3 ms·
First, that WSJ editorial is pay-walled, so I’m not going to respond to anything from the WSJ editorial. Rather, I’ll respond to the Penn Wharton analysis [1]
by ncallaway 5y ago
First, that WSJ editorial is pay-walled, so I’m not going to respond to anything from the WSJ editorial. Rather, I’ll respond to the Penn Wharton analysis [1]
First, I don’t take exception to the Penn Wharton decision to assume permanency of a bill (though it’s odd to me when the press then refers to it as a scoring of the reconciliation proposal, when it explicitly notes that it isn’t a scoring of the proposed legislation). However, it does seem odd to me to rely on such a scoring to describe the inflation of that assumed spending as “inevitable”.
Is it fair to say it’s the goal of the Democrats pushing this legislation to make these programs permanent? Yes, that’s the goal. Does that guarantee that will be the case? As someone who wants many of these programs to become permanent, no, it’s absolutely not inevitable that these programs will become permanent.
Second, the argument was not that spending will increase, but that debt to GDP to increase. For that to be the case, you need to show that the debt will increase (and faster than GDP).
To do that, you need to consider the revenue side as well. The JCT score considers the actual proposal (not the assumed future proposal) and finds revenue that mostly offsets the spending [2]. This means the “spending proposal” would have limited impact on the deficit, and therefore the debt.
The Penn Wharton scoring does absolutely nothing to convince me of the inevitability of the debt to GDP increasing. First, it’s based on at least two pieces of hypothetical legislation. Second, it assumes no revenue changes are made when those programs are made permanent.
[1] https://static1.squarespace.com/static/55693d60e4b06d83cf793431/t/6181c23b3cf4ee35c5a57fe6/1635893819197/Estimate_Reconciliation+Framework.pdf https://static1.squarespace.com/static/55693d60e4b06d83cf793...
[2] https://www.jct.gov/CMSPages/GetFile.aspx?guid=3fbf5966-deea-41eb-a159-eda2c599e56b https://www.jct.gov/CMSPages/GetFile.aspx?guid=3fbf5966-deea...