Saturday, January 8, 2011

Repealing healthcare adds billions of dollars to the deficit

House Republicans are in a pickle: Repealing health-care reform would cost hundreds of billions of dollars -- and Eric Cantor knows it. One of the new rules set forth by the House Republican majority says that new legislation must be paid for. But the health-care bill reduces the federal deficit by more than $100 billion over the next 10 years. Luckily, they've figured out an answer to their problem: They've decided to simply exempt the repeal bill from the rules. That means they're beginning the 112th Congress by lifting their own rules in order to take a vote that will increase the deficit. Change we can believe in, and all that. 

Republicans are aware that this looks, well, horrible. So they're trying to explain why their decision to lift the rule requiring fiscal responsibility is actually fiscally responsible. Majority Leader Eric Cantor got asked about this, and he returned the reporter's serve with a volley of nonsense. "About the budget implications, I think most people understand that the CBO did the job it was asked to do by the then-Democrat majority, and it was really comparing apples to oranges,” Cantor said. “It talked about 10 years' worth of tax hikes and six years' worth of benefits. Everyone knows beyond the 10-year window, this bill has the potential to bankrupt this federal government as well as the states."

That's all well and good -- but it's not true. Take Cantor's core point: The health-care reform bill includes "10 years' worth of tax hikes and six years' worth of benefits." There's nothing philosophical about this statement. It can be checked with a simple look at the spending tables the Congressional Budget Office published in their analysis of the bill. And when you look at those tables, Cantor's statement falls apart:

Roughly speaking, new spending is what counts as "benefits." New taxes are the turquoise bar at the bottom. In years one, two, and three, new benefits are larger than new taxes. In year four, that's not true, but the difference is fairly small. And in the six years after that, even Cantor admits the benefits match or overwhelm the taxes.

Mr. "Fiscal Responsibility" Cantor is lying through his teeth.

from an article by Ezra Klein