Director keith hall testified before the House Budget Committee tuesday about his agencys history, organizational structure, and responsibilities. He also answered questions from republicans about their attempts to repeal the Affordable Care act last year. It is 10 00. Good morning, everyone. The hearing will come to order. Welcome to the committee on the butts hearing on oversight of the Congressional Budget Office. This hearing will focus on cboest organizational and operational structure. It is the first of five hearings that the Committee Plans to hold regarding oversight of the congressional budget. The goal of todays hearing is to learn more about cbo, which was created as part of the congressional budget and impoundment act of 1974. For decades, this agencys primary duty and function has to assist congress in the federal budget making process by providing cost estimates, economic analysis, working pain ersz and other in sight you will publications. Members of the house and senate Budget Committees rely on cbo as an objective, impartial resource when writing budget resolutions. The agency also plays a key role in advising this committee as it enforces budget rules. Without question, there are dozens of fine men and women employed by cbo, including analyst sz, management and support staff. But more than 40 years since its founding, congress has not undertaken a comprehensive review of cbo structure and processes. In fact, cbo still operates under its original primitive authorization. I say this not to raise alarm about the future of cbo or question congresss need for it. Its simply a fact that serious oversight has not been exercised to ensure the agency still has the tools it needs to be successful in fulfilling its mandate. That being said, our intention is the same with todays hearing as it will be with upcoming hearings. We want to better understand how cbo carries out nonpartisan mission and support to congress. During todays hearing, we will take a closer look at the organizational and operational structure of cbo, including its staffing, assumptions, processes, and work products. To provide an overview on the inner workings of this congressional support agency and how it has evolved over the yeerks im pleased to welcome dr. Keith hall. Dr. Hall has served as director of cbo since 2015 when he became the ninth director of the agency. Before we hear directly from doctor hall, i want to stress this series of hearings is not to be partisan or invite cheap shots against the agency to budget independently. However, there are legitimate questions about how cbo operates and im hopeful that these hearings will shed light on how we can improve its operations to previ provide congress what it needs in the 21st century. To ensure cbo can efficiently carry out its mission, im pleased we are advancing a comprehensive review through these oversight hearings. And i look forward to productive conversations today with dr. Hall. Now, before i yield to my colleague h the Budget Committees Ranking Member mr. Yarmuth, youll remind everyone this committee will strictly enforce the five minute rule. Im a military guy. I like to run a tight ship. And i want to ensure that our hearings are as productive as possible. So ill ask that your remarks and your questions are delivered with enough time for our witness to respond. If they are not, answers will be submitted for the record and ill hold my colleagues and myself to this rule. So thanks in advance. I look forward to a productive hearing. And now would like to yield to the Ranking Member mr. Yarmuth the great commonwealth of kentucky for his remarks. Thank you. Gracious congratulations on your new rule. All of us on gt Budget Committee take our role seriously and im glad well be discussing these important issues today. I hope that we will be just as diligent in our responsibilities to develop a Budget Proposal and will hear testimony from the federal agencies that we expect to be significantly impacted by the president s budget. Director hall, thank you for your testimony in advance, and thank you for your service. Congress created a Congressional Budget Office to give us an independent and reliable source of budgetary information and expertise. For more than 40 years, cobb has fulfilled its mission, providing impartial, high catalina analysis to inform our Decision Making and improve our ability to protect the power of the purse. While everyone here is aware that director hall was appointed by congressional republicans, expectations have always been that the cbo director will carry out his or her responsibilities without a league gans or deference to any political ideology or party. Same is true of the staff who are hired based on their ability and qualifications. Not political affiliation. As a result, cbo produces its best analysis regardless of any desired outcome for an administration, majority in congress, or the congressional minority. Despite that commitment to object jek tift, however, cobb has been the target of criticism. And im sure we will hear some of that today. Youve actually heard some of it from me over the years. Director hall, i do not envy you. You have what i argue is one of the thank less jobs in washington. And that is to be our objective referee. Coming from a basketball state, i know how loved the referees are. In arena where passions call deep, your calls will often be embraced by one side by questioned by the oefrmt one day its the republicans complaining, next its democrats. Thats been a reality in Congress Since cbo inception. But there has been a dramatic shift recently in the treatment of cbo. And as members of the committee this should be deeply troubling to us all. Questioning and fair criticism of cbo have morphed into more caustic attacks, many have crossed the line. And much of this friction seems to colleagues efforts to repeal the