While the Congressional Budget Office (CBO) was established as a nonpartisan advisory group, an investigation into its operations and personnel suggests notable credibility issues and a left-leaning bias.
Democrats are using CBO analyses of the contentious budget bill to counter President Donald Trump’s significant tax cuts, pushing for reforms to ensure taxpayers aren’t burdened by foreign healthcare costs.
To support their arguments, Democrats and some media outlets often assert that CBOs are nonpartisan. In fact, last year, various media outlets used the term “nonpartisan” with the CBO name over 1,300 times, as reported by the American Accountability Foundation.
However, the CBO’s track record—overestimating public health benefits and downplaying the costs to taxpayers—exposes a partisan influence that seems to sway lawmakers more towards the left.
Besides a history of dubious predictions amounting to nearly $17,000, records show that since 1986, the CBO has donated a mere $250 to a Republican, supporting George W. Bush in 2000, compared to its donations to Democratic candidates.
Lawmakers have relied on the CBO’s inflated public health benefit estimates to validate significant policy changes.
For instance, the CBO projected that 25 million individuals would participate in Affordable Care Act (ACA) exchanges, but fewer than half that number actually signed up following the initiative’s implementation.
Recent investigations and reports highlight ongoing questions regarding the CBO’s reliability and alleged biases.
A January report from the Centre for Economic Policy Innovation titled “How Budget Baselines Are Biased?” highlights the inherent biases in the CBO’s assessments, especially how legislative proposals influence their baseline calculations—benchmarks meant to gauge the financial impact of proposed changes.
“CBOs are legally required to adjust their baseline to favor higher spending and taxes,” the report concluded, emphasizing that these adjustments inflate both spending and income predictions.
During a February hearing before the House Means Committee, Hayden Dublois pointed out the CBO’s poor record in financial forecasting.
He noted that while the CBO initially claimed President Joe Biden’s Inflation Reduction Act (IRA) would cut the deficit by $58.1 billion, revised forecasts indicated it could, in fact, increase the deficit by $300 billion over the next decade.
In another surprising instance, the CBO predicted an additional $7.2 billion in IRS revenue from the IRA, but actual collections fell short, totaling only $1.3 billion—82% less than initially forecasted.
Dublois cited further inaccuracies in CBO predictions regarding the ACA and Medicaid.
Back in 2010, the CBO estimated that 13 million healthy adults would enroll in Medicaid across all states. Yet by 2019, just before the Covid pandemic, the enrollment was 19.5 million in 34 states that expanded Medicaid.
During the pandemic, the CBO miscalculated Medicaid expenditures from 2020 to 2023, leading to significant underestimations that contributed to a 20% overage compared to their prior forecasts.
The 2024 report from the American Accountability Foundation revealed many instances of what it termed false predictions from the CBO, which led to lawmakers sharing incorrect information about legislative impacts.
Notably, the CBO’s initial estimates of ACA exchange participation turned out to be significantly inflated, and its projections for unemployment insurance costs under the American Recovery and Reinvestment Act were revised upward by more than $24 billion after initial estimates proved inaccurate.
Though the CBO significantly underestimated food stamp spending post the stimulus package, it originally estimated $2 billion in changes over ten years. Conversely, the actual allocations reached nearly $20 billion within five years, with a subsequent CBO report acknowledging a $43 billion increase in total SNAP spending over a decade.
In addition to favoring Democratic policies in their analyses, the CBO has, conversely, made Republican proposals appear less appealing.
A December report indicated that the CBO had severely underestimated the economic benefits of Trump’s 2017 tax cuts under the Tax Cuts and Jobs Act (TCJA), which passed solely with Republican support and resulted in economic growth that exceeded earlier forecasts.
However, following Trump’s departure, the CBO appeared to support Biden’s tax incentives for “green” initiatives, initially estimating costs at $271 billion but later revising that figure to over $663 billion—more than double its initial assessment. Some external evaluations even suggested costs exceeding $1 trillion for these initiatives.
The CBO has made various other notable errors, including:
- In 2014, it underestimated the cost of Medicaid expansion under the ACA by over 60%.
- In 2008, during the recession, it inaccurately projected a 2.3% GDP growth in 2009, while the actual figure was 2.9%.
- In 2010, it forecast a real GDP growth averaging 3.2% from 2010 to 2016, but the actual growth was only 2.1%.
- In 2013, it predicted 26 million additional people would enroll in the ACA exchanges by 2017, but later revised that to 10 million—62% lower than the initial prediction.
- In 2014, it estimated that the ACA Risk Corridor Program would generate $8 billion in three years, but insurers instead faced significant losses.
A deeper dive into the political activities of CBO staff, especially in the health analysis division, unveils a startling left-wing bias.
A report from the American Accountability Foundation indicated that 84% of CBO medical staff are registered with or have funded Democratic candidates. This includes high-ranking officials within the department.
Additionally, the CBO’s Chief Economist, Mark Doms, who holds a key position within the agency, has donated over $1,162 to Democratic causes and is a registered Democrat.
The flawed predictions alongside staff affiliations raise significant doubts about the CBO’s commitment to impartial analysis and its promises of hiring without regard to political affiliation, as stated on its website.
As Congress deliberates significant reforms through the Budget Reconciliation Bill, both lawmakers and voters may have viable reasons to question the CBO’s evaluations.
