Hope ‘n’ Change: About That Free Lunch

Creative accounting allows Washington to get away with a lot, and the current health care debacle is no exception. Recent analyses of House and Senate proposals by the Congressional Budget Office rely upon static scoring (i.e., not factoring in behavioral changes caused by the legislation,) fantastically optimistic projections and simple omissions of unfavorable facts that trumpet deficit-neutral bills having no basis in reality. The libertarian Cato Institute, for example, took a close look at the CBO’s numbers and discovered a variety of unsupportable claims.

For starters, the 10-year projection that measures out the trillion-dollar House bill in itself is misleading. Most of the bill’s major provisions don’t kick in until 2014, making for a 6-year projection in which costs ramp up slowly. After the first three years of the program, around the time of the 2012 election, costs would accumulate to about $100 billion, relative chump change that will allow Obama’s re-election campaign the opportunity to pledge that health care has been a cost-saving success. But four years beyond that, long after the current president passes the threshold of electoral accountability (assuming he wins, perish the thought), costs catch a fever. Cato estimates a $2.4 trillion tab (even Sen. Harry Reid admits as much), double what the House bill and the CBO project. And what happens after 2019 is a true horror story.

The Baucus bill, all the rage on Capitol Hill these days, is another fraud of epic proportions. It claims to have no impact on the deficit by assuming, in part, that growth rate cuts in Medicare’s physician payments will help offset its $829 billion price tag. All well and good, but Congress never makes those cuts because no one wants to be on record as cutting an entitlement for one of America’s most powerful voting blocs. Just by taking these cuts out of the equation, the bill automatically goes $200 billion into the red. Additionally, there is no reckoning of the built-in costs that will hit consumers, including penalties for high-price insurance plans, penalties for not having insurance and the general rise in cost of various health care procedures over the span of several years.

Obama and his Democrat lackeys have either bullied or beguiled the CBO, once a reliably non-partisan entity, into fabricating analyses concluding that Congress has produced sweeping legislation that does not negatively affect the deficit. If ever the phrase “voodoo economics” applied, it’s now.

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