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**FEBRUARY 12, 2021**

Kuttner on TAP

One More Republican Needs to Go-the Head of CBO

****

As the

**Prospect** has reported
,
the Congressional Budget Office, supposedly a "neutral" source of
technical assessment, has completely misstated the net impact of a $15
minimum wage. The details are wonky-check out EPI's evisceration
here
-but
basically CBO overstates costs, miscalculates the interaction between
wages and prices, and understates benefits.

The benefits include reduced reliance on public assistance, increased
tax revenues, and wage increases for a total of 27 million American
workers. All of that would produce macroeconomic stimulus and generate
jobs. Also, the $15 minimum wage is part of a $1.9 trillion stimulus
package that itself will boost jobs, and the package needs to be
understood as a whole.

Yesterday, CBO admitted that it had made a doozy of a miscalculation in
its September projection of increased national debt
. Thanks to an improved economic
outlook for late this year and next as the recovery kicks in, CBO now
projects the debt to be just 107 percent of GDP by 2031. This is far
less than previously estimated, and well below the World War II peak.

But CBO's earlier projections added to the anti-stimulus hysteria.
These estimates, which change with the winds, are treated as Scripture.
CBO is allegedly nonpartisan, but its brand of economic analysis is
deeply conservative.

Its director is a Republican, Phil Swagel. He was formerly assistant
Treasury secretary for policy under Hank Paulson in the George W. Bush
administration.

Swagel was appointed for a four-year term in 2019, at a time when
Republicans controlled the Senate and Democrats had the House. He was
pushed for the job by Republican Sen. Mike Enzi of Wyoming, then the
chair of the Senate Budget Committee, and OK'd by House Budget chair
John Yarmuth of Kentucky, a progressive. Today, the Senate Budget chair
is Bernie Sanders.

At the very least, Sanders and Yarmuth need hearings challenging CBO on
the way they do economics. Swagel can only be removed during his term
for gross misfeasance. Well, CBO has just demonstrated it.

~ ROBERT KUTTNER

Follow Robert Kuttner on Twitter

Robert Kuttner's latest book is
The Stakes: 2020 and the Survival of American Democracy
.

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