I've been documenting the various tricks Democrats have been employing to argue that their health care legislation would cost less than $900 billion over 10 years and not add to deficits. Their tactics include promising cuts to government programs that future lawmakers are unlikely to actually enact and moving $247 billion of spending on Medicare doctors' payments to a separate bill while claiming that it has nothing to do with health care (even the Washington Post editorialized that this was "nonsensical"). But another way that Chairman Max Baucus was able to keep the cost of the Senate Finance Committee legislation down (as measured by the Congressional Budget Office) was just a simple gimmick.
Given that the CBO only puts a price tag on the first 10 years of a piece of legislation, Democrats realized that they could simply delay the enactment of the major spending provisions of the bill by four years, thus creating the illusion of a bill that costs $829 billion over 10 years. But in actuality, the bill is projected to cost just $14 billion in the first four years, and $70 billion through its fifth year. You can see this in the below table breaking down the CBO spending projections:
I demonstrate this graphically below. The red shaded area to the left of the line represents all of the spending in the first half of the 10 year period the CBO evaluated, and everything to the right of the line represents spending in the second half of that 10 year period. About 98 percent of the spending comes in the last six years, and 92 percent comes in final five year period. Thus, the true 10-year cost of the Baucus bill is well above $1 trillion, and according to estimates cited by Republicans, it's actually $1.8 trillion.
Pingback| 10.19.09 @ 1:49PM
Twitter Trackbacks for The American Spectator : AmSpecBlog : Baucus's Accounting Tri links to this page. Here’s an excerpt:
Tim| 10.19.09 @ 2:29PM
that's one hell of a hill to have to climb...
Pete| 10.19.09 @ 2:49PM
don't worry, your kids and grandkids will carry the brunt of the burden.
Richard| 10.19.09 @ 3:04PM
The chart could have been better Philip. Actually you needed two charts. One chart for the documented 829 and one chart for the 829 + 247 Billion doctors payments. Other than that, I found the article useful.
Ken (Old Texican)| 10.19.09 @ 3:05PM
Mr. Llein
Duh...our communists in power are liars. Please get over it and move forward to firing them all.
Thank you
Si Vis Pacem| 10.19.09 @ 9:02PM
Hey Ken,
Speaking of liars... When's Bob going to drop by and show us a graph "proving" this was all Reagan's fault?
Pingback| 10.19.09 @ 4:09PM
The American Spectator : AmSpecBlog : Baucus's Accounting Trick | Money Blog : 10 Dol links to this page. Here’s an excerpt:
Eric R| 10.19.09 @ 4:38PM
Why don't good-government types (or the loyal opposition) insist on "present value" accounting for government programs?
i.e. in the private sector we compare proposals for future streams of spending/income by estimating the total present value of those streams. Takes all the gimmickry out of flim-flam proposals that look too good to be true.
Warrior| 10.19.09 @ 5:29PM
At least it's not a hockey stick.
Pingback| 10.19.09 @ 8:13PM
A message on healthcare that reaches out to conservatives in a way they understand - links to this page. Here’s an excerpt:
Pingback| 10.19.09 @ 8:53PM
The Insider’s Get More Biz, Godfather Principles and Accounting & Finance for Anti-ce links to this page. Here’s an excerpt:
Real American| 10.19.09 @ 9:00PM
I wonder whether any of the "real" news organizations will raise these questions...LOL. Of course not. They're shills for the almighty God, Lord Big Government Socialism.
Pingback| 10.19.09 @ 9:38PM
The American Spectator : AmSpecBlog : Baucus's Accounting Trick links to this page. Here’s an excerpt:
Pingback| 10.19.09 @ 9:44PM
It’s War… Between Health Insurance Companies and Congress « Frugal Café Blog Zone links to this page. Here’s an excerpt:
Pingback| 10.19.09 @ 9:46PM
Gov. Pawlenty’s Sound Argument about Health Care Reform: Need to Focus on What Drive links to this page. Here’s an excerpt:
Pingback| 10.19.09 @ 11:42PM
Healthcare cost visualization | And Still I Persist links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 2:33AM
The American Spectator : AmSpecBlog : Baucus's Accounting Trick PV online links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 6:20AM
No Runny Eggs » Blog Archive » How Do You Hide $475 Billion links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 8:04AM
Health Care BS - BAUCUS BUDGET BS links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 10:18AM
Michelle Malkin » The “vapor bill” materializes, but don’t spend too much reading it links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 12:35PM
Democrats’ Healthcare Bill – Graphed « Gop3.com: The Triumvirate links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 1:47PM
New ObamaCare Audacity: Bribes for Doctors, Led by Nevada’s Senator Harry Reid? « Fr links to this page. Here’s an excerpt:
Pingback| 10.20.09 @ 2:13PM
Conservative Hosts and Ones View of “Bass-Ackwards” Democrat Tactics « Politics 24/7 links to this page. Here’s an excerpt:
Pingback| 10.21.09 @ 5:16PM
Smoke and Mirrors in the Senate Bill | www.statehousecall.org links to this page. Here’s an excerpt:
Pingback| 10.21.09 @ 6:26PM
Baucus’s Accounting Trick « Right Sided American Kafir links to this page. Here’s an excerpt:
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Pingback| 10.21.09 @ 11:18PM
Behind Closed Doors: What Happened to That “Open Door, C-SPAN” Promise about Health links to this page. Here’s an excerpt:
Pingback| 10.22.09 @ 8:11AM
Smoke and Mirrors in the Senate Bill « links to this page. Here’s an excerpt:
Pingback| 10.28.09 @ 11:26AM
Joe Lieberman Knocks Over the ObamaCare Apple Cart, Will Filibuster Against Health C links to this page. Here’s an excerpt: