It's time to fix the CBO rules

Since the CBO is forced to analyze only the components of a new law that they are told to analyze and to assume whatever rosy assumptions that are built in the bill, the Republicans now have to argue that the CBO scoring of Obamacare is faulty and leaves out some of the real costs, such as the the doc fix, and counts some of the revenue twice. They're right, of course, but it is a difficult debate for many people to follow. Even Douglas Elmendorf, the present head of the CBO notes these problems. Kevin Williamson explains what is really going on.

First, it is worth asking how complete and how accurate the CBO’s estimates are. You know who has some useful insights into that question? The CBO. For instance, CBO director Douglas Elmendorf readily concedes that “estimates of the effects of comprehensive reforms are clearly very uncertain, and the actual outcomes will surely differ from our estimates in one direction or another.” One direction or another. (Guess!) It will not come as a shock to observers of federal activities ranging from the ethanol program to the Iraq war that — unthinkable as it may seem — a government program may under some circumstances exceed its budget. If Obamacare spends not a nickel more than the CBO estimates, and if Obamacare produces every dime of the revenue promised, then it will prove a deficit-reduction tool over the next decade, by definition: That’s $411 billion in spending and $525 billion in revenue. I wonder if Ezra Klein would like to place a very large bet with his own money on the possibility of that happening. I would. In fact, I am willing to bet not only that there will be significant variation, I am willing to bet on the direction of that variation, at least insofar as the spending goes. (I would not be surprised if revenue projections fell short, too: Those tax increases are going to be even less popular when people start paying them.)

You know who seems sympathetic to my position? Douglas Elmendorf of the CBO, who writes: “CBO’s cost estimate noted that the legislation maintains and puts into effect a number of policies that might be difficult to sustain over a long period of time. For example, the legislation reduces the growth rate of Medicare spending (per beneficiary, adjusting for overall inflation) from about 4 percent per year for the past two decades to about 2 percent per year for the next two decades. It is unclear whether such a reduction can be achieved, and, if so, whether it would be through greater efficiencies in the delivery of health care or through reductions in access to care or the quality of care. The legislation also indexes exchange subsidies at a lower rate after 2018, and it establishes a tax on insurance plans with relatively high premiums in 2018 and (beginning in 2020) indexes the tax thresholds to general inflation.”

Take a look at the 1965 cost and revenue projections for Medicare and compare them to the reality of Medicare today. In 1965, Medicare was going to be totally solvent on a 1 percent payroll tax. How’d that work out? (links in the original)

Read the rest for an explanation of how bogus those CBO projections are. What the Republicans should do first is submit their own request to the CBO to score Obamacare realistically. Then they should get started amending how the CBO works so that it isn't bound by the ol' Garbage in, Garbage out rules under which it now operates.

The silliest debate on the Constitution

The Republicans started out their control of the House of Representatives yesterday by having the Constitution read aloud. Many liberals scoffed at this as mere symbolism. Just so.

The Democratic House members apparently figured that there was no up side to appearing to be anti-Constitution and so they joined in the reading. But not before a few Democrats objected that the GOP were reading a "redacted" Constitution and leaving out the portions of the Constitution that have been overridden by subsequent amendments. Here is Dana Milbank putting for that view.

In fact, there is only one version of the Constitution - and it wasn't what the lawmakers read aloud. What the Republican majority decided to read was a sanitized Constitution - an excerpted version of the founding document conjuring a fanciful land that never counted a black person as Three-Fifths of a white person, never denied women the right to vote, never allowed slavery and never banned liquor.

The idea of reading the Constitution aloud was generated by the Tea Party as a way to re-affirm lawmakers' fealty to the framers, but in practice it did the opposite. In deciding to omit objectionable passages that were later altered by amendment, the new majority jettisoned "originalist" and "constructionist" beliefs and created - dare it be said? - a "living Constitution" pruned of the founders' missteps. Nobody's proud of the Three-Fifths compromise, but how can we learn from our founding if we aren't honest about it?

