One of the many disappointing things about Republicans is that they fail to correct problems when they get power. After the 1994 “Gingrich Revolution,” the GOP had complete control of Capitol Hill. This meant complete authority over the Congressional Budget Office and Joint Committee on Taxation. Did Republicans use this power to fire the old staff and put in people who understood economics? Of course not. I don’t know if this is because Republicans are stupid or if it’s because they’re too timid to take steps that would generate complaints from their enemies. Regardless, what really matters is that CBO and JCT are just as biased today as they were 20 years ago. Diana Furchtgott-Roth of the Hudson Institute exposes CBO’s latest shoddy Keynesian analysis. She is correct, and the people making these same arguments 20 years ago were correct. And I’m afraid people will be saying the same things 20 years from now. Which leads me to think that maybe the best approach is to get rid of these bureaucracies.
…on Tuesday the nonpartisan Congressional Budget Office issued a report showing that the American Recovery and Reinvestment Act of 2009 increased the number of people employed by between 1.4 and 3.3 million people in the second quarter of 2010 and lowered unemployment by 0.7 to 1.8 percentage points. CBO concludes that without the Recovery Act unemployment, which stood at 9.5% in July, might exceed 10% and possibly be above 11%. There’s just one problem. CBO’s latest figures are inconsistent with its claims of the effects of the stimulus bill when it was passed in February 2009. If its models failed to accurately predict the effects of the stimulus bill then, why should we believe the models now? This is important because some are taking the CBO report as proof that the stimulus bill is working and so we need…more stimulus. …After passage of the stimulus bill, in a March 2009 letter to Iowa Senator Chuck Grassley, CBO predicted that the unemployment rate in the last quarter of 2009 would rise to 9% without the stimulus package, from its then-current level of 8.2%. With the stimulus, CBO said, the unemployment rate would range from 7.8% to 8.5%. The actual rate in December, 11 months after enactment of the stimulus, was 10%, far higher than CBO said it would be absent the stimulus. …If Americans had known in February of 2009 that the $787 billion stimulus package (whose cost CBO later raised to $862 billion) would not lead to declines in unemployment, but instead a substantial increase in the unemployment rate to 9.5%, opposition to the spending would have been practically universal. Put it another way – if Americans were asked now whether they would prefer today to have back the February 2009 unemployment rate of 8.2% and the $862 billion spent on stimulus, they would say yes. Some say things would have been worse if the stimulus funds had not been spent. They assume that more government spending, including the $862 billion stimulus, must be good for the economy. This form of Keynesian economics fell out of fashion decades ago everywhere, except in the halls of power in Washington. If more government spending always helped the economy, why stop at $862 billion? Why not give each American an unlimited bank account? Then the unemployment rate would likely rise to 100%. But some economists would still offer unverifiable models to “prove” the benefit to the American public.
[…] When I first started writing this daily column, the Congressional Budget Office was infamous for dodgy economics. […]
[…] cbo — over and over again — produced reports based on Keynesian methodology to claim that Obama’s so-called […]
[…] I think that’s a tactically and morally dubious approach. It’s tactically misguided because the Ryan budget supposedly hurts growth from 2015-2017 according to CBO’s short-term Keynesianism. […]
[…] far as I’m concerned, the bureaucracy should be shut down. And if Republicans win the Senate in the 2014 elections, it will be interesting to see whether […]
[…] far as I’m concerned, the bureaucracy should be shut down. And if Republicans win the Senate in the 2014 elections, it will be interesting to see whether […]
[…] I’ve bashed the biased and inaccurate work of the Congressional Budget Office, I found this cartoon very […]
[…] I’m irritated about CBO’s bias (and the fact that it’s being financed with my tax dollars), that’s not what has me […]
[…] I’ve bashed the biased and inaccurate work of the Congressional Budget Office, I found this cartoon very […]
[…] is why I’ve argued it may be best to shut down CBO and also written that – at a minimum – sweeping reform of the Capitol Hill bureaucracy […]
[…] is why I’ve argued it may be best to shut down CBO, and also written that – at a minimum – sweeping reform of the Capitol Hill bureaucracy […]
[…] Not that I have any faith in CBO estimates. After all, those bureaucrats still embrace Keynesian economics. […]
[…] Not that I have any faith in CBO estimates. After all, those bureaucrats still embrace Keynesian economics. […]
[…] Not that I have any faith in CBO estimates. After all, those bureaucrats still embrace Keynesian economics. […]
[…] I’ve bashed the biased and inaccurate work of the Congressional Budget Office, I found this cartoon very […]
[…] This obviously shows the mendacity of Democrat politicians, but let’s also make sure that CBO takes a lot of the blame. The bureaucrats deliberately low-balled expenditure estimates to please their political masters. If Republicans had any brains, they would fire all of them. […]
[…] This obviously shows the mendacity of Democrat politicians, but let’s also make sure that CBO takes a lot of the blame. The bureaucrats deliberately low-balled expenditure estimates to please their political masters. If Republicans had any brains, they would fire all of them. […]
[…] performance if the burden of spending had been reduced rather than increased. One can only hope the statists at the Congressional Budget Office learn from this […]
[…] performance if the burden of spending had been reduced rather than increased. One can only hope the statists at the Congressional Budget Office learn from this […]
[…] performance if the burden of spending had been reduced rather than increased. One can only hope the statists at the Congressional Budget Office learn from this […]
[…] performance if the burden of spending had been reduced rather than increased. One can only hope the statists at the Congressional Budget Office learn from this […]
[…] work of the Congressional Budget Office. The CBO did an awful job on the stimulus, for instance, repeatedly asserting that diverting money from the private sector to government somehow would create jobs. CBO also was […]
[…] work of the Congressional Budget Office. The CBO did an awful job on the stimulus, for instance, repeatedly asserting that diverting money from the private sector to government somehow would create jobs. CBO also was […]
[…] work of the Congressional Budget Office. The CBO did an awful job on the stimulus, for instance, repeatedly asserting that diverting money from the private sector to government somehow would create jobs. CBO also was […]
[…] work of the Congressional Budget Office. The CBO did an awful job on the stimulus, for instance, repeatedly asserting that diverting money from the private sector to government somehow would create jobs. CBO also was […]
[…] in turn, would drive up interest rates, Elmendorf said. I’ve already written once about how the GOP sabotaged itself when it didn’t fix the problems with these scorekeeping bureaucracies after 1994. If Republicans take power and don’t […]
I agree with Dan (and Matt) 100%.
You can never go wrong by getting rid of bureaucrats.