Key budget office caught in crosshairs over Biden spending plan
Pressure is mounting on the chief agency tasked with scoring the budgetary impact of legislation as the Congressional Budget Office (CBO) crunches the numbers for a sweeping $1.75 trillion social spending and climate package that Democrats are working quickly to pass.
The CBO score on a cornerstone of President Biden’s economic agenda will be a pivotal moment for lawmakers in the House and Senate.
If the score is above $1.75 trillion, it could give Sen. Joe Manchin (D-W.Va.) and other centrists a reason to oppose the measure and to push for additional cuts. Progressives have already seen their prized $3.5 trillion measure whittled in half.
A vote next week in the House is also connected to the CBO’s work. Moderate House Democrats have said they want more “fiscal information” from the CBO about the bill.
It’s all put a spotlight on the wonky work of an office Congress relies on for math on the potential economic effects of government policy.
With lawmakers on recess this week, the CBO has begun releasing cost estimates of certain sections of the bill as Speaker Nancy Pelosi (D-Calif.) tries to set up a vote next week. Those estimates only account for a fraction of the overall “score” the CBO is expected to produce on the bill in the coming weeks.
“I guarantee CBO is just working flat out,” Keith Hall, who served as the director of the CBO from April 2015 to May 2019, said in an interview with The Hill.
He said the agency’s work capacity is likely at its “peak load” as they sift through the more than 2,100 pages of legislative text that comprise Biden’s Build Back Better Act.
Usually, Hall said, lawmakers will work with the CBO for months while crafting legislation, which often involves members running draft language by the office for rough estimates of the budgetary impact.
“Ultimately that does two things. One, it reduces surprises,” Hall said. “So they already know generally what CBO is going to say when they make a formal request. And second, it lets them do a lot of work ahead of time because these things can take weeks or even months.”
Additional changes to the text, Hall said, can add to that time.
Over the past few months, Democrats have made significant changes to Biden’s spending plan.
As the bill’s size was cut back, there were significant changes to proposals for a national paid and family leave program, healthcare policy and tax hikes targeting the wealthy and corporations.
“They’re in the middle of negotiations. They’re thinking of things and if they keep throwing in changes, what seems to them sometimes to be a pretty modest change, CBO has to rerun their models and rerun everything,” Hall said. “And that, that can take a while.”
Democrats are passing the bill using a process known as budget reconciliation, which will allow them to approve the measure in the evenly split Senate with a simple majority and prevent a GOP filibuster.
No Republicans will back the bill, which means Democrats can afford just three defections from their side in the House and none in the Senate.
Republicans have launched a pressure campaign targeting the billions in proposed spending while calling for a full CBO score, a process that could take weeks, for the package before it is brought to the floor.
In a statement on Tuesday, CBO Director Phillip Swagel made clear the “analysis of the bill’s many provisions is complicated” and that it will only release “estimates for individual titles of the bill as we complete them.”
“Other estimates will take longer, particularly for provisions in some titles that interact with those in other titles. When we determine a release date for the cost estimate for the entire bill, we will provide advance notice,” he said.
Pressed on some of the programs that could be difficult to score, Zach Moller, a former Senate Democratic budget aide, pointed to policy dealing with health care, which a significant portion of the party’s spending plan is expected to cover via proposed changes to drug pricing, the Affordable Care Act (ACA) and Medicaid.
“Health care is always complicated to model and estimate because the health care sector is very large and has both government and private sector components,” he said. “How people choose to utilize health care, how people help people get their health insurance coverage, there’s a lot of moving parts with health care.”
Hall, who led the CBO when Republicans unsuccessfully attempted to repeal and replace the ACA through budget reconciliation in 2017, recalled some of the frustrations his office fielded from lawmakers as it scored the legislation.
“They were very frustrated because they would make a change, and we would have to rerun the health insurance model, which is modeling health insurance in 50 different states,” he said.
“The model literally would have to run all night, it would take overnight to run, and then it would take literally a week or two to process the information,” he said.
An aide familiar with the CBO’s current scoring on the Democratic-led bill told The Hill on Thursday that they anticipate further estimates on the bill to be completed later this week.
Five House moderates — Reps. Ed Case (D-Hawaii), Josh Gottheimer (D-N.J.), Stephanie Murphy (D-Fla.), Kathleen Rice (D-N.Y.) and Kurt Schrader (D-Ore.) — issued a statement on Nov. 5 saying they plan to vote on the bill next week if the information released by the CBO “is consistent” with White House data provided to members on the top lines for revenues and investments for the legislation.
A couple other House Democratic centrists did not sign that statement, and their votes are in doubt on the package.
Moller, who serves as director of the economic program at the centrist think tank Third Way, said he thinks lawmakers should already have enough information between the White House and recent estimates released by the Joint Committee on Taxation to move forward in the House.
“Because the bill contains so many different pieces, it’s really difficult for the House to functionally wait for a full CBO score,” he said.
The score is a necessity in the Senate, which can’t pass the bill under the budget reconciliation rules without it.
Moller said the Senate parliamentarian will also need to weigh in on whether certain provisions violate the Byrd rule, which limits what lawmakers can pass using reconciliation.
“The House does not have a Byrd rule. It’s really for the Senate that the CBO score is going to be necessary,” he noted.
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