Budget Office Works Powerfully Behind The Scenes

The Senate Finance Committee has crafted a health care bill that won't add to the federal deficit, even though it's expected to cost a trillion dollars over the next 10 years. The senators went back to the drawing board after an even higher price tag was predicted by the Congressional Budget Office. The CBO is playing a powerful role in shaping the health care debate.

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Here in Washington, the Congressional Budget Office recently gave its estimate for a proposed bill overhauling health care, forecasting that it would add at least a trillion dollars to the federal deficit, possibly even more over the next decade. Following that, senators on the Finance Committee went back to work reviewing the plan.

The CBO plays a powerful role in shaping the debate on health care and a lot of other issues. NPR's Scott Horsley reports on the CBO's influence, which often is greater than many elected leaders.

SCOTT HORSLEY: The Congressional Budget Office does much of its work behind the scenes. Director Doug Elmendorf rarely grants TV interviews. But the CBO became a highly visible target last week when its 13-figure forecast for the cost of health care reform caused sticker shock on Capitol Hill.

Representative NANCY PELOSI (Democrat, California; Speaker of the House): It has always been a source of, yes, I'll say frustration for many of us in the Congress that the CBO will always give you the worst case scenario.

HORSLEY: House Speaker Nancy Pelosi's complaint had a familiar ring for Robert Reischauer. He ran the CBO in the 1990s when President Clinton's health care plan was on the table. Reischauer says CBO's 235 staffers often have the tough job of telling lawmakers their wish list is unaffordable.

Mr. ROBERT REISCHAUER (Former Director, Congressional Budget Officer): More often than not, they're the goat.

HORSLEY: Or perhaps some other animal. Reischauer was once given a toy skunk as a symbol of CBO's regular role in the legislative picnic.

Mr. REISCHAUER: Everybody's having a good time until the skunk comes trotting across the field and often can ruin the day.

HORSLEY: Reischauer admits that CBO forecasts are not as black and white as their aromatic mascot. They itemize costs to the government, but typically don't try to quantify savings elsewhere. And even though the CBO tries to think 10 years into the future, longer than many lawmakers preoccupied with the next election, Reischauer says it may not be farsighted enough to provide a full accounting.

Mr. REISCHAUER: When we come to something like fundamental health reform, the real consequences will not be seen for 15, 20, 25 years.

HORSLEY: Forecasting health care cost is one of the toughest jobs at CBO. It's hard to extrapolate from past experience since the government is trying to change behavior.

Douglas Holtz-Eakin, who ran CBO from 2003 to 2005, says the best one can do is use consistent assumptions and be clear about them. In the end, he says, it's up to Congress to decide how much weight to give any forecast.

Mr. DOUGLAS HOLTZ-EAKIN (Former Director, Congressional Budget Office): There is always a place for the Congress to say this policy's a good idea and we believe its merits outweigh whatever the estimated costs might be. That's their job.

HORSLEY: Holtz-Eakin adds that a certain amount of griping about projections comes with the territory at CBO. Even when lawmakers complain about the forecast, he says they serve a useful function.

Mr. HOLTZ-EAKIN: When lawmakers are frustrated and can't find a way to go forward, they can just blame CBO. And it's a convenient place to focus their anger. And then they can go back to making the legislation work.

HORSLEY: That's what's happening in the Finance Committee, where senators have been whittling away at their proposal to bring the CBO price tag under a trillion dollars.

Reischauer says the CBO's credibility depends on the quality of its research and its reputation for avoiding either Republican or Democratic bias.

Mr. REISCHAUER: One can find proof of that simply in the fact that people on both sides of the aisle are always screaming at CBO and unhappy with particular estimates that it produces.

HORSLEY: Republicans got their turn to complain a few days ago when CBO released a report forecasting much lower costs for climate change legislation than the GOP had been warning about. That bill is set for a vote on the House floor today.

Scott Horsley, NPR News, Washington.

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