Donald Marron has written a carefully argued post teasing out the different elements of in the 2010 health reform:

To say “the health care reform law reduces the deficit over the next ten years according to CBO” is absolutely true. But it often gets elided to “health care reform reduces the deficit over the next ten years” which isn’t true if, like Greg, you think the revenue raisers, student loan changes, and CLASS Act aren’t really health care reform.
I think Greg is right to worry about this distinction. Because of the information loss as the details of CBO scores get transmitted through various layers of speakers and media (including this blog), some people are indeed under the mistaken impression that health care reform, by itself, reduces the budget deficit over the next ten years. It doesn’t.
However, Greg’s analogy has a flaw: it presumes that none of the tax increases count as health reform. I disagree.

Marron is scrupulously fair-minded, and I recommend his reflections on the “Cadillac” tax. Let me just say that I really don’t think the Cadillac tax was the most effective version of tax reform as health reform, or even close. Jonathan Bernstein wrote a post that referred to a related observation of mine:

I don’t want to stretch what Salam said too far, but let’s just say it pointed me to a way through the confusion that I’ve had, and that I think others have had, about conservative budget thinking, and makes sense of Mankiw—and of GOP opposition to PAYGO, support for unfunded tax cuts, and the rest of the Republican fiscal stew.
To understand what they’re saying, just throw out the entire concept of a budget.
So: to characterize conservative talk about revenues and spending, I think what I’d say is that conservatives believe that each program, and every tax, should be judged on its own merits. If a spending program is necessary, like missile defense, then it should be fully funded. If not, it should not be funded. On revenues, the justification for any sort of taxation is that citizens should have “skin in the game,” and therefore everyone should pay the same, small amount. Any more taxes, and any more spending, are by this way of thinking fiscally irresponsible.

The first part of this last paragraph sounds reasonable enough. On taxes, I just want a system that raises the most revenue at the lowest level of excess burden, consonant with a desire to protect low to moderate earners from an onerous tax burden. This is consonant with a flattish income tax, but that has nothing to do with the justification for taxation. That is an entirely separate question over which I imagine there’s plenty of disagreement on the right. I’m content to assume that we should pay for justified government expenditures. In my perfect world, we’d pass a big, comprehensive overhaul of the tax code that would eliminate deductions, lower rates, and increase revenues. Then we’d tackle infrastructure in a bill that might have a tax component, e.g., it might reform the gas tax by replacing it with a VMT and use VMT revenue for mass transit as well as highways, etc., but it would steer clear of protecting wildlife and other issues that are best understood as separate. I wouldn’t fall on my sword on this idea — it’s hardly a matter of principle. It just makes intuitive sense to me, partly so we can get a clearer picture of what’s at stake.

Now, you may note at this point that there’s nothing in that formula to make government revenues equal government spending. As far as I can tell, that’s correct; conservatives aren’t interested in that question.

This is so foreign to how I think about these issues that I don’t know where to begin. It is possible that some conservative somewhere thinks about these issues in this way. I certainly don’t.

Moving along, Peter Suderman has a great interview with Douglas Holtz-Eakin (or, as some like to call him, the Notorious D.H.E.). He makes a simple and important point about CBO scoring:

The first and foremost thing to recognize is that “scoring” is just that. It’s not forecasting. It’s scoring. And the analogy I always use is, in football a touchdown is six, kicking an extra field goal is one, and running it over is two. Why? I have no idea. But by having that set of rules for scoring, you can compare games across time, across teams, and across all sorts of situations, because you have a common thread of scores. So the most important thing about scoring is to apply the same rules to every bill. Every time a new iteration of the health care bill it was either more or less expensive. And we knew something like the relevant ordering of it. So that’s its top priority.
That means that when CBO has to make a call, it should make that call in a similar fashion every time while you’re debating legislation. Sometimes you have to make calls that you don’t have much information about. In that sense they’re are arbitrary. But I don’t think that that’s a bad thing, as long as it’s done in a nice statistic fashion.
There’s a second goal: to be not only consistent across legislation, but to be accurate in its forecast. CBO certainly tries to do that. But it operates in an environment where there’s a ton of uncertainty. The most important pieces of legislation are the hardest, because they’re new and by definition harder to evaluate.

There’s been an active effort to characterize DHE’s criticisms of how the CBO score has been used in our political conversation as somehow attacking the ref. The idea is silly. He isn’t attacking the ref. Rather, he is drawing attention to how some politicians and activists are misunderstanding at best and misrepresenting at worst what the CBO scoring process actually means.