Posted on 01/06/2015 3:25:46 PM PST by NormsRevenge
WASHINGTON (Reuters) - The U.S. House of Representatives voted on Tuesday to incorporate macroeconomic projections into cost estimates for major legislation, a move that critics say could hide the true budgetary effects of tax cuts.
The move toward "dynamic scoring" is part of a package of new rules that passed on a 234-172 party-line vote as the new Republican-controlled Congress started its work.
(Excerpt) Read more at news.yahoo.com ...
Zero-based budgeting?
Lying bastards continue Grubering America.
....and so the Boenher-Bhama regime starts....
These are actually GOOD changes!
Under the old rules, if Congress wrote a law raising the tax on something 10%, the budgetary group HAD TO automatically assume that there would be AT LEAST a 10% increase in funds.
They were NOT ALLOWED to consider that some people would STOP buying the products or at least slow their purchases.
These are GOOD changes!
Normally, I would agree.
But Congressional attitudes being what they are now, I fear that "dynamic scoring" will be used as a way to inflate income and, thus, increase spending.
Hopefully there are more good things for conservatives in the new rules.
A major, though secondary, goal of the revolt against Boehner was to secure beneficial rule changes.
The text of the new rules are not available yet on the clerk's site.
Dems complain = good.
Wife complains = bad.
;)
exactly. dynamic scoring, iirc, tries to take into account the EFFECTS of the action.
For instance, put a 15% tax increase on all cars, in the old system, you would assume that car buying would remain the same.
under dynamic scoring, the estimator now has to adjust for FEWER CARS being bought because of the tax increase.
I know that is a simple example, but I think that is how it works.
Good change.
Hopefully they will keep coming.
Remember the CBO 'scoring' Obamacare, based upon fudged numbers and deliberately-deceptive accounting gimmicks and flawed data assumptions promulgated by the libs?
The X-Files got it wrong: The Truth Is NOT Out There.
Now it's time to clean house [NPI] and start firing most of the CBO, which has never been anything but a liberal propaganda machine, claiming to be "non-partisan."
Until the personnel there change, there's no reason to think more rational economic models are going to really be used.
So long as the Democrats controlled the CBO, EVERY, REPEAT, EVERY “score” has been wrong.
Static scoring + Democrat lies = grossly misleading economic projections. Their INTENTIONAL errors have caused severe harm to the US economy over the years.
Did I mention that the CBO HAS BEEN WRONG about everything?
I am most pleased that dynamic scoring will be the rule in future CBO projections.
Hopefully, the Republicans will play the game straight.
We’ll see, and if they don’t, we should fall on them FRom a great height!
Dynamic scoring has the opposite effect. It makes spending worse, and it makes tax cuts better.
"Dynamic scoring" will make tax cuts better...by reducing the revenue lost, thereby increasing the money available to spend.
Certainly, it is a mmore accurate representation of the real world. But I won't be surprised if Congress abuses it...
Still don’t have the text of the rules.
Anyway, since Republicans opposing the rules were
Griffith
Jones
Massie
Yoho
Mulvaney (voted present)
It obviously did not amend them to allow more participation by conservatives in bills.
Which was the “brass ring” of the revolt.
DS Incorporates feedback effects into the scoring equations.
It is a much superior and accurate model of tax revenue projections.
It’s been around at least since 2005 and before and was actually voted by Congress and made law to use. But the accountants in the JCT ignored it while saying they deidn’t have the software for it which was false. Or they made the excuse that they were not trained on the method etc. Excuse after excuse after excuse.
Static scoring which is what democrats prefer predicts much more tax revenue and therefore makes it easier to increase spending.
So there you have it.
But this is deja vu. The last GOP Congress under Bush already went down this alley and were unable to enforce it or were unwilling.
Dynamic scoring is an attempt to measure the effects of any given change in revenue or spending and its impact on the over all economy. While it will take decades to refine, a ball park guess is still better then the known wrong error of static scoring. Think of it this way, under dem rules a 100% tax on peoples incomes gives the gov everything. In reality a 100% tax give the gov nothing because no one is going to work if only the gov gets paid. even 80% won’t produce revenue to the gov. Dynamic scoring is the base principle of the laffer curve. As an economist myself its a no brainer.
