To the president violated the constitution . [shouting] the we the people are in charge of this country. [chanting] the people divided will never be [chanting] the People United will never be divided. [chanting] [chanting] [inaudible conversations] [inaudible conversations] [inaudible conversations] [chanting] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [background sounds] [inaudible conversations] hes fighting a dirty campaign, promoting violence. 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[background sounds] [inaudible conversations] [inaudible conversations] [inaudible conversations] [background sounds] [inaudible conversations] as for seeing all these people, on facebook, every time you go out there, honestly it bothers me because everybody is out here trying to hustle. Nobody is doing anything illegal by protesting here. Thats what were here for. We are here to better ourselves, to advance, be better. We cant speak properly or we dont have the awards, you know, were here to help each other out. [inaudible conversations] when i heard [inaudible conversations] [inaudible conversations] [inaudible conversations] [background sounds] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] it would take either Justice Kennedy or the chief justice as i said, in fact chief justice said [inaudible] but you never know. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] a. And Justice Kennedy, for one, just as he [inaudible conversations] yo. Some of the scene outside the supreme court. They heard organize argument on president obamas actions on immigration. The court will be releasing the audio of the argument on friday. Well play it for you friday evening at 8 00 eastern time on the companion network, cspan. We head right across the street too capitol hill, a discussion on the congressional budget process. Well be hear from House Budget Committee chair, tom price, of georgia, followed bay conversation about longterm budget reforms, hosted by the commitow for a responsible federal budget, from the Rayburn House Office building. Live coverage right here on cspan2. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] here on capitol hill, discuss about to get underway on the congressional budget process. Well hear from Budget Committee chair, tom prize, followed by a conversation about longterm reforms, hosted by the committee for a responsible federal budget from the Rayburn House Office building, and then later tonight, more of cspans road to the out white house. With donald trump at 7 00 eastern time. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] okay, thank you, everybody. Welcome. I run the committee for responsible federal budget. Thanks very much for everybody who came today. A very good, expert audience. Were also we also have cspan live. Hello everybody again. Okay. So, we have cspan with us today live, which is terrific. We have a broad audience and thanks to everybody here. We have pretty much all the leading budget experts in the city in this room so very thrilled to have you with us. Our topic today is fixing the broken budget process. This is a topic that anybody who know this budget or the rules that guide it is familiar with it. Theres a whole another of improvement, whether thinking how hard to keep the budget on track and actually even get budgets done, to fiscal counties that arent always healthy for the country, to the fact that budgeting in our country is done in a way that is really very separate from any strategic economic thinking you might want to do. So whether its the small technical areas or the biggest, what the objective of a budget, question, theres a lot of improvement that has been in place for quite a number of decade without a really significant overhaul. We have great panel of experts today who are going to lead a discussion about a bunch of different topics, where to look for reforms. Im thrilled to introduce our keynote speaker today, dr. Price, the chairman of the House Budget Committee, who is not only shepherding the budget process along this year, but also doing some really deep and important think about reforms to the budget and what they might look like in terms of process. Im thrilled he joined us today to lead our discussion. Thank you very much. Dr. Price. Thank you. [applause] thank you, thank you. Thank you very much for the opportunity to be with you today and talk about something that is near and dear to everybodys heart, right . Budget reform. How exciting can it get. You know . Probably nothing could be more important and less exciting than budget process reform, so i want to thank all of you for coming out today to discuss and share your ideas. This incredibly important issue as we try to move forward with something that i think has a process right now that clearly is failing not just those participants in the process but failing the country, and that clearly needs to be reform. So its an exciting prospect for all of to us try to shape the way in which budget process reform moves forward. I also want to just commend the panelists who have spent incredible time and toil and labor in trying to assist folks in understand what the budget process is and either why it works or why it doesnt work, and theyve got some, i think, wonderful contributions to make today to this conversation. What id like to do is just kind of lay out where we are right now, what the challenge is, and do so in a way that hopefully highlights the reason for budget process reform, the need for budget process reform, and then talk about some of the things that can be done and split the way forward in terms of policy and process. The budget is most of you know does three things in congress. It sets the 302a number, the discretionary number. The number that the appropriators can spend to on the discretionary side for the next fiscal year. Lays out in the budget tenyear window, the vision for the challenges that we face. Whether its the majority budget or whether its the minority budget or another budget offered. Often times its used as an opportunity to say, this is how we would address the challenges that we face, and then finally, the third thing it does is something that isnt used terribly often but its an incredibly powerful tool and that is the whole issue of reconciliation. Reconciliation is is a process that allow this congress to address spending or revenue or debt in a way that doesnt make a whole lot of difference in the house to the process but in the senate it allows us to move a piece of legislation forward with just a simple majority. Doesnt require a super majority so you can get around the 60vote margin in the senate in a very, very important thing. So, pretty straightforward. Right . Ought to be easy to do. Right . Last year, we passed a budget that balances within a tenyear period of time and agreed to it with the senate, that doesnt raise taxes and gets us on the path for paying off the debt. For the first time in 14 years. First time in 14 years. So if youre keeping track on a score card now, thats one reason the first time in 14 years that we need budget process reform, and well go through some others. But its a red letter date here in congress when we do Something Like that. It ought not be. It ought to be something we do every single year. Folks at home do balance their budget every year, and their businesses they balance and it their communities and places of work or worship to make certain that theyre on track and they correct the course if they arent. For those who are observant of the process youll recognize this was the fifth year straight that the house of representatives passed a budget that balances within a tenyear period of time, routh waying tacks, gets on a path to paying off the debt. So the very cogent and curious among you will say, okay, how much closer are you to balancing the budget, paying off the debt, and getting to getting those programs reformed as we move forward. The answer is, not that much closer, if at all. And the reason that i would suggest to you that were not that much closer is, again, another rope we ought to have budget process reform, because the budget enforcement, the thing that is able to allow to us make certain that the Congress Follows a budget that is adopted, is extremely weak, extreme he week and well talk about the things cat can be done. Thats evidence this is ineffectual process . You all have your long list, im certain, but lets tick through a few of them. The debt, 19 plus trillion dollars in dead. 76 of Gross Domestic Product from debt to gdp ratio, which wouldnt we necessarily that bad if we were moving down, but in fact were moving up. Congressional Budget Office has projected that by the end of that tenyear window, 86 debt to gdp ratio, and continuing to rise. So, were not addressing the challenge of debt. Deficits. We had about 130 billion increase in deficit from last year to this year, about 544 billion that was revised downward a little bit recently by cbo, but stale significant increase from last year. Thats the annual deficit. What gets added to the debt and then increases that 19 trillion number. Growth in the economy. We have seen significant decrease in growth over the last number of years, and the projections arent comfortable for the vast majority of the pub. The average growth rate in our economy has been 3 , 3. 2 . Annualized growth, thats the kind of growth it takes to continue to keep the economy moving and jobs being created in and the like. A projection by the congressional Budget Office now is 2. 