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Thread: How do you see our long term budget outlook?

  1. #21
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    Kandahar's Avatar
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    10-15-13 @ 07:47 PM

    Re: How do you see our long term budget outlook?

    Quote Originally Posted by cpwill View Post
    yes, that is because the CBO was ordered to double-count no less than $500 Billion,
    The CBO merely notes that the Affordable Care Act will produce savings in both Medicare spending and the federal budget (via the Hospital Insurance Trust Fund); just because the same policies produce savings in both areas doesn't mean they are double-counted.

    assume that unemployment would be at about 7.5% by now,
    From the long-term perspective of its impact on the federal budget, the current rate of unemployment is a trivial factor in its overall impact on the debt.

    pretend that Congress would actually slash reimbursement rates to providers by 30%,
    This was a problem BEFORE the Affordable Care Act became law, and would continue to be a problem with or without the Affordable Care Act. The CBO is decidedly NOT assuming that Congress would slash reimbursement rates by 30%; in fact, the ACA essentially codifies the "Doc Fixes" that Congress had previously been passing every year, thus ruling out those savings. The question is whether or not that should be included in the cost of the ACA. The Congressional Budget Office didn't score it as such, since Congress had been passing the fixes every year anyway.

    and assume 4.5% growth in order to spike revenues.
    Where does this number come from? The most recent CBO estimate that I've seen places an upper limit of 3.3% growth on any year until 2017.

    So when Republicans took over Congress, they asked the CBO to score Obamacare without the gimmicks.
    They sure did. And the CBO still told them that repealing it would add $230 billion to the deficit.

    the "it reduces the budget" line was the chief whopper of that sale, right next to "if you like your health insurance you can keep it"
    It's a budget-buster. Even the Medicare / Medicaid Actuaries say that it bends the cost-curve up.
    Don't get me wrong; the CBO isn't infallible...but they aren't reliable optimists either. So while they could be wrong (and probably WILL be), I'd say it's about equally likely that they're wrong in either direction. So the ACA could result in huge savings or a modest deficit. And even the latter situation wouldn't be that bad, as it would still reduce private expenditures and extend coverage.

    Especially once you score it's first 10 years of operation.
    Since the CBO's estimate indicates that savings will be greater in the SECOND decade than the first, the argument that revenues kick in before expenses due to accounting gimmickry doesn't seem to stand up to the financial analysis.
    Last edited by Kandahar; 07-19-11 at 08:50 PM.
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