AM »

Besides tax apathy, we can't seem to keep government spending on the front page here with all the excitement about shiny objects...

Please watch and share this video.   A simple plan for prosperity.

https://www.youtube.com/watch?v=JZOwaIzW0xY

http://www.powerlineblog.com/archives/2017/07/the-case-for-spending-caps.php



« Last Edit: July 17, 2017, 11:56:14 PM by Crafty_Dog » Logged
DougMacG
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« Reply #1007 on: August 03, 2017, 12:28:12 PM »

Newt Gingrich promised to reform the static and biased CBO, baseline budgeting and false tax and spending cut math.  A quarter century we still battle the same dinosaurs that act to stop reform of both health care and taxes.

I shouldn't need a link to prove that point.  Has CBO ever been right on ANYTHING?

https://www.cato.org/blog/how-revenue-neutrality-be-judged
https://www.cato.org/blog/cbo-projections-no-basis-claiming-tax-reform-loses-money

When you deny the positive, largely predictable effects of improving incentives in the economy, you are denying science.

The official policy of the US Government in 2017 is to deny science.  Reform the swamp - or drain it.
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DougMacG
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« Reply #1008 on: August 09, 2017, 10:05:44 AM »

Newt Gingrich promised to reform the static and biased CBO, baseline budgeting and false tax and spending cut math.  A quarter century we still battle the same dinosaurs that act to stop reform of both health care and taxes.

I shouldn't need a link to prove that point.  Has CBO ever been right on ANYTHING?

https://www.cato.org/blog/how-revenue-neutrality-be-judged
https://www.cato.org/blog/cbo-projections-no-basis-claiming-tax-reform-loses-money

When you deny the positive, largely predictable effects of improving incentives in the economy, you are denying science.

The official policy of the US Government in 2017 is to deny science.  Reform the swamp - or drain it.

Famous people caught reading the forum...

http://www.washingtonexaminer.com/sen-mike-lee-make-the-cbo-show-its-work/article/2630568

When Democrats passed Obamacare on a party-line vote in March 2010, the Congressional Budget Office estimated that by 2016, 21 million people would receive health insurance through the law's exchanges. In reality, just 10 million people did.

The CBO's model was off by more than 100 percent.

The same CBO estimate predicted that Medicaid would grow by 17 million enrollees to about 52 million. In reality, more than 34 million people have signed up for Medicaid since Obamacare became law, for a total of 74.5 million recipients today.

Again, the CBO's model was off by around 100 percent.

Now the CBO wants us to believe, based on the same models, that just repealing Obamacare's individual mandate, without a single dime's worth of cuts to Medicaid, would cause more than 7 million people to abandon their Medicaid coverage.

There are good reasons to be skeptical of the quality of healthcare that lower-income Americans receive through Medicaid, but why would 7 million voluntarily give up Medicaid coverage they receive for free? These CBO projections, and others like it, strain the boundaries of common sense.

When it comes to topics like the effectiveness of the individual mandate, there are sharp disagreements among experts. That's why, in the academic community, scholars have to "show their work" by publicly disclosing their data, estimates, and analysis to scholarly scrutiny, and most importantly, refinement and improvement.

Congress does need a scorekeeper to provide budgetary estimates for the policy changes it considers. But at a bare minimum, that scorekeeper should be forced to show how its models work. Currently the CBO doesn't have to do that. It's a "black box," a secret formula even Congress can't be allowed to see, yet which the House and Senate must treat as if they were handed down on stone tablets at Mt. Sinai.

It's an indefensible situation.

That is why I have introduced the CBO Show Your Work Act of 2017. This bill would require the CBO to publish its data, models, and all details of computation used in its cost analysis and scoring. CBO would keep its role as official scorekeeper of congressional budget proposals – but now the public and the economic community would be able to see what's going on in all those spreadsheets and algorithms.

That is, it would hold CBO to the same standard the American Economic Association's "Data Availability Policy" sets for all academic economists: requiring all paper authors to ensure their data "are readily available to any researcher for purposes of replication."

Consider again Obamacare's individual mandate. President Barack Obama opposed an individual mandate while campaigning in 2008, but saw the light later when the CBO started scoring Obamacare drafts.

A 2009 memo written by then-White House health adviser Nancy-Ann DeParle informed the president, "Based on our policy analysis, we believe that a weak requirement for all Americans to have insurance may come close to achieving the maximum coverage that can be achieved through aggressive outreach and auto-enrollment. Unfortunately, however, the Congressional Budget Office (CBO) will likely take the position that without an individual responsibility requirement, half of the uninsured will be left uncovered."


