The CBO’s word is gospel, except when it isn’t

THE CBO’S WORD IS GOSPEL, EXCEPT WHEN IT ISN’T…. This week, the Congressional Budget Office Director Douglas Elmendorf helped push health care reform off track. Republicans seized on CBO cost concerns to argue that the nation simply can’t afford the reform proposal.

I’ve noted on a few occasions lately that Republican lawmakers love the CBO, just so long as the office is telling them what they want to hear. When the CBO challenges GOP assumptions, the office is, in Eric Cantor’s words, “losing its credibility.”

Sam Stein adds to this with a great example from 2003.

Perhaps the biggest caution flag for treating CBO numbers as gospel — and one of the more illuminating benchmarks from which to compare the current debate over health care costs — is the Iraq War.

In October 2003, the CBO was asked to do a study about the costs of the Iraq War. According to varying scenarios of troop deployment the total price tag ranged from $85 billion to $200 billion over a ten-year period. A year later, the projected costs had risen further. Having already spent $123 billion, the CBO was now estimating that the prosecution of both Iraq and Afghanistan would total roughly $1.1 trillion over the subsequent ten years. […]

By 2007, as the Iraq War had spiraled out of control, and with the surge of troops just beginning to take place, the price tag had jumped even more dramatically. The CBO was now projecting that the government would have to spend as much as $1.7 trillion over the next ten years on Iraq and Afghanistan. With interest, the number rose to $2.4 trillion — $1.9 trillion of which was for Afghanistan alone.

Certainly, the costs of a war — especially one as poorly managed as Iraq — are far more difficult to predict than that for health care legislation. But, at the same time it is worth noting that the 2007 CBO projection for the ten-year cost of the Iraq and Afghanistan wars are roughly double the prospective 10-year cost projections for health care reform.

Now, it’s possible that, in 2003, these Republican policymakers simply didn’t trust the Congressional Budget Office to provide accurate cost estimates. It’s also possible that they simply didn’t care — the war was so important and worthwhile, the U.S. should pay any price and borrow any sum just to make it possible. The war, in other words, was necessary.

Either way, it casts Republican credibility on CBO estimates in an interesting light six years later.