Fact Checking Republican Claims About the Joint Committee and Revenue

Statement

In order to enact their plans to gut Medicare and Medicaid, Republicans have been erroneously asserting that the Joint Committee created under the Budget Control Act of 2011 will be unable to consider proposals to increase revenues because such legislation must be scored against a current law baseline--which assumes that all of the 2001 and 2003 tax cuts expire along with relief from the Alternative Minimum tax. This charge is plain wrong for several reasons.

First, many proposals for raising revenue that Congress has been debating during these ongoing budget debates call for repealing tax breaks for oil and gas companies, corporate jet owners, and businesses that ship jobs overseas. As these and similar proposals would eliminate tax breaks that are not set to expire, they would clearly raise revenue against current law. No politician on either side can dispute this fact and neither would CBO.

Second, nothing in the Budget Control Act prevents the Committee from requesting that legislative proposals be scored against multiple baselines. The Act specifically states that the final legislative recommendations of the Committee must include a statement of the deficit reduction achieved, without specifying what baseline should be used to measure that deficit reduction. This gives the Committee the authority not just to request estimates under alternative baselines, but to state how much deficit reduction was achieved relative to those baselines. Also, it is not uncommon for the Congressional Budget Office to score the cost of legislation against baselines other than current law. For example, at Chairman Ryan's request, CBO scored his "Roadmap" proposal that would have repealed all taxes on the wealthy while privatizing Social Security and Medicare against an alternative baseline that assumed all of the 2001-03 tax cuts were permanently extended.

In another, more recent example, Republican staff asked CBO to score their version of the Budget Control Act against a January baseline rather than a current CBO baseline. In fact, Chairman Ryan used those estimates against the old baseline in his August 2 blog asserting that the Budget Control Act "achieves two-thirds of the discretionary spending cuts called for in the House-passed budget." This assertion is not true if one measures against CBO's most recent estimates, which incorporate the impact of final 2011 appropriations. In other words, Chairman Ryan uses an alternate baseline in the same blog where he argues the Committee should only use a current CBO baseline.

Republicans' assertion that the Joint Committee can only use the CBO current law baseline is especially ironic because it suggests that allowing the 2001-03 tax cuts to expire is not a tax increase even though Republicans have frequently asserted that returning to current law represents a huge tax increase. Indeed, in his blog post, Chairman Ryan argues that adhering to current law would result in "massive tax hikes" on the American people. But, if that is the case, then such revenue would obviously reduce the deficit. Isn't reducing the deficit the goal of the Committee? Our Republican colleagues will apparently continue to hold contradictory positions and use contorted logic to shield special interests and the very wealthy from sharing responsibility for reducing the deficit.

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