Wednesday, February 09, 2005

Comparative Book-Cooking

The Bush administration is conducting quite a tutorial this week in the dark art of cooking the fiscal books.

First, you've got the by-now-customary virtuosity with which the Bushies deal with the costs of their tax cuts. Back in '01, of course, they sold their tax cut package as only costing a little over a trillion smackers by pretending the cuts would expire. Then, suddenly, they treated any suggestion that the cuts would indeed expire as a call for "tax increases," and also narrowed the budget window so that the visible cost of permanent tax cuts would be vastly lowballed as well. The latest wrinkle in this game is the administration's proposal that budget rules be changed to estimate the cost of extending or making permanent any and all tax cuts as zero. Quite a sequence, eh? Distort the cost, then minimize it, then officially abolish it. The definitive piece the DLC published opposing Bush's original tax cuts was entitled "The Emperor's New Clothes," and that's turned out to be a more prophetic title than we imagined.

Now, with the Medicare Rx drug benefit the administration pushed through Congress in 2003, the Bushies couldn't play exactly the same kind of game. I mean, what's the point of announcing a new entitlement program if you're going to pretend it's only an entitlement for a few years? To be sure, the administration and its congressional allies messed around with the phase-in of the new benefit to hide the true costs. By delaying the full implementation until 2006, they were able to squint sideways at the benefit and claim it just might squeak by at a ten-year cost of under $400 billion, which is all the congressional budget guidelines allowed. And moreover, they hoped to build support for the benefit by putting the easy candy up front--a cost-free drug discount card--hoping seniors would buy into the program before they had to deal with the convoluted, expensive, yet disappointingly stingy premium and coverage system involved in the whole enchilada.

Nobody really believed the original numbers, though the administration went to great lengths to hide internal estimates showing the true cost ballooning like a carbo-loading refugee from an Atkins clinic. This week, almost casually, the administration let it be known that the true ten-year cost of the benefit will come in at a cool $1.2 trillion. If you believe their estimates of premium revenue and of "offsets" from seniors leaving Medicaid for the shiny new Medicare, hey, it's only $720 billion! Such a deal.

The bottom line is that these folks are resourceful and absolutely shameless when it comes to cooking the fiscal books. And as Rep. Rahm Emanuel of Illinois pointedly remarked at a congressional hearing yesterday: these are the same guys who want us to believe their 50-year Social Security cost and revenue estimates are right on the money.

With this administration, what we need is not so much independent counsels, but independent accountants.
-- Posted at 2:37 PM | Link to this post | Email this post

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