1re annualized growth. A 3035 reduction in the rate of growth in our economy. The interest on the debt, were paying 235 billion each year on interest on the 19 trillion in debt, and thats at relatively low interest rates, as you all well know. The projection within a tenyear period of time is that we approach over hundred billion in payment interest on the debt each year, approaching a trillion dollars, a trillion dollars. What difference does all that make . Why do the numbers make any difference . I guess thats another thing id like you to take home and that is that these arent just numbers on a page. These are numbers that affect real lives and real people across our great land. So that every dollar spent in covering the interest costs is a dollar that cant be used to buy a car to pay the rent to buy a house, to send a kid to school, to start a business to expand the business, all the things that the American People say they want are harmed by the fiscal situation that we find ourselves in, that i would suggest is a result partly, if not large part, of the budget process that we have right now. So, thats another reason that its important to move toward budget process reform. The larger picture of governance, the power of the purse and the like, is must be talk about always. Theres a sense across this land that the power of the purse has wands, the executive branch has assumed more and more authority over the past number of years through both republican and democratic administrations. The power of the purse is incredibly important. James madison wrote, this power of the purse may in fact be regarded at the most complete and effect to all weapon with any constitution and rep advertise of the people for obtaining a redress of every grievance and for carrying into effect every just measure. What does that mean sniff the folks close toast the people, the representatives of the people, do not have in their armament, in their quiver, the kind of opportunities to be able to hold the government to account to be able to make certain that the hardearned taxpayer dollars out there arent going for things that the constituents, the citizens dont want, they cant use that power, then its no longer the power of the purse, and consequently i suggest we find ourselves where we are right now. So, what the way forward . From a policy side, to get things at a better fiscal situation, from having the numbers look better on paper, you can basically do three things. You can raise taxes to increase revenue to the federal government. That happens its a pelt project of our friends on the other side of the aisle. Tends to increase revenue to the federal government for a short time and then decreases because it decreases the Economic Activity out there. You can decrease spending, which tends to be what we believe ought to be the most appropriate way to proceed from a tax and spending standpoint, and that helps, but let me suggest to you that this congress has done a pretty dog gone good job of holding Discretionary Spending down over the last five years. In fact were spend only the discretionary side, less right now than in 2008. Thats flat line on total discretion snaer spending between 2008 and now. The total spending occurring at the federal government level is increase because of the mandatory spending, and well talk about that in a minute. The third ways to grow the economy. Is to get that 2. 1 number up to the 3 or more percent number. Every 0. 1 growth in the economy results in a 325 billion flux the deficit. Every 0. 1 increase in growth results in 325 billion reduction in the deficit, which means if we grew at just 3. 1 , it is likely that we would decrease the deficit over the next ten years by over 3 trillion. Thats real money, real money that is staying in peoples pockets as opposed to coming to washington to Fund Programs or to pay the interest on that debt. But let me suggest that the kinds of things i just was talking about are the symptoms of a broader problem and that problem is the process that we utilize to budget and to spend money here in washington. So i want to talk about budget process reform and the specific topic that will be addressed by the panelists here. We budget in this country under the 74 budget act, which was written 42 years ago, written by a lot of folks who were wellmeaning but the effect of the budget act has been in essence to spend more and to grow government, and i would suggest to you that thats no longer the premise upon which we ought to budget. We ought to have a default that spends less and decreases the size of government if we dont do our job. Right now, if congress doesnt do its job, then the spending continues. In fact it increases more and more and more. So, let me talk about let me raise some fundamental questions for budget process reform, and the Budget Committee in the house of representatives is going to be going through a process over the next number of months to come forward with a piece of legislation that will bring about what our goal is, a complete rewrite of the 74 budget act so that we have a default at that time actually spends less and decreases the size of government if congress is unable to or its not possible to get them to do their job. Get us to do our job. What are some fundamental questions we need answer . First, why is the majority of spending unable to be reached . Wespent 3. 8 trillion each year in this nation right now, about twothirds of that is on the mandatory side. Onethird is the discretionary side. Twothirds is the mandatory side. The automatic spending, medicare, medicaid, Social Security, interest on the debt and other mandatory programs. Those are the programs that continue to grow and grow and grow unLess Congress and the president , congress and the administration, are able to reach an agreement about how to reform them. That might not be all bad if it werent for the fact that the majority of those programs are going broke. Medicare, Social Security, other mandatory programs, unsustainable. At home i get this all the time. People say, arent those programs unsustainable . I says yes. Think about what you just said . That means they will not be sustained. Means theyre not going to continue. And so we believe that its irresponsible and reckless not to address these unsustainable programs. So we believe its important to lay out a path for saving and strengthening and securing met compare and medicaid and Social Security. But the budget itself doesnt isnt able to touch those. Thats on the mandatory side of the budget. The number the only thing that is able to be enforced on the budget side is that 302a, that discretionary number. What bet the unauthorized programs . We have a process right now would the majority of nondefense Discretionary Spending in this country, the majority, over 300 billion each year, is unauthorized. That means that the committees in the congress have not said to the appropriators you ought to spend money on this. This is a priority. You ought to spend money on this. In fact they havent done most of them are programs that have lapsed but significant programs, like the state department, for example, an unauthorized department. Cant not appropriate money for the state department, but we ought toed a least make certain that congress is looking at the spending thats going to the state department year after year after year and holding them to account. Thats why the responsibilities of the legislative branch. What role should the executive take in all of this . Big fanfare every year when the president sends the budget up to capitol hill. We kill a lot of trees, chop down a lot of trees to make certain were able to print that budget. And then where does it go . Sits on shelves. Through both republican and democratic administrations the president ial budget that has been put forward over the past number of years has fallen on deaf ears and so what is it that we need out of the executive branch in order to have the legislative branch, the peoples branch, be able to write an appropriate budget . Is it just information or true lay budget . A question i think we need to be asking yours and come to some conclusion on. What are the forcing mechanisms that ought to be put in place to make Certain Congress does our job . Right now theres not any significant penalty for not getting a budget done. We are were living that right now as the see the 302a, the discretionary number, was set with agreement last october and theres not the kind of oomph or inertia to have members of congress believe that getting a budget through is actually consequential. That ought not be from our perspective. We ought to make certain that there ought to be forcing that mechanisms to get the job done. What should the role of the congressional Budget Office be . Are there inherent buyswayses in the office . Many of us believe so. Many of us believe that in so many areas its almost impossible to get to the right answer with the information that the congressional Budget Office gives us. Not because theyre bad folks. Not because theyre illequippedits because in many instances the rules under which they operate almost make so it we cant get to the right answer. So what should the role of the congressional Budget Office be . How often should we budget . A big push to create a biennial budget forker those folks who have been the Congress Since 20010 this ought to shock you since 2010, not a single appropriations bill of the 12 Appropriations Bills supposed to be done annually not a single one has gone through the process of conference between the house and the senate and passed and sent to the president. Not one. Thats 60 opportunities. 