Battle lines drawn over how to measure budget deficits

Which party has a plan to reduce the deficit? It depends on whom you ask.

Just two days into their new job as House leaders, Republicans convened a Rules Committee meeting in order to approve a rule that would repeal the healthcare reform law. Republicans say that, according to estimates from the Republican-led House Budget Committee, repeal would save $701 billion over 10 years and prevent $2.6 trillion in expenditures by the time the bill is fully implemented.

Rules Committee Chairman David Dreier (R-Calif.) entered these estimates into the record of the hearing Thursday. In doing so, he dismissed a Congressional Budget Office analysis released today that said repealing the healthcare bill would increase the deficit by $230 billion through 2021.

Dreier and other Republicans say CBO's analysis is short-sighted because it ignores the reality of last year's bill, which funds six years of healthcare benefits beginning in 2014 with 10 years of revenue that the government is already starting to collect. That, they say, means deficits in the second decade of the healthcare bill, when 10 years of revenue will need to fund 10 full years of healthcare benefits.

Nonetheless, the traditional use of CBO numbers have Democrats saying Republicans are choosing to ignore what many see as a neutral arbiter of the costs of legislation. Several of the dozens of House Democrats who lined up to testify before the Rules Committee cited the CBO report in arguing that Republicans have already abandoned their pledge to reduce the deficit.

Senate Democrats took it a step further today, releasing their own report that said the Republicans' legislative goals would increase the deficit by about $1.1 trillion. In addition to healthcare repeal, Democrats cite Republican support for a permanent estate tax cut that would increase the deficit by $308 billion, permanent extension of the Bush tax cuts for the "very wealthy" that would increase the deficit by $565 billion and another $50 billion in business tax breaks.

Senate Democrats also point to Wednesday's House rule that allows the House to ignore the budgetary effects of the healthcare repeal and these other tax changes.

Since might makes right, the House Republican point of view will prevail in the House, but these deep, emerging fights in the first two days of the 112th Congress indicate Senate Democrats will not look kindly on any legislation the House sends to the Senate.