Static analysis

I’ve often remarked that the Congressional Budget Office’s scorings are of limited use because they don’t take account of how government policies change individual behavior. Thus, their scores are too kind to policies that suppress individual enterprise (that is, big government policies) and are too unkind to policies that promote it.

In a hearing before the House Budget Committee, the CBO’s director acknowledged the truth of this criticism in the context of Obamacare:

Elmendorf: The way I would put it Mr. Chairman, is we don’t model the behavior of physicians. We don’t model the access to care or quality of care.

Ryan: So you assume it stays on as is?

Elmendorf: That is the point we noted in the letter analyzing your proposal. That is a gap in our tool kit and a gap we are trying to fill.

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