Today’s CBO score ignoring Democrats’ budget gimmicks shows how massive the deficit impact of Build Back Better really would be.
Democrats have used every trick in the book to make their Build Back Better Act appear less costly than it really would be. The Congressional Budget Office’s estimate using its ordinary budget-scoring rules (and including Democrats’ tax-enforcement provisions) projected it would add $160 billion to the deficit over the next ten years.
The CBO’s estimate today without gimmicks: $3 trillion.
The CBO provides official scores to Congress for legislation based on agreed-upon budget-scoring rules. Those rules allow politicians to game the system to make legislation appear less costly than it will really be. Both parties know these rules and use them to their advantage, and the CBO applies them fairly to both parties.
The CBO exists to serve Congress, and the CBO also provides cost estimates upon members’ requests. They do this for both parties as well. Politicians often use these reports to prove political points. Bernie Sanders has requested reports on prescription drug prices and tax avoidance by the wealthy in the past.
Republicans requested a cost estimate of Build Back Better from the CBO that ignored one of Democrats’ most-used budget gimmicks: arbitrary deadlines. The version of Build Back Better that passed the House says the child tax credit will expire after 2022, the child-care and preschool provisions will expire after 2027, health-insurance subsidies will expire after 2025 and 2026, the earned-income tax credit will expire after 2022, etc. These deadlines were selected to make the bill appear less costly over the ten-year budget window.
But of course, Democrats do not actually want any of those provisions to expire. Democrats have pitched Build Back Better as a transformative economic agenda. Transformative economic agendas don’t expire. When these programs hit their deadlines, Democrats will do everything in their power to extend them.
That’s why Lindsey Graham and Jason Smith requested an estimate from the CBO with all the programs made permanent. That’s how Democrats actually intend to implement Build Back Better in the long run, and there should be a CBO score that reflects that intent. That’s how the deficit impact balloons from $160 billion to $3 trillion over ten years.
The $3 trillion includes the effects of tax enforcement and interest on the debt as well. It’s a much better all-inclusive summary of the true cost of Build Back Better. And it demonstrates that Democrats packed $2.84 trillion worth of budget gimmicks into the version of Build Back Better that passed the House.
In September, Joe Manchin called for a “strategic pause” on Build Back Better in the Wall Street Journal. As one of the reasons for his pause, he wrote, “We must allow for a complete reporting and analysis of the implications a multitrillion-dollar bill will have for this generation and the next.” Today’s CBO score is part of that analysis, and it shows that one of the implications for the next generation is $3 trillion more in debt.
He also said in the same op-ed, “A pause is warranted because it will provide more clarity on the trajectory of the pandemic, and it will allow us to determine whether inflation is transitory or not.” Since he wrote that, Fed chairman Jerome Powell has stopped using the word “transitory” to describe inflation, and three consumer price index reports have come out, each showing higher annual inflation than the previous one.
Manchin has also said elsewhere, “As more of the real details outlined in the basic framework are released, what I see are shell games — budget gimmicks that make the real cost of the so-called $1.75 trillion bill estimated to be almost twice that amount if the full time is run out. If you extended it permanently.” Today’s CBO score shows that the only way Build Back Better doesn’t add trillions to the national debt is if you take Democrats’ budget gimmicks and shell games at face value.
President Biden lied about the cost of Build Back Better immediately after the first CBO score came out, so don’t expect him to change his tune on the bill’s deficit impact. But between today’s inflation report and today’s CBO score, Joe Manchin should feel more confident than ever about telling his Democratic colleagues “no” on their progressive agenda.