The selective constitutional reading was the latest indication that, for all the talk of honoring the Constitution, Tea Party-infused lawmakers are more interested in editing it. Some have talked of repealing the 14th Amendment, which gives birthright citizenship and guarantees equal protection. The new majority leader has endorsed a constitutional amendment that would allow a group of states to nullify federal laws.

On Thursday, Republicans said the selective reading of the Constitution was approved by the Congressional Research Service, but it often seemed willy-nilly. Readers skipped right over the three-fifths compromise and the bit about escaped slaves. They neglected to cut a passage guaranteeing the vote to "male inhabitants" who are at least 21, but they lopped off the entire Prohibition amendment.

This is silly taken to the extreme. The Constitution has been amended and certain parts of the Constitution are no longer operative. There is no point in reading the Three-fifths Clause because that was modified by the Fourteenth Amendment. If you look at any printed version of the Constitution or a version online, something is done to indicate that the words of the Three-Fifths Clause are no longer operative. They might be in italics or with cross-throughs with an explanatory note as to how those sections have been made obsolete by subsequent amendments. For example, we no longer elect the president in the way originally planned by the Constitution because of the Twelfth Amendment.

If we followed the objections by these sanctimonious of originalists like Dana Milbank and the Democrats complaining in the House, we would have a constitution that was internally inconsistent. They'd read about one way to choose senators that is no longer in existence because of the Seventeenth Amendment. The Three-fifths Clause is no longer part of today's Constitution. Since the point of reading the Constitution was for the members to pay fealty to the principle that we are a nation governed by laws, by a fixed Constitution. That Constitution can be amended and when it is, the amendments are a part of the Constitution and owed as much deference as the body of the document. And, as such, when an amendment modified a part of the original Constitution, that change is part of the new Constitution - the one that judges must interpret. No judge today bases a decision based on a part of the Constitution that is now obsolete. So why would the House today in 2011 be including those deleted portions?

And individual members might have ideas about further amendments that they'd like to see ratified. But the point is that they're making their ideas for change within the framework given in the Constitution about how to amend the Constitution. They're not just storming ahead willy-nilly and asserting that they can do whatever they want without any regard for how the Founders planned for such changes in the Constitution in a method that was deliberately designed to be difficult and lengthy because the Founders were suspicious of changes inspired by the passions of the people without careful consideration.

The only reason to make those demands to read the Three-Fifths Clause is to rub people's faces in the faults of the original Constitution and remind people that are Founding has an original sin - the sin of slavery. Yes, it did. That was a tragedy and no one is denying that. But it is no longer true. There is no debate about whether those portions of the Constitution that were made obsolete by the Thirteenth and Fourteenth Amendments are still in effect. But the fact that these Democrats would be making that demand makes it clear what their real attitude towards the Constitution is. They regard it as a faulty document that deserves no deference today by this generation's legislators.

Cruising the Web

Remember that there are many people out there who remember what it was like to be frugal in spending and saving.

Oh, joy. Just what we want - more political posturing with every Democrat now taking lessons on how to emulate Chuck Schumer's media mastery.

Charlie Crist is joining a law firm that prides itself on being the "personal injury lawyers for the people." Does this surprise anyone?

How stupid is it for two Republicans to miss the swearing-in ceremony because they were fundraising in the Capitol Center?

Nancy Pelosi's future will be different from her past

Dana Milbank ponders the demotion of Speaker Pelosi and posits that she is better in the opposition.

But there was a genuine reason for Pelosi to smile as she surrendered the gavel: She was returning to a job that suits her better.

As speaker, her record was mixed. She had many major legislative achievements, particularly in the past two years, but she also led her caucus off an electoral cliff, in part because she forced members to take damaging votes on policies that didn't have a chance of passing the Senate.

In her four years as minority leader, by contrast, Pelosi's effectiveness was seldom questioned as she tripped up the majority with her relentless opposition. "If people are ripping your face off," she said before winning the majority in 2006, "you have to rip their face off."

Pelosi is better in the fight than she is in charge, a more able warrior than lawmaker.