Following this memo, Obama chose to substitute the CBO's policy judgment for his own. The individual mandate became a pillar of the largest policy change in a generation.

Policymakers need data and data analysis to do their jobs. But to do their jobs well, they need the best analysis. And centuries of practical experience tell us that transparency and replicability are essential to the pursuit and acquisition of knowledge. There is simply no serious argument for insulating the most influential economic modelers in the United States from the academic standards that govern everyone from Nobel Prize-winning physicists to second graders "carrying the one" as they learn long addition.

We can do better as a Congress and a nation. We are never going to agree on what the best healthcare, tax, or energy policies should be. But when we make our arguments about the costs and benefits of our preferred policies, we should at least be willing to explain how and why our policies would work.
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Crafty_Dog
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« Reply #1009 on: August 29, 2017, 09:01:41 AM »

http://thehill.com/homenews/senate/348342-gop-risks-spending-confrontation-with-trump
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DougMacG
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« Reply #1010 on: September 12, 2017, 07:35:28 AM »

https://www.cbsnews.com/news/national-debt-hits-historic-20-trillion-mark/
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DougMacG
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« Reply #1011 on: September 12, 2017, 11:33:27 AM »

https://economics21.org/html/fix-federal-spending-baseline-first-2559.html

Fix the Federal Spending Baseline First
Charles Blahous
SEPTEMBER 10, 2017 BUDGET
Of late there has been controversy among budget wonks as to whether lawmakers should use a “current law” or “current policy” baseline to score the effects of tax reform in the budget process.  Though this is a prototypically arcane procedural fight, it bears enormous implications for federal finances.  The Committee for a Responsible Federal Budget (CRFB) has sounded an alarm against the possible use of a current tax policy baseline, calling it a “gimmick” that would add enormously to federal debt.  The competing argument is typified by a recent column from Manhattan’s own Brian Riedl, who finds that a current tax policy baseline is necessary for consistent treatment of taxes and spending.

I usually strive in my columns to provide a high ratio of factual information relative to interpretation and opinion.  However, it is difficult to enter this dispute without resort to significant interpretation and value judgments, so I want to be especially transparent here about my own subjective views.  In sum, I agree with CRFB that the use of current policy baselines is dangerously likely to lead to worse fiscal outcomes, for reasons I will detail later in this piece.  On the other hand, Riedl is correct to observe that using a current policy baseline for taxes would be a step toward more consistent, balanced treatment of taxes and spending.

First, the factual background.  As Riedl covers well in his piece, Congress’s scorekeeping rules (by which the Congressional Budget Office abides) exhibit significant inconsistencies.  Many areas of legislation, most especially tax law, are scored against a literal current law baseline, even if that current law would produce a sudden policy change.  So for example, if a particular existing tax provision is set to expire by a date certain, CBO assumes it will in fact do so, even if this would result in a sudden increase in tax assessments that most observers do not believe lawmakers will allow.  Accordingly, pending bills to extend current tax policies are typically scored as adding to the federal deficit. This reflects the (in my opinion, reasonable) view that CBO should score current law as it is, and not make speculative judgments as to the actions legislators will take to change the law.

This approach is not taken, however, with many areas of federal spending.  CBO assumes that discretionary appropriations will continue indefinitely even if under law they would expire at the end of the fiscal year.  And in perhaps the single most significant departure from current-law baselining, CBO is instructed to assume that Social Security and Medicare will make full benefit and insurance payments far beyond the amounts the programs are permitted by law to spend from their limited trust fund resources.  In other words, with respect to Social Security and Medicare, CBO is directed to assume that lawmakers will pass future legislation to effectuate large spending increases in those programs, far beyond what is authorized in current law.  Thus, there is no procedural barrier to increasing spending as long as it doesn’t exceed the spending increase assumed in the baseline, in which case lawmakers are not charged with adding to the deficit.

I first wrote about this phenomenon when explaining the finances of the Affordable Care Act (ACA): that it would improve federal finances only relative to Congress’s scoring baseline (with its assumption of future Medicare spending increases) while it was unambiguously a fiscal worsening relative to previous law.  At that time, my purpose was purely explanatory; I was agnostic as to whether the scorekeeping rules should change.  Since then I have come to believe that they should.  As Riedl explains, the rules are inconsistent and bias federal budget policy toward higher spending and higher taxes.  They create a host of other problems as well, about which I have written before but will not repeat here.   It was encouraging to see House Budget Committee then-Chairman Tom Price introduce legislation to address this problem before assuming the position of HHS Secretary.