Besides the change in population purchasing behavior, there is also the waste nessesitated by being a government program. when you buy something for yourself its worth the price you paid, assuming your not a moron. Your local gov has to bill for the admin costs, so in gerneral your local gov service gets you $1 for a cost to you of $2. and thats efficent when look at state and fed.
The change to dynamic scoring and the end of baseline budgeting, with a bonus program to gov workers that figure out better, faster, cheeper and a payment to whistle blowers based on fraud recovery could cause an attitude change that would begin to solve the budget deficit in a meaningful way. Add a percentage deduction to pension and medical payments related to total budget deficits. make total compensation to all federal emplyees outside of a combat zone reduced by the same percentage of total spending vs revenue and your done, market forces driving spending.
I know what "dynamic scoring" is. And I recognize that it is a more realistic way of projecting the ipact of tax policy and spending programs on the economy.
Thus, I am 100% in favor of its adaptation.
My concern is that the greater revenues resulting from tax cuts -- and resultant economic expansion -- will be abused as an excuse for greater spending.
I don't know how to make it any clearer...
When I was in living WDC (1995 - 2004), I participated in an attempt by a group of heavy-hitter conservative economists to convince the Congress that requiring the CBO and JCT to use dynamic scoring would result in more realistic scoring of legislative proposals.
We were not successful, and as a result, some VERY BAD legislation got passed into law based, in part, on the faulty static scoring econometric models used by CBO and JCT.
To the best of my knowledge, dynamic scoring has never been officially used to score legislation in the Congress.
Was your group actually crunching the data? Or were they limited to advocacy only?
Dynamic Scoring (DS) has never been used but it’s been tested against actual results.
The Harvard Economist (forget his name at the moment) who was one of the original writers of the DS equations (the mathematical model) was given access to the data and ran tests against it.
When tax data results came in, the DS Model was applied and compared to the Static Scoring projections. The DS Model showed superior accuracy and more precision every time.
Superior ideas, even tested, confirmed and endorsed methods, are these days not accepted by groups inside the Beltway. DS was even legislated to be used and the democrats stopped it with flimsy excuses.
I was offered access to the tax data as well for a different but related purpose.
One of the things I was busy with was HR 25, the FairTax microeconomic model as it applied to the MacDonald’s corporation supply chain when replacing the federal income tax with a consumption ‘with floor’ (rebate) tax at the consumer end (retail endpoint). The results showed vast superiority of the FairTax application across every metric.
I had met Leo Linbeck Jr. in his offices in Houston, Tx in 2006 (he passed away a year and half ago) and went to DC for a brief time from Seattle to work with the architects of the HR 25 legislation.
Having grown up in DC (father was an attorney under the AG) I had left at age 19 in the early 70s for university work. Upon returning to DC for meetings my JCT contact told me “things have changed in Washington”. He told me “people no longer care so much about what can be done for the nation as much as they care about what’s in it for them”. And it was true.
The JCT and CBO political masters were more interested in closing in on the 300 Billion tax gap left by the underground economy to bring in more revenue to the federal government so that federal committees could have a bigger pie to grow their fiefdoms. It’s all about them; “Good of the Country” is not really a genuine consideration as much as it’s a marketing line for more budget inside committees. My JCT contact coached me that receptiveness of HR 25 could best be gained by angling on the underground economy effect. Of course I was advocating beneficial effects for consumers but found deaf ears. When I addressed how the FairTax captured the underground economy, I was a hot commodity until Nancy Pelosi told Leo Linbeck Jr. that the FairTax would never pass no matter how good it was for the country.
So it doesn’t surprise me that your efforts were shutdown and bad legislation was substituted in its place.
I found in 2006 the republicans to be supportive of improvements and new efficiencies in government whereas democrats were intransigent. Today both parties are intransigent.
“What’s in it for me?” defines Washington DC today for both parties. The political parties truly act like what people call the ‘Uniparty’.
That’s why you’ll see me writing here on FR about Article V and the Convention of States (COS) Project. More people are warming to COS especially given votes like yesterday’s Speaker vote.
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