60 opportunities to do an appropriations bill and congress has been unable to do so. So should we make that every two years . So that we decrease by half the number of times that we fail . Or should we streamline the process to a greater going allow either more time or more focus on the work that needs to be done . What about the baseline . What should we measure our spending against in should it be current law . Shy it be current policy . Zero baseline, like many states . Should we require the agencies to justify every single dollar they spend every single year . Is that possible . What baseline should we measure again . So often right now we measure against a current law, which means that if you decrease anything, then the increase even owe youre not spending less but you lower the rate of increase, thats considered a cut, which only in washington is that kind of rationale used to describe it as a cut. What should fiscal target bed . Should we adopt fiscal targets . Should we say we can only tax this much . We can only spend this much as a percent of gross domestic snuck what should that ratio be . What kind of fiscal target . A balanced budget . And then finally, the whole issue of a regulatory budget. We have been done a lot of work exploring what we believe is now an important aspect of governance and government rules coming out of washington. The estimate right now is that the regulatory rules that are in place cost the private economy, cost men and women across the country in their jobs and businesses, 1. 8 trillion a year. 1. 8 trillion. Thats six times the amount of the Corporate Income tax revenue that comes into the country. That taught be look at. Thats not looked at by and large by the legislative branch. You have a sense across the country the bureaucratic system the washington is everexpanding and everincreasing and coming out with more and more approvals and regulations. Those are just some questions i think we ought to be asking ourselves as we move through the process. The Budget Committee were going to be holding a number of hearings between now and july 15th when we break for the conventions this summer, and to explore many of these questions. And i hope that you all will take the opportunity to communicate with me as chair, with budget staff, to let them know what you think we ought to be doing from a budget standpoint. This is a great opportunity and i believe a very exciting time be able to put in place positive reforms in the area of budget process, and its a time when both parties ought to be able to join together and do so. Nobody knows who the president s going to. We Everybody Knows and understand the budget processsen working as well as it should, so shouldnt we come to an agreement on what the reforms ought to be that would make so it the process would move much more smoothly and allow to us fulfill our responsibility to our constituents across the great land. So, thanks for allowing me to share a few words, and a few issues and perspectives with you. This morning on budget process reform, and im happy to youre certainly welcome to applaud. Applaud applaud [applause] im happy to take questions. One in front. I think our microphone is coming. Thank you, chair of the Budget Committee. I heard your speech before in theaei on in congress, the house, too some legislation, or local government. A lot of times they just legislation. What i mean is not really working for general public, except as appropriation and thin result to benefit a few. And then currently if you have budget the problem is social issues are there. Nobody touch it. Nobody care about it. So a lot of crime, a lot of abuse, a lot of corruption and waste, and that including on the budget, maybe they have charges all the Many Services and many they have a lot of fraud and transactions, publicprivate partnership, a house, of what, transportation, a lot of problems the people pay but not really the way they receive. Your question . My question is can you really work on the real issues people are suffering and then you can trim those and the budget and you dont have to have legislation budget. Maybe they will cut he budget down. Great point. The concerns the American People they feel dont be dress addressed by congress. The role of the budget economy is not a policy committee and thats one of the challenges we have in trying to get across to folks wire why were having difficulty get thing budget moving forward and difficulty getting the budget getting budget enforce. So that the things we have in our budget are being followed by the authorizing committees. So there are number of authorize committees, ways and manies and educational work force and Natural Resources ore it inees responsible for the kinds of reforms you have identified. The roll of the budget getee is to identify the challenge, identify the problem, and say these are some potential ways that you might be able to address them, gut the Budget Committee is not the committee that puts in place the regs or proposes legislation for the house that then the house or the other committees work upon, but its an important distinction because for many folks they arent quite certain what it is the Budget Committee does. So i appreciate the opportunity to explain that. Yes, sir. One question you had was whether there should be a spending target at all, clawing balanced budget. I was hoping you could expand on that. A lot of the people i talk to thats a nobrainer for them. Yes, it should be a balanced budget. Why is that a question at all . This is incredibly important. We run the gamut in this up to from folks who thinkow dont have to have any spending restraints right now, hence we end up where we are right now over a period of year with 19 trillion in debt. Others who believe that there is a reasonable amount of deficit to carry year to year. The usual number that is provided is less than 3 of Gross Domestic Product, and they say thatsable to by sustained over a period of time. Might actually agree with that if we werent 19 trillion in debt and 76 of debt held by the public compared to gdp or over 100 of Gross Domestic Product in overall total debt, and not moving in the right direction. So, i believe strongly that we need a balanced budget without a doubt. How you get there is the challenge, whats the transition look like . What are the rules in place that enforce that . Those are the kinds of things that i think we need to talk about. But fiscal discipline is absolutely imperative if were to get our house in order. The reason for that is not simply so the numbers line up on page and thats the bottom line that says that money in equals money going out. The reason is when youre not doing that, youre taking away the opportunity from the American People to realize their dreams. The greatest amount of opportunity and the greatest amount of success for the greatest number of folks for the greatest number of American Dreams to be realized in a fair and compassion nat system is what were at. That doesnt work if youre taking a trillion dollars a year ultimately within the a very short period of time pay the interest on the debt. Thats money taken from the American People to do nothing but pay the interest on the debt that has incurred. So i think we must have a balanced budget and i think fiscal targets are appropriate. Thank you marx chairman, im from the university of central florida. Twothirds of all gdp growth comes from federal investments and r d, and so if youre talking about get that 2. 1 or 3. 1 or higher seems like investment in research makes a lot of zillion you can talk about that as part of the budget process and talk about Student Financial aid. If you can talk about how we might be able to address that. These are two areas that ought to be priorities for the nation. I want to see these are the resources we have, and close to the top of the list ought to be money for restarch and development and to allow young people to realize their dream through an education process that works. Sadly, what we do is we get the list of things that we think we ought to spend money on and it just grows and grows and grows and grows and grows and grows and then you get 19 trillion in debt, and again, resulting in a decrease in opportunity and a decrease in discuss and a decrease in the ability for those Young Americans to realize their dreams. Precisely because we have not been willing to make the difficult decisions in this town. So should shows things be a priority . You bet. Without a doubt. Are we making them priority now . A responsible way . I would suggest we are not. And because were not, those spending on those types of projects and so many others are actually threatened because we have got a growing mandatory side, growing automatic spending side. The mandatory spend egg mentioned, which i now twothirds of the entire federal budget in less than ten years will be threequarters. 