Over the years various justifications have been offered for the scorekeeping baseline’s quirky treatment of Social Security and Medicare spending.  One suggestion is that this treatment is necessary to provide lawmakers with appropriate positive incentives.  Changing to literal current-law scoring for Social Security and Medicare would always show those programs being prevented from falling into the red, due to the curtailment of their spending authorities upon depletion of their trust funds. It is feared that incorporating this fail-safe assumption into the baseline would eliminate the credit lawmakers receive for legislating to align those programs’ benefit and tax schedules (because the baseline would already show them to remain in balance regardless).  I was once receptive to this belief, but the empirical evidence has shown it to be incorrect.

The currently-used spending baseline actually doesn’t create an effective incentive for lawmakers to address Social Security and Medicare financing gaps.  Instead of a stick (e.g., penalizing them for financing Social Security and Medicare shortfalls with debt) it offers a carrot (rewarding them for balancing program finances).   The relative incentive of the carrot is no stronger than the stick would be and in any case, does not justify treating entitlement spending differently from taxes.  The same rationale could be employed to argue that lawmakers should get a spendable scorekeeping credit simply for allowing current tax policies to expire, rather than being penalized for extending them.
Lawmakers respond much more to the negative incentive of being penalized for exacerbating deficits, than to the positive incentive of producing budget savings.  For example, Congress’s budget procedures erect barriers to adding to the federal deficit; they do not provide significant rewards for net improvements to the fiscal outlook.  The fiscal results are predictable, and were manifested most damagingly in the ACA.  Lawmakers didn’t seek credit for improving the fiscal outlook via the ACA’s Medicare cost-containment provisions – instead they concurrently spent those illusory savings on a massive new health entitlement.  This could not have happened if the budget rules had recognized lawmakers’ pre-existing statutory obligation to maintain balance in the Medicare HI trust fund, which would have accurately shown the ACA adding to federal deficits.

In fact, lawmakers are actually under great pressure to demonstrate that they are not balancing the budget on the backs of Social Security and Medicare.  Thus, they do not reap political benefits from the current scorekeeping practice of crediting them with large budgetary savings simply for upholding pre-existing Social Security and Medicare law.  Consequently, the advantaged treatment given to these programs in the budget rules is not an inducement for good fiscal behavior but rather an invitation to fiscal irresponsibility – an invitation that lawmakers have accepted in the past and almost certainly will again.

As CRFB correctly notes, the best fiscal behavior will occur if the budget baseline makes it harder, not easier, for lawmakers to add to the federal deficit. But to be both effective and fair, this principle needs to be applied with equal force on the spending side. It is fruitless to apply the principle only selectively – for example, by blocking the use of a current-policy baseline for taxes, while its equivalent on the spending side continues to permit the passage of large spending expansions such as the ACA.

With all this said, let’s examine the three scorekeeping alternatives on the table:
1)      Continue current-law scorekeeping for taxes, but make the rules consistent by applying it also to entitlement spending.
2)      Continue current-policy scorekeeping for entitlement spending, but make the rules consistent by applying it also to tax policy.
3)      Continue to use current-law scorekeeping for taxes and current-policy scorekeeping for entitlement spending.

#3, where we are now, is clearly bad.  It is inconsistent, incorrect and biases policy in the direction of higher spending and higher taxes, which is the essence of our budget problem. #1 is by contrast methodologically consistent and would produce the best fiscal outcomes.

Which of #2 or #3 is better/worse is a value judgment and a tough call.  #2 opens the door wider to higher deficits, while #3 opens the door wider to higher taxes.  Assuming spending policies are the same either way, this basically comes down to whether you are more concerned about higher taxes or higher debt.  This is largely a function of whether you believe today’s or tomorrow’s taxpayers should be stuck with increased tax burdens.  I have an opinion on that question but it’s just that -- an opinion, with which others could reasonably disagree.  A true deficit hawk would favor choice #1 – consistently applying current-law scorekeeping to both the mandatory spending and tax sides, while strengthening safeguards against additional deficit spending.

