320 Years of History
Gold Member
Let's say you are a legislator or influencer of public policy. You have come across a bill that has been passed and signed into law (I'll call the signed bill "The Amendment"). Now you have reservations about it and you want to repeal it. Let's also assume you and some of your fellow legislators asked the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JTO) to evaluate the impacts of repealing the law in question, asking several specific questions and the CBO and JTO provided the following feedback:
Summary of the major impacts of repealing The Amendment
How would a repeal affect the budget and the economy over the next 10 years?
CBO and JCT’s estimate that repealing The Amendment would increase deficits by $353 billion over the 2016–2025 period, excluding the budgetary impact of macroeconomic feedback, has four major components:
This thread's questions are:
If the preceding were the feedback you received, given the choice of repealing The Amendment or not repealing it, which option would you choose?
Summary of the major impacts of repealing The Amendment
CBO and JCT estimate that repealing The Amendment would have several major effects, relative to the projections under current law:
- For many reasons, the budgetary and economic effects of repealing The Amendment could differ substantially in either direction from the central estimates presented in this report. The uncertainty is sufficiently great that repealing The Amendment could reduce deficits over the 2016–2025 period—or could increase deficits by a substantially larger margin than the agencies have estimated. However, CBO and JCT’s best estimate is that repealing the ACA would increase federal budget deficits by $137 billion over that 10-year period.
- Including the budgetary effects of macroeconomic feedback, repealing The Amendment would increase federal budget deficits by $137 billion over the 2016–2025 period. That estimate takes into account the proposal’s impact on federal revenues and direct (or mandatory) spending, incorporating the net effects of two components:
- Excluding the effects of macroeconomic feedback—as has been done for previous estimates related to The Amendment (and most other CBO cost estimates)—CBO and JCT estimate that federal deficits would increase by $353 billion over the 2016–2025 period if The Amendment was repealed.
- Repeal of The Amendment would raise economic output, mainly by boosting the supply of labor; the resulting increase in GDP is projected to average about 0.7 percent over the 2021–2025 period. Alone, those effects would reduce federal deficits by $216 billion over the 2016–2025 period, CBO and JCT estimate, mostly because of increased federal revenues.
- Excluding the effects of macroeconomic feedback—as has been done for previous estimates related to The Amendment (and most other CBO cost estimates)—CBO and JCT estimate that federal deficits would increase by $353 billion over the 2016–2025 period if The Amendment was repealed.
- Repealing the Amendment would cause federal budget deficits to increase by growing amounts after 2025, whether or not the budgetary effects of macroeconomic feedback are included. That would occur because the net savings attributable to a repeal of the law’s provisions would grow more slowly than would the estimated costs of repealing The Amendment's other provisions—in particular, those provisions that reduce updates to payments to suppliers. The estimated effects on deficits of repealing The Amendment are so large in the decade after 2025 as to make it unlikely that a repeal would reduce deficits during that period, even after considering the great uncertainties involved.
How would a repeal affect the budget and the economy over the next 10 years?
CBO and JCT’s estimate that repealing The Amendment would increase deficits by $353 billion over the 2016–2025 period, excluding the budgetary impact of macroeconomic feedback, has four major components:
- All told, CBO and JCT estimate that repealing The Amendment would raise federal deficits by $137 billion over the 2016– 2025 period through its impact on direct spending and on revenues. A repeal would reduce deficits during the first half of the decade but would increase them by steadily rising amounts from 2021 through 2025. Including the effects of macroeconomic feedback, a repeal of The Amendment would increase the federal budget deficit by $9 billion in 2021, rising to $98 billion in 2025.
- Taking into account the effects on federal revenues and direct spending but excluding the budgetary effects of macroeconomic feedback, CBO and JCT estimate that a repeal of The Amendment would increase federal deficits by $353 billion over the 2016–2025 period. That figure reflects an estimated reduction in outlays of $821 billion that is more than offset by an estimated reduction in revenues of $1,174 billion. The resulting estimate of the effects on deficits is substantially larger than the one CBO and JCT issued in in the past for a similar proposal to repeal The Amendment -- a difference that mostly reflects a shift in the budget window to encompass later years in which repealing The Amendment would increase budget deficits sharply.
This thread's questions are:
If the preceding were the feedback you received, given the choice of repealing The Amendment or not repealing it, which option would you choose?
- Repeal it.
- Don't repeal it.