75 of the spending in this country will be mandatory spending. Thats something nobody has any control over unless we get an administration interested in reforming the programs. So those ought to be priorities but can only be priorities when we have a pool of discretionary moneys that we actually have control over and appropriate responsibly, and i suggest were not doing that now. One more. Youve got some very bright people who are going to weigh in on these in just a moment. Eric watson at bloomberg news. Two of your question points that were intriguing the first one, how to link the budget with into it. Ments. Talking about a 302a4 entitlements and the we is it there a different of creating a cliff, you need a how due you ends force that . And she we could one is how do you force a budget action . Talking about institutionalizing no budget, no pay, and are you wishing you had that this year in order to get your colleagues to go along with your budget . Im looking forward to the hearings we have on these issue but i think that it makes sense to have the mandatory spending, for lack of a better term, on budget. I think its important for the peoples representatives to weigh in annually or some interval to say, yes, the mandatory program, automatic program, is something we think needs to be tipped and in this structure so we hold the agencies to account and make certain that the programs actually work. So many things in our federal government right now where we measure the success of the program by the amount of money going in, not by the output of the program. Theres so many things on the social welfare side where we spend more and more and more money and were not getting the outcome that any of us desire. And so the answer for some of my friend near town is to just spend more money. What that means, were not doing our job holding to account the agencies that are responsible. Then in terms of budget enforcement, a lot of ideas there. One float around is to say if, for example not endorsing this bus its talked be that congress doesnt appropriate the finish their preparations process and a tipping resolution, which is not very responsible way to budget but if a continuing resolution were to be put in place for the next fiscal year or portion thereof, which is simply spending at the rate you spent last year with all of the policies in place, that ought to tick down over a period of time. So there ought to be some increasing pressure on members of congress to actually do their job. I think that is something that makes some sense. Let me thank you again for the opportunity to be with you. Thank you, mya, and kelsy, and i look forward to the discussion, the report on the discussion, and also look forward to your ideas as we move forward in this incredibly important opportunity. Thank you so much. [applause] as we make a transition to our panel, which is going to be led by kelsy from the washington post, there are additional seats. We want to invite people to come in, have a seat you. Dont have to be standing room only and if you really run out of seats, theres a couple more in the fronts. You can take these big comfy ones in the back and panelis will turn around. Dont feel you have to hud huddle in the corner. Thank you. There are other seats over here. If anybody wants to move over. Thank you again to chairman price for doing this, and to all of our panelists. Im going to start out by introducing everybody, and then each one of our panelists will have a few minutes to give a presentation, and then well go to questions. So, to start, we have paul posner, the directoff to the gradat program at George Mason University and also leads the University Center on the public service. His most recent book, the pathway to power, and he is tomorrow early with the dao, and the gao, and Marla Mcginnis from the committee for the responsible budget who brought us here today. Thank you. Miya is an expert in all things budget, tax, and Economic Policy. And she is a political independent who hays worked with many campaigns and candidates and members of congress. We have dr. Stewart butler, senior fellow of economic studies at brookings institution, prior to joining brookings, but her spent 35 years at the Heritage Foundation as the director of the center for policy and advise for the Economic Policy studies. Im sure he is well known to many of you in this room. Then we have dr. Marvin self, the Professor School of Public Policy and Public Administration at the George Washington university. He aims to improve federal budgeting by efficiency, equity and stabilization, and prior to that, until december 2010 he directed the federal Budget Reform Initiative at the Pew Charitable trusts so. Welcome to all of our panelist ands a dr. Price mentioned i am a reporter at the washington post. Cover budget and fiscal policy here in congress. Well begin. Thank you. Thank you all for being here. I think theres one thing that we all can ail degree on, which is the budget process in some way shape or form is broken. We wouldnt be here if we didnt really believe that. I start off all of my lectures with my students and my class on the federal budget saying, unlike Social Security, health care, or food aid, the budget is the one thing that politicians have to do every year. Well, apparently not every year. So, theres an exception right there, showing everything about the budget is the exception to the rule. I think we can tick off a list of things that dont seem to work. The disproportionate attention paid to Discretionary Spending, even though its a declining source. The targets were spending are largely symbolic and dont seem to be adhered to by the rest of congress. And most the budget is offlimits. Walls around mandatory, tax expenditures, and the like, and theres no concerted review available to bring together how all those programs interact in areas such as Higher Education, low income house and all owe the various other programs and policy goal wes care about. We say we have a unified budget but we really have vulcanized budget, and in some ways the 1974 act had a vision that was very different from this. It was of a comprehensive way that congress would tackle priorities, would take them on through the special set of committees they created. It was in some ways an experiment that creating a shadow set of committees could somehow bring the rest of the congress to bay. Well, turns out that probably was the other way around. The Budget Committees are influential by exception, and only the extent to which the leaderships that adopt them as their pet process to effectuate leadership reforms. A lot of wuss like to see that changed to some extent. A lot of us would like to see a budget where we as a nation get periodically enact priorities and changes in priorities and the like. Im going to talk today about about one possible proposal along those lines, recognizing that reformers, experiments are likely to be take 20 years to reach fruition. So i have a nice long gestation period i provided for myself. This process is something we call portfolio budget, and its a product of the work of the National Budget roundtable that myself and miya and Stewart Butler cochair, Monthly Group of budgeteers that meet together and talk about these kinds of issues. Basically the question is, can we somehow give renewed life of the Vision Congress had in 19 74 and we can make hard choices again through some concerted way of looking at our priorities. The notion that this is difficult, particularly for a pollarrized congress, is one of those things we all have to agree on, but the question is, isnt it better to start work on approaches today to do some kind of more rationalized budgeting so that theyre on the shelf and have been tested rather than wait until that fiscal crisis that will could should be take no more action on the bug. On the cb expo ngao and others show the debt will grow to unmanageability proportions in 20 to 30 years, and if you look longer, dont bother. Either produce nightize disbelief. But its a question of, are we doomed to a period of crisis oriented budget or take this and shape it to more social purposes . This process of portfolio budgeting is a paper that Steve Redburn here in the audience and i have been working on. Many other nations do this as an annual process, the oecd, nations locate and netherlands and australia, across the board, have taken on pieces of their budget which they look at synoptically across all the different ago tools they use to enact policy. Sew we look at the question of, could be do Something Like this . These nations have been very successful in taking the processes on and really making real changes that non achieve substantial savings but improve the performance of those areas. And some ways our motto was provided many years ago by the an old budget director, and old and former, david stockman, who once said budgeting should be about focusing on weak claims and not we can climbants and ideally we would like a budget process that could ferret out the programs and others that arent performing and make digses in some ways accordingly. So, basically, the notion of here is that we would take a group like Higher Education, where we have 130 billion of tax and spending programs across many different agencies, and we could look at what collective outcomes are they achieving achn terms of access by studentness Higher Education in terms of states and parents spending on education, and a variety of other outcomes we care about. And we would kind of look collectively at how well the current portfolio programs is working. Whether those programs in some way offset one another as they often do. Whether they are kind of compliment one another, or whether there are some areas that appear to be more effective than others and thats the notion of this. We would take period pieces of the budget periodically. When i say we i mean both the executive branch and the congress to have a special deep dive, if you will, and to look at how were doing as a nation. Now, i