Hence, choosing between options #2 and #3 for the tax baseline bypasses the central scorekeeping question, while not offering either side an unassailably correct position.  Because of this, and given both legislative history and current projections, budget watchdogs should prioritize getting the spending baseline right first and foremost. 
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G M
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Posts: 15391


« Reply #1012 on: September 12, 2017, 07:09:02 PM »

Nothing will be done. Until it's far too late.


https://economics21.org/html/fix-federal-spending-baseline-first-2559.html

Fix the Federal Spending Baseline First
Charles Blahous
SEPTEMBER 10, 2017 BUDGET
Of late there has been controversy among budget wonks as to whether lawmakers should use a “current law” or “current policy” baseline to score the effects of tax reform in the budget process.  Though this is a prototypically arcane procedural fight, it bears enormous implications for federal finances.  The Committee for a Responsible Federal Budget (CRFB) has sounded an alarm against the possible use of a current tax policy baseline, calling it a “gimmick” that would add enormously to federal debt.  The competing argument is typified by a recent column from Manhattan’s own Brian Riedl, who finds that a current tax policy baseline is necessary for consistent treatment of taxes and spending.

I usually strive in my columns to provide a high ratio of factual information relative to interpretation and opinion.  However, it is difficult to enter this dispute without resort to significant interpretation and value judgments, so I want to be especially transparent here about my own subjective views.  In sum, I agree with CRFB that the use of current policy baselines is dangerously likely to lead to worse fiscal outcomes, for reasons I will detail later in this piece.  On the other hand, Riedl is correct to observe that using a current policy baseline for taxes would be a step toward more consistent, balanced treatment of taxes and spending.

First, the factual background.  As Riedl covers well in his piece, Congress’s scorekeeping rules (by which the Congressional Budget Office abides) exhibit significant inconsistencies.  Many areas of legislation, most especially tax law, are scored against a literal current law baseline, even if that current law would produce a sudden policy change.  So for example, if a particular existing tax provision is set to expire by a date certain, CBO assumes it will in fact do so, even if this would result in a sudden increase in tax assessments that most observers do not believe lawmakers will allow.  Accordingly, pending bills to extend current tax policies are typically scored as adding to the federal deficit. This reflects the (in my opinion, reasonable) view that CBO should score current law as it is, and not make speculative judgments as to the actions legislators will take to change the law.

This approach is not taken, however, with many areas of federal spending.  CBO assumes that discretionary appropriations will continue indefinitely even if under law they would expire at the end of the fiscal year.  And in perhaps the single most significant departure from current-law baselining, CBO is instructed to assume that Social Security and Medicare will make full benefit and insurance payments far beyond the amounts the programs are permitted by law to spend from their limited trust fund resources.  In other words, with respect to Social Security and Medicare, CBO is directed to assume that lawmakers will pass future legislation to effectuate large spending increases in those programs, far beyond what is authorized in current law.  Thus, there is no procedural barrier to increasing spending as long as it doesn’t exceed the spending increase assumed in the baseline, in which case lawmakers are not charged with adding to the deficit.

I first wrote about this phenomenon when explaining the finances of the Affordable Care Act (ACA): that it would improve federal finances only relative to Congress’s scoring baseline (with its assumption of future Medicare spending increases) while it was unambiguously a fiscal worsening relative to previous law.  At that time, my purpose was purely explanatory; I was agnostic as to whether the scorekeeping rules should change.  Since then I have come to believe that they should.  As Riedl explains, the rules are inconsistent and bias federal budget policy toward higher spending and higher taxes.  They create a host of other problems as well, about which I have written before but will not repeat here.   It was encouraging to see House Budget Committee then-Chairman Tom Price introduce legislation to address this problem before assuming the position of HHS Secretary.

Over the years various justifications have been offered for the scorekeeping baseline’s quirky treatment of Social Security and Medicare spending.  One suggestion is that this treatment is necessary to provide lawmakers with appropriate positive incentives.  Changing to literal current-law scoring for Social Security and Medicare would always show those programs being prevented from falling into the red, due to the curtailment of their spending authorities upon depletion of their trust funds. It is feared that incorporating this fail-safe assumption into the baseline would eliminate the credit lawmakers receive for legislating to align those programs’ benefit and tax schedules (because the baseline would already show them to remain in balance regardless).  I was once receptive to this belief, but the empirical evidence has shown it to be incorrect.

