Testimony on the Congressional Budget Office’s Work in 2017 and Plans for the Future
On January 30, 2018, Director Keith Hall testified before the House Budget Committee on CBO’s work in 2017 and the agency’s plans for the future.
CBO’s mission is providing nonpartisan budgetary and economic analysis to support the work of this Committee and the Congress as a whole. My colleagues and I are devoted to that mission, and I appreciate the opportunity to discuss how CBO has executed it this year and how we plan to expand our work in the future.
I also want to take this opportunity to thank you for your support and guidance. We at CBO have long relied on the budget committees to explain to others in the Congress what our role is, to provide constructive feedback on how we can best serve the Congress, and to provide guidance on what legislative developments are occurring and what the Congress’s priorities are. That work on your part has been key to our success over the years.
CBO’s Work in 2017
In the past year, we have provided the Congress with 740 formal cost estimates and mandate statements, thousands of informal cost estimates, 128 scorekeeping tabulations, 86 analytic reports and working papers, dozens of files of data underlying budget and economic projections, and numerous other publications. Many of the cost estimates were produced under very tight time constraints and required extraordinary efforts by our staff to meet legislative deadlines.
We also undertook new initiatives to enhance our responsiveness and transparency. We reorganized work processes and shifted resources to areas of high demand. We published more evaluations of our projections about the economy, spending, and health insurance subsidies. We documented more of our analytic methods—about flood insurance, pension benefit guarantees, and health care for the military, for example. And we gave more explanations of changes in our estimates, addressing issues ranging from Social Security to options for changing Medicare.
CBO’s Future Plans
In the next two years, CBO plans to continue to support the budget committees and the Congress by producing budget and economic baseline projections, reports about those projections, and cost estimates for many proposals, including all legislation reported by committees. Other major products will include a volume of policy options that would reduce budget deficits, reports on the long-term budget outlook, analyses of the President’s budget proposals, monthly budget reviews, and policy analyses on a broad array of topics of interest to Congressional committees. CBO is reviewing and updating every aspect of its simulation model of health insurance coverage, which forms the backbone of its budget projections related to federal health care spending for people younger than 65. In addition, CBO will further develop its capabilities to assess the macroeconomic effects of fiscal policies and the ways that changes in federal regulations affect the agency’s baseline budget projections.
Responsiveness and transparency are top priorities of mine, and we have plans to bolster them further. We will make greater use of team approaches to handle surges in demand for analysis of particular issues. We will increase public documentation of our computer models. We will also do more to explain how analysts employ those tools as part of the process for producing estimates. For a cost estimate, for example, an analyst identifies the ways in which a proposal might affect the budget and assesses which of them would probably have substantial effects. The analyst also consults experts and examines the most relevant data and research to form a basis for the estimate—which includes determining which models to use (if any), what information to put into those models, and how to use their output in combination with other available information. In short, estimates are produced not by models but by analysts; a model is only one of many tools that they might use.
We will be able to make significant progress on our plans to boost responsiveness and transparency if we receive funding for fiscal year 2018 within the range that the Senate and House Appropriations Committees have recommended ($48.1 million and $48.5 million, respectively). If we receive the funding available under the continuing resolution currently in effect for this year ($46.2 million), we will make less progress. Moreover, CBO’s ability to buy data and research and to pay for other standard activities would be severely limited under the funding specified in the continuing resolution, and the agency’s performance of its mission would be degraded.
Many initiatives of great interest to the Congress could be undertaken only if CBO had more employees, so we have submitted a budget request to hire 8 new staff members in 2019 to bolster our responsiveness and transparency, as part of a plan to hire a total of 20 by 2021. The new staff would help CBO respond to requests for information more quickly when there is a surge in demand. They would also allow CBO to supply more information about its analysis and models without reducing the valuable services that it provides to the Congress at its current staffing level. In the next two years, CBO also proposes to expand analytical capacity by adding new health care analysts and creating additional on-site capacity to use sensitive data securely.
I am delighted to talk with you about our work today and would be at any time in the future as well. I am always happy to meet with Members of Congress or to chat on the phone. In addition, our employees meet frequently with Congressional staff to explain our analyses and to answer questions individually and in groups, and we have plans to be in still better contact. For instance, earlier this month, in collaboration with the Congressional Research Service, my colleagues gave presentations to 150 Congressional staff members about how CBO develops estimates of health insurance costs and coverage. We are constantly looking for ways to serve your needs better, and I welcome your suggestions.