Congress’s nonpartisan budget arm wants you to understand how it comes up with its projections.
Congress’s nonpartisan budget arm wants you to understand how it crunches the numbers.
This year, in a bid for greater transparency, it published unprecedented details of its economic methods at a time when many Republicans are questioning the reliability of the 43-year-old Congressional Budget Office.
“Transparency is a top priority for CBO,” wrote Director Keith Hall Thursday in a report that outlined recent efforts to explain economic modeling while analyzing the accuracy of CBO’s past projections.
He wrote just three days after CBO published a forecast that might please—at least temporarily—the Trump administration and Republicans touting the recently enacted tax cut. It said real gross domestic product in 2018 is projected to grow by 3.1 percent, or about 0.6 percentage points faster than the pace of growth in 2017.
But CBO tempered that by predicting a moderation of that growth in the final six months of 2018. “And in 2019, the pace of GDP growth slows to 2.4 percent in the agency’s forecast as growth in business investment and government purchases slows,” the report cautioned. That came a day after CBO’s monthly budget review put the federal budget deficit at $682 billion for the first 10 months of fiscal 2018, “$116 billion more than the shortfall recorded during the same period last year.”
Rep. H. Morgan Griffith, R-Va., who has joined with several Republican colleagues in criticizing CBO, told Government Executive through a spokesman that he had no comment on the new economic growth estimate, “but still thinks that CBO’s overall modeling system is flawed, especially in regard to scoring bills.”
For much of the current Congress, Republicans have blasted CBO for its estimates on such legislation as the farm bill and Republican efforts to repeal the Affordable Care Act. Critics include former Rep. Mick Mulvaney of South Carolina, now President Trump’s budget director, who said in a May 2017 interview with the Washington Examiner that “At some point, you've got to ask yourself, has the day of the CBO come and gone?”
House Freedom Caucus members Mark Meadows, R-N.C., and Jim Jordan, R-Ohio, a year ago wrote in an op-ed that “Congress too often makes the mistake of blindly following projections of the Congressional Budget Office that later proved to be grossly inaccurate. The CBO's reputation among the public and the media may be strong, but its track record in providing accurate estimates to Congress leaves much to be desired.”
Beginning last January, the House and Senate Budget Committees have held a series of hearings on oversight and possible reforms of CBO, at which director Keith Hall has testified repeatedly.
“CBO routinely works hard to make its analysis transparent, but of late, the agency has shifted existing resources toward making it still more so,” he told the House Budget Committee in January, adding that CBO “will increase public documentation of its modeling efforts by publishing more slide decks, working papers, appendixes, supplemental data, related spreadsheets, and other technical material.”
House Budget Chairman Steve Womack, R-Ark., after a March hearing featuring past CBO directors, said, “Since its inception more than 40 years ago, CBO has not undergone a comprehensive review. This series of hearings finally fulfilled this committee’s duty for proper oversight and broadened our understanding of CBO’s work and challenges.”
In an interview this week with Government Executive, director Hall (a former Bureau of Labor Statistics commissioner and George Mason University senior fellow picked by Republicans in 2015), denied that the transparency push was a direct response to lawmaker complaints.
“Congress members can criticize us if they have specifics, and we talk to them. But we’re really trying to be responsive to Congress as a whole, working for all of Congress, especially the budget committees,” he said. The series of hearings brought out concerns about transparency, but “they have a lot of different ideas on transparency, and we made a lot of promises, but it’s not that straightforward.”
Hence the blog posts and presentations. “We do excellent work and have a good reputation for quality—accuracy is really important to us,” Hall said. “But we have to do work very quickly. We’ve never been given a piece of finished legislation saying, ‘let us know when you’re done.’ It’s always a draft piece, always in a hurry.”
Achieving greater transparency “is a big strain on resources,” he added. “We’re trying to make good business decisions to balance our resource in ways Congress finds most useful.”
Releasing CBO’s economic models—long a battle cry by skeptics in the conservative policy community—is done in numerous ways, Hall said. “If we produce a cost estimate, we now make more of an effort to explain the estimate, where we got it, explain our process and make the results more accessible for Capitol Hill staff and outside experts.”
Examples include release of the code for “one of our most important models, the long-term potential output model for 10-year economic forecasts,” he said. “It’s a pretty big step, unprecedented.”
On Aug. 8, CBO released an in interactive workbook that demonstrates how its analysts project estimates of spending on discretionary programs over multiple years. It also recently released, just as it published a report about Medicaid managed care, a set of files with historical data about enrollment in and spending for Medicaid managed care for each state and eligibility group.
And this Wednesday, CBO released an interactive tool for analyzing the military’s force structure, which policymakers can use to mix and match troop or weapons strength to assess the effects of differing policies on budget outcomes.
In the politically fraught area of health care, CBO has been readying a specific plan for publicly presenting a revised model for long-term spending forecasting, enlisting feedback from the Bipartisan Policy Center. It might be ready in March, Hall said—for both public and expert consumption.