The currently-used spending baseline actually doesn’t create an effective incentive for lawmakers to address Social Security and Medicare financing gaps.  Instead of a stick (e.g., penalizing them for financing Social Security and Medicare shortfalls with debt) it offers a carrot (rewarding them for balancing program finances).   The relative incentive of the carrot is no stronger than the stick would be and in any case, does not justify treating entitlement spending differently from taxes.  The same rationale could be employed to argue that lawmakers should get a spendable scorekeeping credit simply for allowing current tax policies to expire, rather than being penalized for extending them.
Lawmakers respond much more to the negative incentive of being penalized for exacerbating deficits, than to the positive incentive of producing budget savings.  For example, Congress’s budget procedures erect barriers to adding to the federal deficit; they do not provide significant rewards for net improvements to the fiscal outlook.  The fiscal results are predictable, and were manifested most damagingly in the ACA.  Lawmakers didn’t seek credit for improving the fiscal outlook via the ACA’s Medicare cost-containment provisions – instead they concurrently spent those illusory savings on a massive new health entitlement.  This could not have happened if the budget rules had recognized lawmakers’ pre-existing statutory obligation to maintain balance in the Medicare HI trust fund, which would have accurately shown the ACA adding to federal deficits.

In fact, lawmakers are actually under great pressure to demonstrate that they are not balancing the budget on the backs of Social Security and Medicare.  Thus, they do not reap political benefits from the current scorekeeping practice of crediting them with large budgetary savings simply for upholding pre-existing Social Security and Medicare law.  Consequently, the advantaged treatment given to these programs in the budget rules is not an inducement for good fiscal behavior but rather an invitation to fiscal irresponsibility – an invitation that lawmakers have accepted in the past and almost certainly will again.

As CRFB correctly notes, the best fiscal behavior will occur if the budget baseline makes it harder, not easier, for lawmakers to add to the federal deficit. But to be both effective and fair, this principle needs to be applied with equal force on the spending side. It is fruitless to apply the principle only selectively – for example, by blocking the use of a current-policy baseline for taxes, while its equivalent on the spending side continues to permit the passage of large spending expansions such as the ACA.

With all this said, let’s examine the three scorekeeping alternatives on the table:
1)      Continue current-law scorekeeping for taxes, but make the rules consistent by applying it also to entitlement spending.
2)      Continue current-policy scorekeeping for entitlement spending, but make the rules consistent by applying it also to tax policy.
3)      Continue to use current-law scorekeeping for taxes and current-policy scorekeeping for entitlement spending.

#3, where we are now, is clearly bad.  It is inconsistent, incorrect and biases policy in the direction of higher spending and higher taxes, which is the essence of our budget problem. #1 is by contrast methodologically consistent and would produce the best fiscal outcomes.

Which of #2 or #3 is better/worse is a value judgment and a tough call.  #2 opens the door wider to higher deficits, while #3 opens the door wider to higher taxes.  Assuming spending policies are the same either way, this basically comes down to whether you are more concerned about higher taxes or higher debt.  This is largely a function of whether you believe today’s or tomorrow’s taxpayers should be stuck with increased tax burdens.  I have an opinion on that question but it’s just that -- an opinion, with which others could reasonably disagree.  A true deficit hawk would favor choice #1 – consistently applying current-law scorekeeping to both the mandatory spending and tax sides, while strengthening safeguards against additional deficit spending.

Hence, choosing between options #2 and #3 for the tax baseline bypasses the central scorekeeping question, while not offering either side an unassailably correct position.  Because of this, and given both legislative history and current projections, budget watchdogs should prioritize getting the spending baseline right first and foremost. 
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DougMacG
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« Reply #1013 on: September 19, 2017, 08:43:23 AM »

De-Fund the CBO and let them fund and publish their leftist drivel on their own dime.   - Doug
---------------------
Published July 18, 2017
[I try to follow economist Alan Reynolds and notice what I believe is his impact as a member of the IBD Editorial Board.]

http://www.investors.com/politics/editorials/will-22-million-lose-coverage-under-the-senate-health-bill-not-even-close/

This is about the PREVIOUS bill, but the CBO nonsense remains the same.

Senate Health Bill Falls Victim To The CBO's Incredibly Bad Uninsured Math
7/18/2017

Numbers Game: The Senate Republican effort to repeal ObamaCare has faltered, making it the latest victim of a seriously flawed report saying it would have cost 22 million people their health insurance.

The Congressional Budget Office, which has become the official scorekeeper of the impact of health reform despite its miserable track record, said that the Senate repeal-and-replace bill would leave 22 million more people uninsured by 2027 than if ObamaCare remained in place. Before that, it said the much different House repeal-and-replace bill would leave 23 million more without insurance. Heck, the CBO said that simply repealing ObamaCare without putting anything else in its place would result in 23 million more uninsured.

If that seems odd, take a close look at how the CBO got to these numbers and see that they are pretty much worthless.

Overestimating the individual mandate. The CBO said that getting rid of ObamaCare's individual mandate will immediately cause 7 million to drop out of the individual insurance market.

