Testimony on Transparency at CBO: An Update
On September 13, 2018, Director Keith Hall testified before the Senate Budget Committee about transparency at CBO.
The transparency of CBO’s work has always been a priority, and this year the agency has added and shifted resources to redouble its efforts in that area.
CBO has three goals in being transparent:
- CBO aims to enhance the credibility of our work by showing how it relies on data, professional research, and expert feedback.
- CBO seeks to promote a thorough understanding of our analyses by sharing information in an accessible, clear, and detailed manner.
- CBO wants to help people gauge how our estimates might change if policies or circumstances were different.
Over the past year, the agency undertook many activities supporting progress toward those three overarching goals. Almost all of CBO’s employees spent part of their time on those activities, and last month, CBO published a report summarizing them:
- The development of several interactive tools: one that lets users add or subtract brigades, ships, aircraft squadrons, and other units to see the effects on the Department of Defense’s total operation and support costs and the size of the military; one that shows how CBO projects spending on discretionary programs; and one that allows users to enter alternative economic scenarios and see the budgetary results.
- Information about important models that CBO uses, including its microsimulation tax model, its long-term projections model, and its health insurance simulation model.
- Computer code to help analysts understand and replicate parts of CBO’s analyses in papers about the distribution of household income and about macroeconomic output.
- Analyses of the accuracy of CBO’s spending estimates for fiscal year 2017 and of the agency’s projections of subsidies for health insurance under the Affordable Care Act.
- A report on how CBO produces cost estimates, as well as a detailed description of its formal cost estimates and the information that they contain.
CBO also reached out to provide information about its work to Congressional staff. Last week, for example, the agency answered questions at an “open house” for House staff convened by the House Budget Committee. Tomorrow, CBO employees are giving a presentation to Congressional staff—jointly with the Congressional Research Service—about the agency’s baseline budget projections and how they are produced.
In addition, CBO has reached out to many experts for feedback on its analyses. For example, last week CBO announced the formation of a technical review panel to advise the agency on the development and testing of the next generation of its health insurance simulation model.
In response to interest expressed by the Congress, CBO plans during the next year to publish more overviews and documentation of some of its major models and more detailed information, including computer code, about key aspects of those models. The models are used to simulate choices about health insurance, project long-term budget outcomes, forecast business investment, and estimate Medicare beneficiaries’ costs. CBO also plans to update its template for cost estimates to make important information easier to find and read. And the agency will continue to evaluate previous estimates in order to improve future ones. For example, CBO is currently examining how its estimate of the effects of the American Recovery and Reinvestment Act of 2009 on spending for the Supplemental Nutrition Assistance Program compares with what actually happened.
As CBO undertakes these efforts, it will be important to understand which ones are particularly valuable and informative to the Congress and which ones may have less value. Being transparent has costs, and CBO must, in essence, make business decisions weighing the benefits and costs of devoting resources to different activities.