understand that among budgeteers we often are fond of ideas and proposals that are often not politically correct. This is probably one of them. Let me give you an argument why these this proposal may in fact be better suited for the times than some of the others. When we take a look at areas like tax expenditures, entitlements, infrastructure, regulatory budgeting, these are broadbased areas of reform that many have proposed valuable and valiant reforms that are often oolympic divers, beautiful and make no splash. Really doomed to fail in some sense in the political way. And they really threaten too many interests because theyre so crosscutting. What we like to think is that portfolio budgeting could tap into those areas that we agree on as a nation. We agree that there should be effective food safety coverage in the United States. We just dont agree there should be 15 programs across many different agencies covering it. We agree that possibly we would prefer to move to some integrated food safety agency, like many other agencies have. We might agree there should be many programs addressing Higher Education can. We dont necessarily agree that some of the programs might do more to enable students to purchase beer than to afford tuition, but the question is, can we, through this portfolio process, do a concerted effort budget reform to really focus and galvanize the Congress Attention on this. One other point and then ill finish here. Recognizing this is not a natural act for congress to do, to bring together a variety of programs under a single raf and for special analysis i would suggest that this is exactly why the Budget Committees xi. They have the crosscutting perspective and the analytic tools with the budget functions and functions we have never fully utilized to bring about such review. Possibly in concert with the authorizing committees. Its been done before. The Budget Committee used to convene task forces in their long life, and 2000 being the most recent. To focus and take dedeep dives on issue. So the Budget Committee could possibly find a new role in the area, acting with other committees to put these issues on the table and have what i call a performancebased reconciliation, where each of these portfolio areas are given a fiscal target that has the possibility of not only being motivated by fiscal goals but by performance goals at the same time. Ultimately yous like to see the executive branch joining in on this and youd have wed all marchm and sing kumbiya together. Well talk more about this im sure as time goes on. Thank you, paul. Miya, youre next. Thank you. So i mentioned a couple of the different fiscal the budget process problem is see at the outset, and thinking about what topic to talk about i cooperate decide because there are so many problems with the budget process. And i think one of the biggest problems that this isnt much of a strategy that goes into the thinking. The budget is not strategy and thats why ion intrigue bid paul and steves work in this area. Another is there are no consequences no Enforcement Mechanisms that are powerful enough. No consequences. As a result the budget now longer taken seriously. And i think everyone can agree the fact that this country is operating without a budget on a regular basis is unacceptable spot to begin with. And clearly the fiscal outcomes are not healthy. We have very few things that put us on a path to fiscal sustainability. We have to leave that to political system. The political system is not at its best these days and it becomes difficult whole budgeting process to lead news the right direction. ll put those aside. Ill talk about budgeting nor longterm and that one of the failures, almost like the political system but our budget cycle is very focused on the short term and i think as a result thats doing a huge disservice to how we invest resources, how we tax, what our objectives are. So our budgets when you have a budget multiple buts the president s budget, the house and senate budget. But you see the numbers for ten yearses but really the focus and what youre doing each year is always on that first year. And that leads to us a lot of outcomes. One is that the big focus in budgeting is the discretionary portion of the budget. The onethird of the budget where the progresses process takes place and we have seen with the sequester in place now, and thats been in place in the past year, focusing on Discretionary Spending is not we need to contemplate halve have programs, revenues. It focuses the smart talent think about the budget on a portion of the budget that isnt as important for the long term Fiscal Health, and that it leaves a lot of the rest of the budget out of the whole process. It also, i think, focuses on shortterm fiscal measures. Theres been a lot of talk coming out of the great recession, the Fiscal Health of the country not as good as it was before. Our debt is now at record levels. Twice where it was before the great recession, twice for historical averages now its 74 or 75 of gdp. Yet we came out of the session with the real concern is what to do to get the economy back on track. The big he had trillion dollar deficits but the biggest problem wasnt shrink the deficits the biggest problem was how to gin up the economy and at the same time put the debt and deficit back on a sustainable path. But because our budget is so shortterm focused we have talk about budget numbers that year, and that i think kind of ended up conflating two different topics, one which is austerity. We have seen that in other countries they have had budget crieses forced on them and they had to take heed and bankrupt mir measures on revenues and spending to get the deficits back down weapon luckily havent had to be in that situation. We havent had markets that despite when we wreak havoc on the world economy, were are seen as the safe haven and that mean wes dont have this time pressure to get controlled of our deficit and debt immediately. We have the luxury of time and can think. Medium and longer term challenges. That means instead of worrying about austerity or cutting programs or spending, raising tacks immediately, that would harm the economy. We nugget medium and longterm planses bus but a our budget dont focus on that, we do the shortterm measures which counterproductive for both the economy and fiscal policy. Also opens up the door for allsorts budget gimmicks all the time. You see people saying, okay, heres all the savings that well have in our budget. Now in the first year were going to actually spend more but cut taxes more. In all the years the savings will come, tax increases will whatever is going to help the debt will be phased in later. The first year well make it easier on ourselves. Be what, the next year they do it again. So its always pushed out Group Something today and the offsets are paid ten years later. So the windows allow for some real gimmicks. I think those people who are thinking about budget process reform should really think about the time horizons, the longer term issues. Theres a bunch of different ways that can be done. Just a couple from maybe easiest to hardest. The first thing is make sure that our budgetary numbers are stretched out. Let me also say i think this issue is even more important now because were in its been going on for a while but as the aging of the babyboomers are happening, as demographics are guiding the budget so much, we really, in the past and now feeling the should have been looking at the promises were making that have longterm consequences in our budget. So intergenerational promises. Pay as you go programs that will get larger when the babyboomers move into retirement. Here we are. The numbers are exploding. We knew that would happen but because we missed that opportunity to get out ahead of that kind of issue. So i think the first thing is, just more. In the budget is such a the budgets are such dense documents, weeding through them, it really matters what you put in summary tables, what information youve provide people. Think whenever public woe should put more longat the term projections. Im sure you love that document as well. When theres new policy proposals i think looking at the longterm effects is very important. Quite regularly when we look at offsets to something, something thats go to pay for a new policy, we end up having saving mechanisms that would be flat or temporary and what you want are the kind policies that will save more over time and grow with time you. Want to have those projections included. Third, we could think about actually having some requirements that dont permit fiscal worsening over the long term. You could put in budget rules about there are some that exist and you could strengthen them, put in more about what youre not allowed to do today that would make the fiscal situation deteriorate over time. Fiscal targets for the long term. Im a big fan of that. Im not so worried bet testify about the deficit this year. Im worried about the debt is headed up indefinitely. Final thought i put out there ive always wondered why we allow ourselves to have a budget that promises more in spending as share of the economy, down the road, than were willing to support today. So if we have promises in our budget that say, spending in the future is going to be 252830 of gdp but only willing to collect in revenues 19 or 20 today were committing future taxpayers, stewart generations to support a budget much larger than were willing to support. I think we should think about ways to align that. Im not swaying