Congressional Budget Office September 6, 2017 How CBO Promotes - PowerPoint PPT Presentation

Congressional Budget Office September 6, 2017 How CBO Promotes Integrity in Its Analyses Presentation at the Batten School of Leadership and Public Policy, University of Virginia Keith Hall Director

The Congressional Budget Act of 1974 1 CONGRESSIONAL BUDGET OFFICE

The act created a formal process through which the Congress could develop, coordinate, and enforce its budgetary priorities . As part of that process, the act created the House and Senate Budget Committees and the Congressional Budget Office. 2 CONGRESSIONAL BUDGET OFFICE

The House and Senate Budget Committees oversee the budget process, draft an annual budget plan, and monitor action on the budget. CBO provides the budget committees and the Congress with objective, impartial information about budgetary and economic issues. 3 CONGRESSIONAL BUDGET OFFICE

CBO’s Nonpartisanship 4 CONGRESSIONAL BUDGET OFFICE

CBO’s Director is appointed jointly by the Speaker of the House and President Pro Tempore of the Senate to a four-year term. CBO has 235 employees— hired solely on the basis of professional competence, without regard to political affiliation. Most have advanced degrees. 5 CONGRESSIONAL BUDGET OFFICE

CBO does not  Make policy recommendations  Write legislation  Implement programs or regulations  Enforce budget rules  Evaluate the historical effectiveness of government programs 6 CONGRESSIONAL BUDGET OFFICE

CBO’s Products 7 CONGRESSIONAL BUDGET OFFICE

CBO provides  Baseline budget projections and economic forecasts covering the 10-year period used in the Congressional budget process  Long-term budget projections  Cost estimates for legislation, including analyses of federal mandates  Scorekeeping for enacted legislation 8 CONGRESSIONAL BUDGET OFFICE

And CBO also produces  Analysis of the President’s budget (including economic effects and their budgetary feedback)  Analytic reports about federal programs, aspects of the tax code, and budgetary and economic issues 9 CONGRESSIONAL BUDGET OFFICE

CBO’s Projections 10 CONGRESSIONAL BUDGET OFFICE

CBO’s budgetary and economic projections focus on the next 10 years but sometimes look 20 years ahead or more. They are meant to reflect the middle of the distribution of possible outcomes. 11 CONGRESSIONAL BUDGET OFFICE

The projections incorporate behavioral responses to the extent feasible on the basis of the available evidence. They include explanations of the analysis to the extent feasible. They change periodically as a result of new information . 12 CONGRESSIONAL BUDGET OFFICE

CBO’s Cost Estimates 13 CONGRESSIONAL BUDGET OFFICE

The cost estimates are objective budgetary information that helps the Congress make decisions about proposed legislation . They show how enacting and implementing a bill would affect federal spending and receipts in comparison with current law . They cover a 5-year or 10-year budget window . 14 CONGRESSIONAL BUDGET OFFICE

Formal cost estimates get rigorous review and are signed by the Director. They are generally prepared after a bill is ordered reported by a full committee. Informal cost estimates are generally communicated from CBO’s staff to Congressional staff and are not considered official CBO estimates. They are confidential only as long as proposals are not made public. 15 CONGRESSIONAL BUDGET OFFICE

CBO’s cost estimates contain information about  Effects on the federal budget  Effects on state, local, and tribal governments (including mandates)  Mandates imposed on the private sector  Macroeconomic feedback effects (for major legislation, when practicable) 16 CONGRESSIONAL BUDGET OFFICE

To keep the playing field level, CBO  Releases publicly all formal cost estimates and analytic reports  Sends the material to the sponsor of legislation or the requester of a report, the Chairman and Ranking Member of the committees of jurisdiction, and the budget committees  Posts the work on its website at about the same time 17 CONGRESSIONAL BUDGET OFFICE

CBO’s Analytic Reports 18 CONGRESSIONAL BUDGET OFFICE

Analytic reports go through rigorous internal review by many people at different levels in CBO. The reports incorporate feedback, when that is practical, from outside experts with a broad range of views who specialize in the issue at hand. 19 CONGRESSIONAL BUDGET OFFICE

CBO’s Transparency 20 CONGRESSIONAL BUDGET OFFICE

CBO aims to make its analysis transparent in many ways, including  Explaining the basis of and the revisions to its major economic and budget projections  Describing the uncertainty of its projections and quantifying that uncertainty when appropriate  Evaluating the projections  CBO’s Revenue Forecasting Record  CBO’s Economic Forecasting Record: 2015 Update 21 CONGRESSIONAL BUDGET OFFICE

A Panel of Economic Advisers improves CBO’s understanding of economic research, macroeconomic developments, and economic policy. A Panel of Health Advisers improves CBO’s understanding of health research and of developments in health care delivery and financing. 22 CONGRESSIONAL BUDGET OFFICE

Members of CBO’s panels of advisers  Are widely recognized experts on a range of issues  Have a variety of backgrounds, areas of knowledge, and experience  Join periodic meetings at CBO and provide their views between meetings via email and telephone 23 CONGRESSIONAL BUDGET OFFICE