Saturday, January 3, 2015

The Political Motivation For Republicans To Force Dynamic Scoring On CBO

Paul Ryan is the budget magician in the GOP controlled House.  His budget proposals incorporate dynamic scoring which the non-partisan Congressional Budget Office has refused to use in the past.  The House rejected the appointment of the Obama Administration's nominee who understands the flaws in dynamic scoring.  Now that they control the Congress they intend to put a director in place who will bless Paul Ryan's budgets by using his assumptions about dynamic scoring.  This article explains how dynamic scoring works and why Paul Ryan wants to force the CBO to use dynamic scoring when it looks at the implications of federal tax cuts.

Ryan's budget proposals assume that his tax cuts will be paid for by cuts in government spending. They also assume that reductions in government investment have no impact on economic growth.  Only private sector investments promote economic growth in Ryan's budget proposals.  Since that assumption is false,  Ryan's budget proposals will produce the result that he favors.  Budget deficits will increase and they will be used to justify further cuts in government spending on the social welfare programs that Republicans strongly oppose. Ryan's efforts to transform the non-partisan CBO in a partisan arm of the Republican Party is very clever and very sinister.  The CBO has long understood the problems with dynamic scoring.  The electorate does not understand it.  Conservative think tanks are doing what they can to make it acceptable to the public.  They are connecting it to Ronald Reagan's tax cuts which, they argue, led to the  economic growth that followed.  They do not mention the huge budget deficits that followed the tax cuts during the Reagan era.  They forced his successor to raise taxes in order to cut the deficits and to break his promise that he would not raise taxes if elected.  George H. Bush was not reelected and many believe that his decision to reduce budget deficits by raising taxes contributed to that result.  He was supposed to cut government spending to reduce the budget deficit in accordance with GOP ideology.

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