whether the government the be bigger or smaller but the notion we shouldnt be able to precommit resources that are so above what were willing to pay today, would be a nice budget limit to put in place. So, my only final point is budget process does seem like a dry arcane topic. There are tons of improvements. The fights on budget process are just as vicious as any other policy fights there are. This is not an easy issue. I think one of the really big goals is dont try to put budget process reforms that stack the stack a Playing Field for one side or the other. Republicans and democrats are going to continue to disaggrieve about tons of different thingses, the size of government then, best measures to get there, their priorities. You dont want a budget process that dictates those outcomes. You really need budget process reforms that both sides will see as fair and that will hopefully make it easier to make these needed improvements. Thank you. Miya. We have shuffled seats a. Bit but i think that the plan was for stewart to go next. Thank you. Thank you. As miya just emphasized, process is important. Rules are important. Rules shape the way the budget happens. As they shape other things and as the chairman said, about roughly twothirds of spending in the United States right now is in the form of mandatory programs, which have very different rules in terms of how they are developed as the rest of the budget. And the Social Security and medicare programs, the major entitlements for the elderly, are now roughly half the entire federal budget itself. Thats really important in terms of its implications. Mean these programs are on auto pilot, whereas major and important programs like defense, like money for the homeless, for students, and so on, are argued over every year and the traditional budget process itself. Meanwhile these other entitlement programs, like the Mighty Mississippi keep rolling on unless there are major changes made in the programs. Paul also mentions the National Budgeting roundtable that we are on, which is an organization that really quicks around ideas on the budget process, and we argue over them. And then some of them are put together in proposals, some of which you have in your documents. And one of the thing thats not yet reached the stage of being published but miya and i are working on them, an idea of the whole area of the entitlement programs this con sift of turning into itment. S or turning them into a real budget, a longterm budget of 2520 to 30 year budget kiss more similar to the way we do discretionary programs in the sense of that this is a real number as opposed to a projection. This idea really has four elements to it. In terms of what would happen. First of all, a congress would enact a 25 to 30 year budget for all the major entitlements, principally Social Security, medicare, medicaid. Simultaneously, it would enact the 25 to 30year budget for tax revenue alongside the spending side. And taxes in a sense or similar to entitlements in that we make changes in the tax code, we guess what the impact will be on revenue, but there isnt a budget per se for the revenue side. So that says both sides of the equation would be included. The third element is that every four years, as there would be a formal reassessment of that longterm budget. Congress would in a formal way reevaluate it, look at it and comparison to what is going on in the economy, what can be sustained, what other major goals there are, and make kind of midcourse corrections to this longterm budget which would give us a real picture. A many cntries dont have the form weve talked about that make as maya mentioned and others look at the longterm budget in general and to think about this a lot more than we do in this country. If we were to do this if you try to put it to place along some budget of this nature dark recent issues that have to be fought very hard about. I just want to mention to you. One is cant pay Congress Really bind congresses way into the future as to what should be spent on medicare or Social Security or other programs . Not in a constitutional sense of the constitution does not allow any congress to do that, to require or to put in super majorities and to force constitutionally the future congresses to stem try. They can produce rules, however, and say and Less Congress were to change these rules this will be the rule in the future. The only way rules can be sustained is for the really to be a broad consensus that they make sense. Part of the reason for including revenue as well as entitlement spending is that both sides of the aisle have a good incentives to see some control, some sense of what these are going to look like waiting the future. The second thing to maybe consider it is, can generally have triggered . Can you in fact effectively keep the budget on track over this many years . I think you can although its not absolutely clear what the best way is to do this. Some people argue there should be automatic changes in programs and in revenue. They may be, for example, automatic changes in tax rates if the revenue fell short of what was in the budget. Or that there might be changes in payment in the medicare program. Somebody in the audience might be thinking that doesnt work too well with the Sustainable Growth rate and the doc fix and so on, but that is one way to do. Another what to do it my to be have an external body that watches over this longterm budget. If it starts to get offtrack in any profound way, that this external body would offer some solutions. These might be subject to an expedited consideration by the congress, a fasttrack up and down process. We have that in place essentially for medical with the socalled ipad ipab. We might come up with an extra body that might come up with a menu of ways of staying on track for longterm budget. And then maybe a supercommittee within the congress itself come and much more powerful version of the Budget Committee whom are from the congressman, the limitations on the current Budget Committee, that some kind of theater strengthened Budget Committee or some combination of the Budget Committee and other leadership individuals to say well, among those options or if you have the outside body being the default option, then the supercommittee might modify that and put into place. But if they didnt, then the outside body default proposal would take president. So there are various ways to do this, to stay on track and in the longterm. Let me just sitting conclusion that when you look at the budget process in the United States, its really hard to think that it is a serious process. First of all if we dont actually pass budgets as you heard the very beginning from the congressman, but it can caa serious budget of roughly twothirds of spending are not really subject to an annual analysis. In one sense is this a budget when only a third of federal spending is really looked at him and he consequently . So i think thats a very important sort aspect of thinking about why we need to move in this direction. And think an account proposal we are developing that we reached a reasonable compromise between assuring certainty to people who are planning for their retirement, the older i get the more important i think this is, in terms of being secure in the future but also recognizing that you cant just have twothirds of the budget essentially out of control given to concerns about the deficit and a deaf special in the future. Thats why we think the debt a longterm, socalled entitlements is a crucial part of the dating a revamped budget act into place that could successfully keep our budget on track and do so realistically within the constraints of the economy, and of our other objectives and goals for our federal budget. Great. Thank you. Last we will turn to a doctor. After that well turn to some questions. I will ask a couple and they will turn to the audience. Maya asked me to talk about lowder, okay. So maya asked me to talk about tax expenditures in the treatment of the budget. I can only begin to Say Something about this by first thinking lynn berman with whom i wrote a piece of years ago i budgeting for tax expenditures. I dont know, lynn has written papers with a lot of people in this room and i know you agree with me that its a wonderful experience. It certainly changed my thinking about tax expenditures. So thanks to lynn. The second thing i wanted to do is thank maya in the committee for setting a five minute rule. You probably dont know that but today there is a five minute rule, and theres a woman standing behind that you cant see but which erases the stop sign, i think i might of us go off. I think thats great idea especially for discussion of budgeting. Because to have a constraint has a nice way of giving incentives to people to make choices that are efficient. And what you make that we all broke the rule . I didnt know that you did it. [laughter] in support of the rule, i actually gave these brief remarks a title, the title that it would be appropriate would be for and have things to remember about tax expenditures and budget reform for the half, in hopes i could get in each one and at least one minute. But you know what tax expenditures are. I mean, they are well known by everyone in this room that they relate to preferential tax treatment afforded some activities relative to a normal tax structure. And by that we include exemptions, exclusions, deductions, credits and solar. I think the rule of thumb, the best way to build what a tax expenditure is, if you dont mind writing