Affordable Care act. Look, i get it. I would not want to defend increasing number of uninsured americans by 20 million or causing premiums to sky rocket particularly when there is no viable plan for replacement. But im not sure what you thought cbo analysis would show. Affordable care act expanded coverage through 3 related strategies, Insurance Coverage available to all, requiring individuals to get covered, and subsidizing premiums to make coverage affordable. If you end the individual mandate, which we have just done, people will go without coverage. If you ends subsidies that help families afford insurance, people lose coverage. If you takeaway Consumer Protections and once again allow enshuners to play gain, premiums increase for everyone not in Perfect Health and people lose coverage. No way around the fact that repealing the forktd wiaffordab act will result in millions losing coverage and no way to defend that to the American People. So with no where to turn, many of my republican colleagues unfairly went after the cbo. Inappropriately impugning the integrity of the agency and the staff. I want to be clear, i think congress has ever right, even a duty to review cbo work and ask questions. And cbo needs to be forthcoming in providing explanations. Democrats have certainly raised questions about assumptions or interpretations. But what we havent done is called into question the integrity of the institution or individual staff members. Its all too easy these days to take refuge and information that tells us only what we want to here. But that does not lead to sound policy. Cbo does not exist to give us the information we want to hear. Its job is to give us the information we need to make informed responsible decisions. So someone of the few institutions in washington that serves that role. Tax on cbo is not attacks on staff, but as deliberative body. Reduce government and undermine the standards under which a functioning democracy depends. Today i hope to hear from you dr. Hall how you ensure your work is objective and transparency at cbo. Id like to learn more about your staff and any need for additional funding or tools. Youll likely hear from us disagreements with some of your methodologies. I think some will challenge you in the process and enyour age you to look at alternatives methods. I think thats fair game. And look forward to that discussion. Thank you for your leadership at cbo and for your testimony today. I yield back. Thank you. In the interests of time if any other members have opening statements, i would ask that they be submitted for the record. Id like to now introduce and recognize director of the Congressional Budget Office, dr. Keith hall. Dr. Hall thank you for your time today. Let me say how enjoyable it was yesterday to visit the fourth floor of the Ford Building and the great staff work thats taking place over there with the Congressional Budget Office under your leadership. The committee has received your written statement. And it will be made part of the formal hearing record. You have ten minutes to deliver your oral remarks. And the floor is yours. Thank you, sir. Chairman, womack, thank you for inviting me to testify. And thank you for your support and guidance. We at cbo have long relied on the Budget Committees to explain our roles to others in congress. We also rely on you to provide constructive feedback and guidance on kojs priorities. The work on your part has been key to our success over the years. I would like to make ten points in my remarks and look forward to talking to you how we can serve congress better. First, stronger role in budget matters. Cbo wags established under the congressional budget act of 1974 that would support the budget process. Cbo mission is to help the Congress Make effective budget and economic policy. In carrying out that mission the Agency Offers alternative to the information provided by the office of management and budget and executive branch. Second, the Congress Sets cbos priorities. Cbo follows processes specified in statute or developed by the agency in concert with the Budget Committees and congressional leadership. Cbos chief responsibility is to help with matters under their jurisdiction. Also supports other committees particularly the appropriations, ways and means and finance committees and leadership. Among cbo statutory rirmtds is producing certain reports the best known of which is the annual budget and Economic Outlook that reports includes cbo baseline budgetary and economic projections. Cbo is also required by law to produce a formal cost estimate for nearly every bill that is approved by a full committee of either house or senate. Those cost estimates are only advisory. They can but do not have to be used to enforce budget rules or targets. Moreover, cbo does not enforce rules. The Budget Committees do. Third, cbo produces a lot of work each year. For example, last year they 440 cost estimates. Gave help to staff. And published many reports about the budget, the economy and related issues. Nevertheless, because of limited resource, the number of estimates and an analyses that cbo can produce fall short of congressional requests. Moreover, we must balance our commitment to responds to the congress to release estimates and analysis only when their quality is high enough. Fourth, in order to provide congress with the high quality analysis that it needs, cbo staff has expertise in many areas. Among cbo roughly 235 people, the largest concentration of expertise is in the area of health. Other areas of focus including national security. Labor. Taxes. Energy. And macro economics. Maintaining a broader array of expertise allows cbo to respond to policy makers needs quickly. Analysts are organized into number of divisions but requires work for more than one division. Cobb analysts also pursue high quality accuracy. Ta approach issues