I disagree with Milbank's analysis and prognostication about Pelosi's future. First of all Pelosi was very effective as Speaker. She kept her caucus together and pushed through the measures that she wanted. Her problem was that the public didn't want what she was selling. But she was masterful in orchestrating her party to pass her bills.

It is a lot easier to shine in opposition when a politician doesn't have her own record. Being the leader of the opposition to an out-of-power party criticizing an unpopular president leading up to the 2006 election victories for the Democrats is a very different job facing Pelosi today. Now she has four years of a record in power and a president of her own party in power. She won't be criticizing without having to defend her own actions as she did prior to becoming Speaker. She won't be able to make promises about transparency and spending control as she did before because such claims are just laughable given her actual actions when she wielded the gavel.

Before he ascension to Speaker, few people, other than political mavens, knew who she was. Sure readers of this blog knew who she was but the average American doesn't know who the leader of the minority power of the House is. But now she is a familiar face. She has also had to suffer the criticism and ridicule that Republicans aimed at her for the past four years. Many Republicans ran for the House by tying their opponents to Nancy Pelosi. She has been the butt of jokes on late night comedy shows including some devastating skits on SNL. She is not anonymous.

So when she appears on talk shows or gives interviews criticizing the Republicans in the House, even a compliant media will know to ask her questions contrasting her own job as Speaker with her criticisms of John Boehner. If she makes promises of what she would do if put back in power in 2012, she'll have to answer questions about her previous actions.

She might have considered yesterday's transfer of power as the first rally in her 2012 campaign, but she'll have to face the reality that she is no blank slate making promises that exist in a vacuum.

Cruising the Web

If you need a smile today, watch this video of a two-year old reciting what she knows about presidential history.

David Brooks notes that the Democrats have been an epic failure at persuading the American people that a large, intrusive government can act nimbly to solve the nation's problems.

Unintended consequences rise up again. Megan McArdle points to new regulations for credit cards that would make it harder for stay-at-home wives or spouses earning substantially less than their spouses to get credit cards.

This is scary - a hacker was able to access federal and state computers by using malwear disguised as a Christmas greeting from the President.

Lucianne links to this story about the fraud perpetrated by the author of an influential story tying vaccines to autism. The result has been that thousands of parents have refused to have their children innoculated thus exposing them to mumps, measles, and rubella. Such deception is criminal.

Byron York contrasts the speech that John Boehner made in 2006 to introduce Pelosi as the new Speaker and the speech that Pelosi made yesterday to introduce Boehner as the new Speaker. Quite a contrast in style: humble graciousness with self-praising puffery.

Daniel Henninger pushes to bring back the president's power to impound funds and not spend as much as the Congress wants.

People don't seem to like the description "progressive" any more than they like being called a "liberal."'

Harry Reid says that the American people "love government." It's just the politics we don't like. Uh, no. Democrats love government. The rest of us are a lot more skeptical. That explains why Steny Hoyer thinks that the complaints coming from the tea partiers are motivated by their having unhappy families. And Howard Dean thinks that the tea partiers are just aging folks who don't like seeing a new generation composed of people of "different races, different religions, and different sexual orientations" dating each other. Of course, Dean ignores the real statistics about the tea party movement that show a similar racial make up to the rest of the U.S. population.

Fixing the filibuster

John Podhoretz has some fun treasuring the hypocritical switch in positions on using the "nuclear option" to change the rules on invoking cloture on debate in the Senate. Back when the Republicans were talking about changing the rules for voting on judicial nominations to end the possibility of filibusters, Harry Reid was all sanctimonious about such an "arrogant abuse of power" and Mitch McConnell was all for it. Now that the Democrats are in the majority, suddenly such a nuclear deal to force a change in the rules seems a lot less arrogant and the Republicans are all of a sudden much more worried about the sacred rights of the minority party.

These shifts happen when parties switch power. But there are some Democrats who don't care. They're just ticked at how the Republicans have barred the bills that they want to pass so they want to take advantage of the window opened by starting a new Congress to vote in a change in the rules. However, there are some Democrats who disagree and don't want to pull that nuclear lever. They're worried that they might be in the minority perhaps after the 2012 elections when twice as many Democratic senators are up for reelection and many of those senators are in red states.