But the CBO wildly exaggerated the effectiveness of the individual mandate, which by all accounts is too small and easily avoidable to be effective. Last year, for example, 6.5 million paid the penalty, which averaged just $470. Nearly twice as many — 12.7 million — claimed one of numerous exemptions from the individual mandate, according to the IRS.

What's more, the vast bulk of those who enroll through the exchanges are getting heavily subsidized coverage — 84% get premium subsidies and 60% get additional help to cover out-of-pocket costs. It's these huge subsidies — not the penalties — that are the main attraction for those enrolled in the ObamaCare exchanges.

What about those not eligible for subsidies? Given the huge cost of insurance compared with the relatively puny penalty, it's unlikely that they're buying coverage just to comply with the mandate. The average premium for a family plan is $12,252 a year, with a deductible of more than $8,000. In contrast, a family of four making $100,000 would pay a penalty of just $2,085 for not buying insurance, according to the Healthcare.gov penalty calculator.

The fact that ObamaCare has failed to get enough young and healthy to buy coverage — the very people for whom the mandate was designed — is evidence enough that the penalty is largely ineffective.

So the CBO's claim that 7 million would immediately drop coverage once the mandate goes away was highly dubious.

Unlikely employer coverage impact: The CBO also said that 4 million people will lose coverage at work in 2018 if ObamaCare is repealed. But the CBO previously said that 6 million people would lose coverage at work in 2018 because of ObamaCare.

So shouldn't repealing ObamaCare add 6 million to employer plans? The CBO didn't explain how both keeping and repealing ObamaCare leads to millions getting pushed off employer plans.

 Faulty Medicaid forecast. The CBO also claimed that Medicaid enrollment will fall by 4 million in 2018. Not because of any changes to the program in the Senate bill — which does nothing to Medicaid for years — but again because of the individual mandate repeal.

The CBO figured that fewer people would sign up next year — for free insurance — absent the mandate. It's anyone guess whether the CBO was right about that, but it seems highly dubious.

So right off the bat, the 15 million the CBO claimed will lose coverage in 2018 was based on a lot of smoke and mirrors.

Counting phantom insured people. Worse, the CBO counted millions of people who don't have insurance now — and aren't likely get it in the next decade — as losing coverage under the Senate bill.

First, the CBO based its estimates on an old, and wildly inflated forecast of enrollment in the ObamaCare exchanges. To calculate the impact of the Senate bill, the CBO assumed that 18 million would sign up for coverage in the exchanges next year if ObamaCare remained in effect.

But the CBO knew this number was wrong, since its most current forecast has 2018 enrollment at just 11 million. In other words, the CBO counted millions of people as losing insurance under the Senate bill who never would have bought it in the first place.

The CBO also assumed that more states would expand Medicaid over the next decade if ObamaCare were left in place, and that 5 million people would gain coverage as a result. Since the Senate bill wouldn't let additional states expand Medicaid, the CBO counted those 5 million as losing coverage.

But states that already expanded Medicaid are now facing budget crunches as the cost of the expansion turns out to be far higher than anticipated. In fact, Ohio lawmakers just voted to freeze its Medicaid expansion. The idea that more states would expand Medicaid down the road is fanciful, at best.

So subtract another 5 million from the CBO's number.

In short, to get to the 22 million figure, the CBO vastly exaggerated the impact of the individual mandate, used wildly inflated ObamaCare enrollment numbers, and made highly unlikely assumptions about Medicaid.

Even for government work, that seems pretty shoddy, yet it still helped to derail ObamaCare's repeal.

It's a big win for the swamp, but a huge loss to anyone hurt as ObamaCare crumbles.
« Last Edit: September 19, 2017, 06:23:22 PM by Crafty_Dog » Logged
Crafty_Dog
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« Reply #1014 on: September 23, 2017, 11:25:47 AM »

http://www.nationalreview.com/article/451619/end-defense-budget-sequester-rebuild-american-military?utm_source=Sailthru&utm_medium=email&utm_campaign=NR%20Daily%20Monday%20through%20Friday%202017-09-22&utm_term=NR5PM%20Actives
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ccp
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« Reply #1015 on: November 29, 2017, 10:23:23 PM »

Claims he is cleaning house:   

https://www.spartareport.com/2017/11/secretary-tillerson-is-to-democrat-state-department-careers-like-fire-is-to-wood/
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Crafty_Dog
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« Reply #1016 on: November 29, 2017, 11:26:13 PM »

 cool cool cool
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