it or entering it on the 1040 form, its probably a tax expenditure. The fact now we come to the facts of those things that we dont mind disclosing on our 1040. The first fact is that these are really big. A few dollars here, a few hundred dollars of their, add it all up and pretty soon as someone once famously said, you t to a trillion dollars. So the annual valley of tax expenditures exceeds 1 trillion, which is more than all about 25 of total cash spending, which is more than 5 of the Gross Domestic Product. The value of all Economic Activity in the country. These things are really huge. They are big. The second thing to remember, ma in this is what i trouble with for a long time, they are equivalent to cash spending for almost everything. So almost equivalent. I will save almost until later. But david bradford, deceased economist, made this point i think brilliantly with the proposal he made some years ago. He was proposing to significantly reduce the size of the federal budget. He wanted to really like it, but he did want to reduce services or benefits people got. So we thought how can they do this . What he came up with was the weapons supply tax credit. So under his proposal which he offered suspiciously, dont take this seriously, but what he offered was the department of defense would henceforth not pay cash for its ordinance and equipment. Instead it would just pay suppliers with tax credits. And then you look to see what happens to the budget. Tax collections dropped. Outlays dropped because all that record a lot today about things that are in the off off budget. Taxes and teachers are really off budget. They only show up in a budget in fact as a gross im allocated reduction in revenues. In fact thats exactly bradford support which i guess it is the third thing to remember. They are big, equivalent to cash spending, and the third thing is they are virtually, not quite but virtually invisible in the budget. And the fact is that when we adopt these expenditures, all the shows up we get a reduction in budget outlays. We just grab them, sorry, we could reduction in revenues. Theres no changing anything else and it doesnt look like these things have been a cost, at least to the budget folks, people making budget decisions. In addition we lose we use language to reinforce our attitude towards a tax expenditures. We call them tax cuts. We call them in some cases letting people keep their own money. That suggests to me at least that these things are possible us, that how could it cost something to let people keep their own money . Even jon stuart on the daily show really gets things right and wrong. He was criticizing the president for talking about spending through the tax code and criticizing him to say that, in fact, thats where we raise Money Company up we spend it. Whats wrong with this guy . I think the person had this one exactly right. When i say they are almost invisible, im not neglecting that portion of the analytical perspectives which youve already because its table back there, tax expenditures i program. The joint committee on taxation produces another such table. But that information is not salient to budget makers. Like a lot of other things that weve been talking about today, like of which kind of costs are really controllable in the budget right now with respect to entitlements or with respect to longterm spending, that they, in fact, are missing in action. Its very easy to ignore the existence of those spending equivalents that are large in the budget. So what . So what if they are distorted . If we were all perfectly rational, you know, economic man, economic woman, economic person, it really wouldnt matter where those numbers were. If they were on the front page for talking analytical perspectives, rational decisionmakers would ferret them out, find that information and use it in their decisions. That humans are not like that. We dont work that way. An example thats oops, my time is almost a. Theres a common example that many of us have encountered in real life. Volunteer firefighters. They are not paid and theyre happy with it. They have these tshirts that many of them where the sick pride not cash. Were doing this to discharge her civic responsibility. Occasionally a tangible propose to pay them for their expenses. Very hard to get that through especially in this day and age when budgets are stressed. If you propose to pay them you can be sure youre not going to get that through a legislative body. But if you propose to just do come even they dont have the money, if you just change the proposal slightly to say we are not going to pay them cash but will give them the equivalent in tax abatement, even for personal property, real property. You have a much better chance of getting that through. So the point im trying to make here is that if information is not salient, is not present, is not on the table when youre making budget decisions, does it matter if it exists. Whatever it is, if its not present, if its not salient it is probably not going to be taken into account. It adds to fiscal illusion. We end up with inefficient choices, probably a lease in the article that we wrote, the bias goes this way. With tax expenditures being not salient you have a bias toward cash spending, you also have a bias towards total spending in the model and the push of a biased in favor of doing things to tax expenditures. The bigger point about the treatment of tax expenditures in the budget is that the way numbers are presented, the way information is communicated to decisionmakers matters for decisions. We are not all calculating fully rational individuals who get every bit of relevant information. It has to be easy to make better decisions. And that rule is one that i think a has application to the control of entitlement spending as well as tax expenditures. So thats four points. They are big, equipment has been become invisible in the budget, distort decisions. I guess the half is it doesnt have to be that way. The way we do budget accounting, the way we put the budget together, not written in exodus or deuteronomy or probably chances only one in five its in the leviticus. We made it up to support a functional purpose. And if it is not providing us with information that we need to make better decisions easier, then we should start thinking about changing it. Thomas sole says something often in writing that makes a lot of sense to me. He says there are no solutions, just trade off. For every difficult position. Thats clearly the case here. So what we offer is not really, we do discover as the solution. Probably isnt at least a lease in this case it seems to me that the tradeoffs appear favorable enough that we ought to reconsider how we treat cash expenditures in the budget. Thank you. We have about 15 minutes to do questions. Actually i wanted to start with the political question. So in this Political Climate where we have just on friday missed the statutory deadline for passing a budget, i want to open this up to the whole panel. Is it realistic at this point to be having a conversation about total reform of the budget process . Or is the reason to think that our small incremental things that could be done now to improve the outcomes that we see . Im one who believes having been at gao for many years i always counseled my people. Just because someone didnt act on your report this week with this your destiny that its not going to have a lot of shelflife, and then three or four years later when the time is right in the window of opportunity opens thats when these ideas come to fruition. Some ways this is a good time but we know the political leaders are in a supply chain looking to enrich the field of ideas knowing that maybe three, four years down the road thats when the window will open, whether because of a crisis or a political revolution, who knows . But i think its an come upon us as much reformers today that supply chain now. Jim, i cant believe youre leaving without a question. We will all get along email with his thoughts later. I think it doesnt make a whole lot of sense to incremental reforms in less released have a vision of which are bigger comprehensive form should look like and we want to go. Otherwise you can start making incremental reforms to put you in the wrong direction. Nothing can get done right now so its really kind of a huge undertaking, we will reduce the entire 1974 budget act. I think we develop what it should look like, and budget process that lays out a strategy that includes fiscal goals as more evaluation and analysis of whats working and whats not and will the curt leduc, that is consequences if you dont act, sorted whole roadmap of what it should look like. Perhaps that is the bigger broader change but you can released into the changes, but the consequences are of not acting. That would be put in place for the moment and move in the right direction. Can i ask a followup . How do you develop a broader strategy, that broader plan in Political Climate we have house members up for reelection every two years in the moment they are elected, they returned to the process of becoming i think its to all policy issues which is want as much as what we need is not process reform so much as policy reform. We need to overhaul what our current budget blueprint is about policies in place that are sustainable. Thats much trickier. Anybody who taught you something responsible tends to get published proposing that during the campaign. Processes of technical and so divorced peoples normal lives that may be an opportunity