Here is another reason to doubt that the Democrats will vote through such a change in rules. It wouldn't do them any good. The GOP controls the House so the Democrats aren't going to be able to pass the bills they want even with a lower limit on ending a filibuster. They'd be incurring all the bad publicity and it wouldn't help them enact the sort of laws that they want to. But they would certainly be setting up the GOP if they should gain control over both houses in the next election.

Look for some sort of compromise along the lines of Senator Alexander's proposal to fix some other problems in the Senate.

In a speech at the conservative Heritage Foundation, Alexander said the move would hinder legislators from amending legislation.

"Let's be clear what we mean when we say the word 'filibuster,' " Alexander said. "So the real 'party of no' is the majority party that has been saying 'no' to debate, and 'no' to voting on amendments that minority members believe improve legislation and express the voices of the people they represent."

Instead, Alexander suggested improving the Senate by requiring all senators to vote, end the "three-day work week" and end the practice of secret holds.

Secret holds are an abomination and ending them would be to the benefit of both parties. There's a good start on reform that makes sense no matter which party controls the Senate.

Cruising the Web

Hmm. Some interesting tidbits on Saddam's nuclear program from Wikileaks. I wonder why the media isn't highlighting this information?

Here's a defense of Captain Owen P. HOnors who just got kicked out of his job commanding the USS Enterprise.

Let me add my voice to the call to replace Christiane Amanpour with Jake Tapper.

Governors are other states are planning to run advertising campaigns in California to entice businesses to leave the high-tax state and come to their states. I bet it will be a persuasive message for many businesses.

Apparently, the newest front on the PC battlefront is history textbook editors seeking to excise the word "slave" from chapters on the ante-bellum South and the Civil War and replace it with "enslaved person."

Michael Barone points to an interesting factoid - the GOP members of the House and Senate are now younger by average age than the average Democrats. The differences between the two parties on age are wider than they have ever been. The Democratic Party prides itself on its appeal to the young, but they're representing that generation with older politicians who have a completely different frame of reference.

Nancy Pelosi claims that she would have still passed Obamacare even if everyone in the country was happy with his or her health insurance. Apparently, she actually believes the fantasies the Democrats put forth about how the bill would save money despite all the tricks that they had to use to get a favorable evaluation from the CBO. Just for starters - remember how they wrote a bill asking the CBO to count ten years of tax hikes and six years of benefits? I'm sure that that is the way all Americans figure up their family budgets.

Can rules matter?

The Republicans in the House are planning to implement some new rules on spending and budgeting. Their aim is to fix the loopholes through which the Democrats drove through their spending increases. The Democrats came in after the 2006 election claiming to be doing the same thing and we saw what happened with that and how they broke their own rules.

These are some of the changes the GOP are implementing.

In their new rules, Republicans are giving paygo the heave-ho and substituting a rule called "cut as you go." From now on, increases in mandatory spending—for new or existing entitlements—will require that spending be cut by an equal or greater amount elsewhere in the budget.

Another new rule will make it harder to hide deficit spending by gaming the so-called budget window. The cost of spending bills are scored over periods of one, five and 10 years, and Democrats have routinely disguised the true cost of such bills by pushing the spending into the "out years" beyond a decade. Famously, they also counted 10 years of revenue but only six years of spending to make ObamaCare appear to cut the deficit.

The new House rules require budget projections for four additional 10-year windows. And if mandatory spending increases the deficit by more than $5 billion in any of those 10-year windows, the bill will be subject to a House point of order, forcing Members to vote in favor of increasing deficits.

The GOP also plans to create "spending reduction accounts" to reduce overall spending levels if Congress votes, say, to kill an earmark. Currently, if Congress kills a $300 million Bridge to Nowhere, that money merely goes somewhere else. The new rule says that a successful amendment to strike money from a spending bill will transfer that money to an account that will reduce total amounts appropriated.

