Are Democrats Playing Budget ‘Shell Game’ With Biden’s $1.75 Trillion Spending Plan?
Despite moderate Joe Manchin’s claim to contrary, White House and Democratic leaders in House insist legislation put forward is fully paid for
WASHINGTON — While lawmakers celebrated House passage of a $1 trillion highway and infrastructure bill late Friday, they remained divided over a larger domestic spending bill and precisely how much it would cost. Republicans staged a press conference on the grounds of the Capitol Friday morning, calling on Democratic House Speaker Nancy Pelosi to postpone a planned vote on the president’s Build Back Better package of climate and social services spending until the budget score, which is prepared by the Congressional Budget Office, is released. Moderate Democratic members of the House also groused about the lack of a budget score. Meanwhile, in the Senate, which will have to sign off on the Build Back Better legislation if it is to become law, West Virginia Democrat Joe Manchin accused Pelosi and her leadership team of playing a “shell game” to disguise the bill’s effects on the federal budget. Manchin contended on Monday that “the real cost” of the $1.75 trillion bill would be nearly twice that amount if key elements of the package were extended or made permanent. Without knowing how this would “impact our debt and our economy and our country,” Manchin said he wouldn’t support it. Both the White House and Democratic leaders in the House insist that the legislation they have put forward is fully paid for. By that, they mean that all new spending in the bill is offset, either by new revenue sources or decreased spending in other areas. A common problem in political battles in Washington is that the two sides frequently talk past each other, using words and phrases that one party interprets as meaning something completely different than the other. When it comes to how proposed legislation is expected to affect the federal budget, however, there is a neutral arbiter whose decisions both parties, sometimes grudgingly, respect. The Congressional Budget Office, or CBO, is an agency created in the 1970s to provide lawmakers with nonpartisan analysis of the expected economic effects of proposed legislation. When lawmakers ask the CBO to provide that analysis of a specific bill, the product the agency delivers is known as the legislation’s budget score. “The CBO is the neutral gatekeeper,” said William Gale, a senior fellow in the Economic Studies Program at the Brookings Institution and a former senior economist for the Council of Economic Advisers under President George H.W. Bush. “Especially in the politically charged environment we have, we need some organization to be able to put out numbers that the two sides can agree are legitimate,” he said. “If the numbers that two sides are using are completely different, then you can't even really have a discussion about it. CBO, through many hard-won battles and careful work, has earned and I think deserves that role.” The CBO has the reputation of being something of a thorn in the side of the White House. The agency’s director is a presidential appointee, but the tradition of independence within the agency is typically adopted by the director, which frequently leads to intraparty strife. Douglas Holtz-Eakin, who ran CBO for nearly three years during the first term of President George W. Bush, came under frequent fire from his own party after the agency under his leadership continued to present relentlessly honest assessments of the true effects of proposed tax cuts and ideas like a partial privatization of the Social Security system. CBO directors usually “cause the most trouble for their own parties,” Holtz-Eakin told VOA. “When I was appointed CBO director, the Republicans, of course, said good things about nonpartisanship ... but they really wanted me to give them a break every now and then. And if you don't, they get mad. So, every director, his own party is mad at him,” he said. None of this is to say that Congress is operating completely in the dark in the absence of CBO scores. The bill that is currently before the House has been reviewed by both the Joint Committee on Taxation (JCT), another arm of Congress, and the White House’s Office of Management and Budget (OMB). Both JCT and OMB have reported that, by and large, the Democrats’ claim that the spending in the bill is offset is accurate. However, because the elements of the bill keep changing, it is difficult to say for certain whether the latest version lives up to lawmakers’ claims. The bill that was originally supposed to cost $3.5 trillion has been trimmed to $1.75 trillion at last count. But critics say that lower number doesn’t really reflect a 50% drop in spending. Some longtime observers of congressional budget fights believe that objections from fiscal hawks like Manchin arise from the early termination of many programs that the Democrats plainly mean to make permanent. In that case, the "shell game" Manchin is referring to involves strategies like reducing the overall cost of the bill by making a popular new refundable child tax credit expire after only one year, even though everyone involved knows that congressional Democrats plan to reintroduce the tax credit after it expires. Moves like that have allowed Democrats to claim to Manchin that the latest version of the bill cuts spending in half. “But that’s not an apples to apples comparison,” said G. William Hoagland, a senior vice president at the Bipartisan Policy Center, and a former Republican staff director of the Senate Budget Committee. “So the question then becomes, ‘Well, wait a minute, if it was really 10 years, what would it really cost?’ ” said Hoaglund. As written, Hoagland said, he has little doubt that the bill has most of its spending offset, as Democrats claim. But that doesn’t provide the full picture — and that’s where the CBO might come in. “All I can say is that I think that's why you need an independent group of people who have no party affiliation, to be able to look at this and analyze it as separate and apart from everything else that's going on,” Hoagland said.