for people to Work Together on the hill and actually, india were very little is getting done. Polling experts and start thinking about what reforms, a Major Overhaul could look like. I think maya nailed it. I agree, maya nailed it, that one way of describing what maya said is a guest of yogi berra, if you dont know where youre going you may end up someplace else. Its important to have a sense of where you want to go. I think as i said this is an important very to debate and discuss with a broad terms. Thats why the idea of a third your budget is so important. To get people thinking differently about entitlements. I think its very important. I think also at this point its important to get the large constituencies who are affected by any change sorted into the room together in saying look, we understand your needs and desires and your fears about how changes might affect you. Lets start having a conversation about how we maximize your hopes and minimize your fears in such a way that the country as a whole and the Budget System is most effective. Theres an Organization Called convergence that right now is beginning to assemble those groups to have that kind of conversation. Most of us at the table been involved in that. This is a period in a sense because you know you cant get something fundamentally done. It actually does focus the mind to say lets get back to basics and think through what would you have to do to prepare the grounds so that when things are aligned, and the politics are right youve got something already thought through, the constituencies talk about all these things, arp has got to be brought in to talk about a longterm budget and things like that. I think its a great opportunity actually for beginning to have this conversation. I will ask one more question. I wanted to draw a three between a couple of things that came up. We talked about the longterm budgeting your we talk about looking further out into the future but that chairman brought up the concern with what referred to as institutional biases at cbo. His point is about dynamic scoring. My question is how to address both of those concerned, and had to keep the confidence level among all members and the number said they are seeing . I think the criticisms you both sides of the aisle is theres a lack of faith in the model that exists right now and its ability to correctly predict how we will spend money and bought a budget should actually achieved over time. Yeah. I mean, theres always going to be criticism of whatever model you use, whatever approach. I think that goes with the territory with regard to cbo. One possible solution might be for cbo to acknowledge that there are perhaps some alternatives, alternative models that are good enough. I mean come meet the test of reasonableness that the projections of those models ought to be published alongside cbos most confident assessment of what things look like. That would essentially mean that for cbos role is not like the final arbiter, but is the high priest with some of the priests. And that might be a way of defusing this in such a way that you keep solid proposal, solid models being used but allow some variation, some room for maneuver. That might be a way to deal with this. To say anymore about that. I think cbo does a great job within the confines of what they had to work with. We need to change those confines, would be my judgment, but i dont have any more. So not knowing exactly what dr. Price was referring to i think it couldve been two things. The dynamics would you bring up and also the fact theres a sense that baselines dont treat them in a parallel way and always. I think if you want to look at those and you want to again back to my place the budget process only works both sides, you like the outcomes are not prebaked into the rubric when it comes to dynamic scoring this is a tough one because i think theres no question you need some kind of analysis that shows the growth effects of the different policies you would be picking. Theres no question we dont have to do it yet. We dont know how to make those projections. I think we should be looking at parallel estimates we could make a lot of sense. You hav have a traditional statc essence also include dynamic estimates. That was on the revenue side and the spending side and a good your question which is the public investments are one of the bigger drivers of Economic Growth in this country, and yet with a budget that favors consumption aggressively by 84 , 16 of public investment. This is not a recipe for growth. If you look at the growth effects of different kinds of tax reforms and Spending Priorities at least inform our decisions i think would help us pick more progrowth and sustainable policies on both sides. I would say i think budgeting has gotten more difficult since cbo was formed. Were focusing more and the longterm. Budgeting as most were integrated so the question cbo has to take on as much with difficulty i think they are in my view, a political miracle that such an agency has been up to withstand the crucible of politics like them and keep it on the analytic integrity i that be the model for International Organizations throughout the world that increasingly adopting cbo. I thinthe challenge really is how can we create analytic tools but without having to become decision rules . Went analytic tools become decision rules, the pressure on Catholic Agency for political leaders alike becomes very, very difficult and thats where youre really on your money as an analyst trying to kind of sustained kind of an approach where youre presenting multiple options and really letting the political leaders make those decisions. Thats where they belong. Forcing those decisions to be made by an Analytical Agency and having them mechanically be translated into budget figures to me as a real risky path. Lets open up for a couple of questions. If you could introduce yourself. Start over here and let us know that you would like to answer the question. Charlie clarke, government executive. Anyone can answer. Hunters wanting her intelligence other democrats on the hill. I know said the agency is doing budget Reform Research and proposals. Widgets are from chairman price. Is there any sympathy from the minority ranking members . We just heard from chairman price. As far as i know theres a sympathy. I dont know theres necessarily anything agreement on what direction to head. I dont think any of the discussions have been public enough that we have a sense where people are going. I think their sympathy from every person that the process needs to be improved. The agreement may stop there but my guess is they will find some areas where theyre able to Work Together. I compared this to tax reform and that its one of those things everybody agrees needs to be done but the goals for both sides are a little bit differe different. Back there. Thank you. My name is tom. I live here in the district, taxpayer and subscriber to the washington post. I thought simpsonbowles was one of a marvelous piece of work, and i think maya enter committee had a lot to do with it. My question is, back to what paul posner said, is its good to have some ideas in the supply line. Is a simpsonbowles or some suggestion such as simpsonbowles still a viable approach . What would it take to get that dusted off and moved ahead . Would that be help in that regard . I can speak to you but we think a lot about that, which was also sure you believe that simpsonbowles was just a tremendous blueprint that showed how the company to deal that actually respected the objectives of growing the economy and protecting affordable and getting at a sustainable fiscal place in a way that would not derail the recovery was an incredible opportunity. There were a lot of people who believe that and i think its sort of reflects how broken government is that we were not able to them of Something Like that forward. I think theres always an opportunity to go back to look at those policies. The solutions have not changed very much. We do we have to look at all parts of the budget. We know we need to raise revenues from reforming the tax code in a way that would help grow the economy, that health care costly to be controlled, we need to do something to the Social Security back on a sustainable path. One thing that you think is it me prove and this is just i think the debt issue demonstrates how broken government is right now. It may prove to be easy to do this in pieces, and what i mean by that is you could imagine sort of breaking, fixing our budget into a number of pieces but the first one would be stop digging. What we did last year is where the budget in place that was supposed to save by trillion dollars but we did is we added another trillion dollars to the debt. Stop making its worst. Thats the first piece. We know we need is something that Social Security to the tobacco longterm health. We know we need to fix health care, a taxi for. That something getting a lot of attention right now. I think we strongly need to reassess our budgeting priorities, how our resource, how our resources are spent and look at consumption versus investment and look at the fact we spend 6 on the elderly for everyone we spent on children and is the right ratio . The final piece would be what were talking about today, budget process. I think the best thing would be lets do it all at once and lets fix this problem for this country. They were to put ourselves unsustainable fiscal path it would open up so many economic opportunities. Can be so much bette