Perhaps most encouraging is that the GOP is taking on one of its own sacred spending cows—road building. In 1998, then GOP Transportation Chairman Bud Shuster made it a violation of House rules to reduce spending below the levels that his committee had authorized. This meant that Congress had no choice but to meet this "minimum guarantee" no matter how much revenue was coming in to finance roads under the gas tax.

Under the new rule, Transportation spending will be treated like all other programs. It's an especially good sign that Republicans are sticking with this rule despite howls from the highway and construction lobbies, which rightly thought they owned the GOP during the Newt Gingrich and Tom DeLay eras.

Democrats seem especially angry about another new GOP rule that gives Budget Chairman Paul Ryan the power to unilaterally impose budget limits for the current fiscal year. The Democratic Congress abdicated that authority when it failed to pass a budget resolution last year, giving Appropriators no spending targets to hit.

The GOP rule will let Mr. Ryan set those targets, and the Wisconsin Representative has said he wants to return nonsecurity discretionary spending to 2008 levels. Mr. Ryan's authority will expire when Congress passes its next budget resolution, and in the meantime Democrats should lament their own failure, not the GOP's willingness to impose more spending discipline from the get-go.

It all sounds promising, but we've been burned before on fine-sounding rule changes that ended up meaning little. We'll have to give these rules a chance to see if they'll make a difference. And the WSJ is correct that it is also time to rewrite the rules that govern the entire budgeting process. And that would involve the Senate. Don't expect any change there.

Cruising the Web

Guy Benson has the story of how the Russian Duma, just as opponents of the START treaty warned, are insisting that the preamble language limiting US missile defense capability is central to the treaty. It's not a good sign when the country we're signing a treaty with are so open about how they think it means something different from what our president is telling us it means.

Roger Pilon of the Cato Institute briefly reviews how we went from being a country with a limited government to the boundless powers that are now claimed for the government. No wonder the Democrats are laughing at the quaint idea that legislators should indicate the constitutional authority for any new law.

Bill McGurn outlines the battles that now exist between private and public union workers. Those who work in the private sector are a bit tired of having to pay for generous benefits going to those in the public sector.

Even Illinois is getting the message on education reform. They're about to vote on tying teacher tenure to student achievement on tests. They're also going to limit the power of teachers to strike. Amen. There is something that seems criminal about teachers going on strike and holding the children hostage for their wage demands. If Illinois Democrats have gotten the message, there is indeed hope.

Thomas Sowell is particularly scathing in talking about how there are those of the underclass who are being treated as the mascots of the elites.

Why is the Department of Health and Human Services paying money to steer the results of Google searches?

These are very sad and dramatic photographs of "Detroit in ruins." Check out the photo display to see what the end of a once-prosperous city looks like.

Obama's own political maneuvering coming back to bite

As the Republicans take over the House today, one of the looming debates is over raising the debt limit. There are Republicans who want to get some major concessions on spending before they vote to raise the limit. However, the White House economic adviser, Austan Goolsbee, is out there warning against any playing politics with the vote.

"The impact on the economy would be catastrophic," Goolsbee told "This Week" on ABC. "That would be a worse financial economic crisis than anything we saw in 2008."

Goolsbee added: "I don't see why anybody's talking about playing chicken with the debt ceiling."

It's a vote that politicians will have to swallow hard and take. They might, like Lindsey Graham advocates, be able to trade some real reforms of entitlements and a return to pre-recession spending levels, but the debt ceiling will get raised.

But let us return a few years to when Barack Obama was a young senator and the Republicans controlled the Congress and White House. Back then he had a different approach to the vote on raising the debt ceiling.

That’s a sharp contrast from the position of Obama in 2006, while serving as an Illinois senator. Obama joined all Senate Democrats to oppose the 2006 debt limit increase.

“Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren,” Obama said in 2006. “America has a debt problem and a failure of leadership.”

Obama later missed two votes in 2007 and 2008 while campaigning for president. Many Democrats who opposed the 2006 increase flipped their position once they took control of the Senate.