with detailed funding of the programs and tax code. Carefully read the Relevant Research literature. They painstakingly analyze literature from the government. And diverse range of outside experts, representatives of industry groups, other private sector experts and Government Employees at the federal and state levels. Some of the consultations occur during periodic meetings. Fifth, cbo analysis is objective and nonpartisan. Mainta maintain this in many ways. Another is we hire people on the basis of expertise. Nearly 80 of cbos employees have advanced degrees. And without regard to political affiliation. We carefully consider whether potential analysis can perform objective analysis regardless of their own personal views and enforce strict rules from having conflict of interest and limit political activities. Experts views as you present the likely consequences of proposals being considered by the congress. Our estimates are inherently uncertain but our goal is to produce estimates through the middle of the distribution of possible outcomes. Sixth, models do not produce cbo estimates. Cbo does. Cbo estimates often require projections of how people in institutions would respond to pro decembered changes in law. Computer model is one tool that they may use to make such a projection. Various kinds of models, complex, and regression, and calculations in spread sheets. Cbo models are constantly being improved. They cannot show the full effect. Analysts must routinely go further with other information until the estimates correspond as closely as possible to what the best research suggests. Seven cbo has rigorous system of checks and balances. All reports reviewed internally, that involves many people in the agency. Experts help them hear all perspectives on issue. Continually revisit our past work and between our projections and actual outcomes. Also compare our analysis to others work and incorporate outside feedback into our projects. Eighth, they priority toois transparency. Many approaches to be transparent. To begin with, cbo cost estimates a estimates and publications. Including our projections about the committee, spending, revenues, and Health Insurance s subsidies. Key parameters. And seek external review of our reports before released and methods in which our products are based. Cobb also promotes transparency. When cbo kpleetsds a formal cost estimate immediately made available to all congress, their staff and public on cbo website. Furthermore, they regularly explain their analysis to staff. For instance earlier this month in collaboration with the research service, my colleagues gave presentation to 150 Congressional Staff members about how cbo insurance costs and coverage. Unfortunately the pace of action limits the Time Available for providing extensive explanation of estimates. And because the over all demand for cbo work is high t and resources are contained, we need to balance requests for new analysis. And with our other responsibilities such as regularly updating baseline projections. Ninth, we evolve as needs evolve. True to original mission, we work with congresses not envisioned when the agency was first created. For example, as legislation has grown more complex, we found ourselves spending more time preliminary analysis and Technical Assistance during the drafting stage. And being asked more often to prepare cost estimates for bills heading to votes marked up by committees first. To accommodate the needs, cbo shifts and develops new analytical tools. We significant resources to identify health care issues. Similarly, improved our ability to study how legislative proposals would effect the economy and thus the budget as congress desire for dynamic analysis intensifies. Tenth, cbo is always looking for ways to do things better. Reviewing every aspects of our simulation model of heekt Insurance Coverage. In addition, we will further improve our capability to perform dynamic analysis as well as how it effects the budget. Responsiveness and transparency Top Priorities of mine. And cbo has plans to bolster them further. We will increase the public documentation of our computer models. We will also do more to explain how athey do this. This will depend partly if we have received the funding. As always, we look for ways to serve you better. I look forward tour suggestions. Look forward to the questions. The chair expects to be here for the entire did your aches of the hearing. And as such im going to defer my time until later in the sequence of the q a. Soy so ill be yielding first to our members who i know are on the tough time clock because of the things crammed into one day. So ill withhold my questions at the present moment and use those as we cleanup the hearing at the end. Now i yield to my friend the Ranking Member from kentucky. Thank you, i intend to do the same thing. Ill sit until the bitter end with you. Thanks. The first round of questions go to my friend from oklahoma. Mr. Cole. Thank you, mr. Chairman. I want to begin by thanking you for the hearing. I know its important for us to do. I begin by thanking you dr. Hall, and your staff. Ive dealt with a lot and with the staff and its been professional and courteous no matter who was at the head of it. I think you have a fine agency. I dont always agree, but never had any difficulty getting the explanations and the judgments, and thats fair enough. I do want to ask a couple of things. And my good friend from kentucky talked about the Affordable Care act analysis. And there is one area that i want to ask about. And its sort of down in the weeds. And then i want to build on that and ask you how you come to assumptions and models and what kind of input, if any, congress has as you build your predictions on a series of assumptions and models. As i recall, and i think ive mentioned this to you before whether you were kind enough to come b