Thursday, July 16, 2009

What a good economist should be doing

The Times reports how CBO directory Doug Elmendorf isn't telling Congress what it wants to hear about its draft health care bills. There is nothing in the bills that will decelerate health care spending; rather, they increase it by expanding coverage. While the latter is a noble pursuit, it doesn't come free.

Doug should be proud of being such a cantankerous economist. From a scientific perspective, the best advice for policymakers is the truth, not cheerleading. I just hope he hasn't ticked off enough people on both sides of the aisle to jeopardize his reappointment. Or alternatively, I hope that he's ticked off both sets just enough to appear completely neutral.

This all stands in contrast to the maelstrom of finger-pointing regarding the estimates of Medicare Part D, the new prescription drug expansion, back in 2003 and 2004. That primarily involved the executive branch and not the CBO, which is independent. Because CBO typically takes administration estimates as at least a starting point, however, I bet some of the withheld information ultimately may have biased their estimates then too, however unintentionally.