Yup, the irony is coming back to bite. Any Republican who wants to posture and vote against raising the debt ceiling will have an automatic defense from accusations of playing chicken. "Hey, we're just doing what Obama himself did when he was in the Senate."

Exposing the NYC Sanitation Workers

Hot Air has this video from the local CBS news reporting on Sanitation workers not plowing streets.

The question is - what will and can be done to individual bosses? Does any one have confidence that Mayor Bloomberg is willing to mix it up with a union and hold tough? Perhaps a political appointee might lose his job and maybe those individuals caught on tape, but don't expect any strong action.

Government raids on private pensions

European countries facing massive deficits are starting to look towards people's pension funds for the money they need. Here are some examples of how those countries are taking people's retirement funds to pay for their general purpose government spending.

The most striking example is Hungary, where last month the government made the citizens an offer they could not refuse. They could either remit their individual retirement savings to the state, or lose the right to the basic state pension (but still have an obligation to pay contributions for it). In this extortionate way, the government wants to gain control over $14bn of individual retirement savings....

The fourth example is Ireland. In 2001, the National Pension Reserve Fund was brought into existence for the purpose of supporting pensions of the Irish people in the years 2025-2050. The scheme was also supposed to provide for the pensions of some public sector employees (mainly university staff). However, in March 2009, the Irish government earmarked €4bn from this fund for rescuing banks. In November 2010, the remaining savings of €2.5bn was seized to support the bailout of the rest of the country.

The final example is France. In November, the French parliament decided to earmark €33bn from the national reserve pension fund FRR to reduce the short-term pension scheme deficit. In this way, the retirement savings intended for the years 2020-2040 will be used earlier, that is in the years 2011-2024, and the government will spend the saved up resources on other purposes.

Of course, this is just stealing from Pierre to pay Paul. The bill will come due soon down the road. What hope is there that there will be funds sitting around to pay back those "liberated" funds?

And we've been doing the same thing all along here in the United States. There is no Social Security trust fund - today's contributions go to pay for today's retirees with the excess going to pay for present-day spending. All the Social Security fund has is a bunch of IOU statements. And where is the money to pay back going to come from?

At least when we control our own retirement funds, we can be the ones to decide if we want to raid our savings to pay for present needs. When the government runs the show, we have no control at all.

Cruising the Web

Kyle Smith has a lot of fun debunking that silly, yet supposedly scientific study that liberals have been touting to demonstrate that liberals are more courageous than conservatives. Why don't we just agree to halt all this political phrenology trying to demonstrate some sort of correlation between political ideology and other characteristics?

More bad PR for the NYC Sanitation Department. Several witnesses say they saw a group of Sanitation supervisors buying six-packs of beer and sitting in their car drinking with the engine idling all night and then called in that they couldn't do anything about the blizzard because they'd run out of gas.

Michelle Malkin recommends a solution to such problems with the NYC Sanitation workers - privatize trash collection and snow clearance. The city could save money and have better service.

Everyone is pointing fingers to explain why, despite having close to a super majority in Congress and a Democratic president from Hawaii, the execrable Akaka bill didn't get passed. The rest of us can just be happy that it sank of its own weight.

It will be interesting to see what an influx of Iraqi War veterans into the House of Representatives will do for policy.

Oh, those inconvenient facts - for all the President's claims about having to spend "every waking hour" on the economic crisis and so he was prevented from traveling more outside of the D.C. bubble, it turns out that he has spent more than half his days in office traveling.

As of January 2, Obama has been president for 712 days. According to figures compiled by CBS News reporter Mark Knoller, who serves as a sort of unofficial White House record-keeper, Obama has spent 339 of those days -- nearly 48 percent -- outside Washington.

And for a guy worried that he hasn't spoken enough and connected enough to the American people, he has made 883 speeches in those 712 days.

Hey, dude, where's my district? Dennis Kucinich is worried that, with Ohio losing two congressional districts and the redistricting process in the control of Republicans, he'll lose his districts. He's asking for suggestions of where he should run next. Vermont perhaps?