On Tuesday, the new House approved what might appear to be an insignificant rule change that shows the depths to which they’ll sink to make it look like they’re the party of good ideas. Their plan? Changing how the Congressional Budget Office (CBO) calculates the impact of various pieces of legislation. The method is called “dynamic scoring,” and forces and ideological bent on the (currently) non-partisan CBO.
But hey, things like math and logic don’t actually matter to Republicans. Anything they can do to manipulate reports so it’s easier to cater to the likes of the Koch brothers is good. According to The New York Times, what dynamic scoring will show regarding taxes is “that [tax cuts’] impact on economic growth would substantially reduce their cost to the Treasury.”
In other words, they’ll be able to force the CBO to take the failed-beyond-all-doubt trickle-down theory of economics into account when they refuse to remove preference (read: loopholes) from the tax code, and drastically cut taxes for the wealthy and for corporations. Their hope is likely that the CBO will return a glowing report on their policies, which will make them easier to push through.
The Times reports that dynamic scoring works like this: The CBO would be required to consider possible effects on employment, economic growth, investment income and other macroeconomic variables when calculating the impact of major pieces of legislation. In this case, “major” means any piece of legislation that will cost at least $42 billion.
According to New York Magazine, what the CBO currently does is calculate changes in behavior that a piece of legislation might bring. For instance, higher cigarette taxes will lead to fewer people smoking cigarettes, which could depress the tobacco market in time. They have never taken into account all the macroeconomic variable listed above for every piece of major legislation.
While this might seem to be a better approach, The Times quoted Edward D. Kleinbard, chief of staff of the Joint Committee on Taxation, as saying:
“The basic problem remains that macroeconomic work is useful in the laboratory but not in the field. The models are too simplistic and the range of the possible outcomes so great that it opens the process to too much in the way of political intuitions.”
So it makes the CBO vulnerable to ideological influences. Since Republicans and Democrats, and the respective experts and think tanks they listen to, can never agree on how best to keep the economy going, create jobs, and so forth, dynamic scoring is a monumentally bad idea. With a Republican majority in the House, they will tell the CBO to consider economic growth from continued, or even expanded, tax cuts for corporations and the wealthy.
This is especially alarming considering that The Times reports a possibility that House Republicans will work on major tax reform this year, too.
One of the deals that kept us from falling over the edge of the fiscal cliff at the end of 2012 was letting the Bush-era tax cuts on the wealthy expire. NY Magazine says that the Heritage Foundation and Congressional Republicans insisted that job growth would tank, the economy would tank, and unemployment would skyrocket. NY Magazine made the perfect statement about that:
“Almost nothing that has happened in the two years since has made that conservative argument look good.”
That’s true: The CBO projected that unemployment would fall to 7.6% at the end of 2014; it’s below 6%. The economy itself is entering a phase of growth that the GOP, and their “experts” insisted wouldn’t happen. In fact, they swore up one side and down the other that the opposite would be happening right about now.
Nobel-prize winning economist Paul Krugman calls this “voodoo economics.” He notes that conservatives time and again predict economic collapse whenever taxes go up. They did it after Clinton hiked taxes, and they did it again after the fiscal cliff deal went into effect. The people who buy into the trickle-down theory are almost a cult these days. Krugman says, “They know what they know and are impervious to contrary evidence.”
Or it could be the frightening reach of influence of wealthy jagoffs like the Koch brothers. So, instead of actually looking at the overwhelming evidence against trickle-down economics and trying something else, Congressional Republicans will force the CBO to use dynamic scoring, based on their failed ideologies. In other words, they’ll manipulate the entire system instead of trying to shift ideology towards what actually works.
Featured image by The White House. Licensed under Public Domain via Wikimedia Commons