The Congressional Budget Office this afternoon released more details on the budgetary effects of repealing the healthcare law. In his director's blog, CBO Director Douglas Elmendorf said the office believes repealing the law would reduce revenues by $770 billion through 2021 and reduce spending by $540 billion in that same time period.
The result is the same $230 billion deficit that CBO estimated Thursday. But identifying the $540 billion in reduced spending might make it easier for Republicans to argue that repealing the law is an attempt to cut government spending and reduce the tax burden. Republicans have generally argued that the healthcare law means more spending and higher taxes to pay for that spending.
Elmendorf's full blog posting from today is below:
Additional Information on CBO’s Preliminary Analysis of H.R. 2
CBO and the staff of the Joint Committee on Taxation (JCT) have not yet developed a detailed estimate of the budgetary impact of H.R. 2, the Repealing the Job-Killing Health Care Law Act, which would repeal the major health care legislation enacted in March 2010. Yesterday, we released a preliminary analysis of that legislation indicating that, over the 2012-2021 period, the effect of enacting H.R. 2 on the federal budget as a result of changes in direct spending and revenues is likely to be an increase in deficits in the vicinity of $230 billion, plus or minus the effects of forthcoming technical and economic changes to CBO’s and JCT’s projections for that period.
We have been asked to provide the revenue and direct spending components of that total. Extrapolating the estimated budgetary effects of the original health care legislation and accounting for the effects of subsequent legislation, CBO anticipates that enacting H.R. 2 would probably yield, for the 2012-2021 period, a reduction in revenues in the neighborhood of $770 billion and a reduction in outlays in the vicinity of $540 billion, plus or minus the effects of forthcoming technical and economic changes to CBO’s and JCT’s projections.