While the Congressional Budget Office reported that President Barack Obama’s healthcare bill would lower federal deficits by $138 billion, the budget office “is required to take written legislation at face value and not second-guess the plausibility of what it is handed,” says former CBO director Douglas Holtz-Eakin.
“So fantasy in, fantasy out.”
Strip out all the gimmicks and budgetary games and rework the calculus, a wholly different picture emerges: The healthcare reform legislation would raise, not lower, federal deficits, Holtz-Eakin writes in The New York Times.
“Removing the unrealistic annual Medicare savings ($463 billion) and the stolen annual revenues from Social Security and long-term care insurance ($123 billion), and adding in the annual spending that so far is not accounted for ($114 billion) quickly generates additional deficits of $562 billion in the first 10 years,” Holtz-Eakin points out.
“And the nation would be on the hook for two more entitlement programs rapidly expanding as far as the eye can see.”
The federal deficit, he notes, is expected to exceed at least $700 billion every year over the next decade, doubling the national debt to more than $20 trillion.
“By 2020, the federal deficit — the amount the government must borrow to meet its expenses — is projected to be $1.2 trillion, $900 billion of which represents interest on previous debt,” Holtz-Eakin says — and Obamacare will only increase this crushing debt.
An especially vivid example of how the legislation manipulates revenues, Holtz-Eakin says, is the provision to have corporations deposit $8 billion in higher estimated tax payments in 2014, thereby meeting fiscal targets for the first five years.
“Since the corporations’ actual taxes would be unchanged, the money would need to be refunded the next year,” he says.
“The net effect is simply to shift dollars from 2015 to 2014.”
The House of Representatives narrowly approved the Obama administration’s healthcare legislation Sunday night, voting 219-212 for passage.
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