Think Tanks Do Journalism: Obama Admin's 'Budget Baseline' Incorporates Previously 'Temporary' Items

Two think tanks, the Tax Policy Center and the Committee for a Responsible Federal Budget (CRFB), have done something the New York Times, the Associated Press, and other supposed leading lights of establishment media journalism should have done days ago.

As described in a Wall Street Journal editorial today, those two organizations have caught the Obama administration playing with the federal budget numbers, specifically the "baseline." The editorial also makes two important points in its two final paragraphs (bolded by me):

... the White House is proposing to convert spending sold as a one-time economic boost into a permanent feature of future government growth. As both the Tax Policy Center and the Committee for a Responsible Federal Budget have pointed out, supposedly temporary parts of the stimulus—expansions of the earned income tax credit, the child tax credit and Pell Grants for college students—have now found their way into the budget baseline.

True to the way Mr. Obama has honored his campaign pledge of transparency, this news was buried in a footnote on page 170 of the budget's Analytical Perspectives.

The baseline normally reflects "current law," but the White House argues that this is unrealistic because Congress is never going to allow, say, the Alternative Minimum Tax to hit the middle class. Fair enough. But it also chose to smuggle these stimulus items into its definition of the "current policy" baseline and hoped that no one would notice.

The Responsible Federal Budget folks estimate that this fiscal sleight-of-hand would cost about $266 billion over 10 years, which by itself almost cancels out the White House's spending freeze.

... Mr. Obama likes to pretend that he is the victim of a budget hit-and-run, as if the projected $1.3 trillion deficit in 2011 is all the fault of his predecessor. But President Bush didn't force the White House to request 1.8% of GDP more in new spending in 2011 than it did in 2010. Nor did Mr. Bush force the White House to assume that the stimulus transfer payments it created will be paid out into perpetuity.

What these budget details really show is that the stimulus was always more about promoting liberal policies than spurring economic recovery—which is why so many Americans are so angry.

The Tax Policy Center's TaxVox Blog explains what happened with two particular tax items:

The CRFB's blog paints the bigger picture, showing that the administration wants us to believe that if the government operates on autopilot -- with no new congressional action of any kind -- the 10-year federal deficit projection is over $10 trillion, when the reality is (based on the assumption used) that it's barely half of that:

What's really "transparent" about all of this is its motivation, which is to dishonestly move the goal posts. If future deficits come in below $1 trillion or so, the administration can claim that it achieved deficit reduction compared to what had previously been expected. But the Obamabots have stuffed what's "expected" with items that don't yet have any legislative authorization. It's the vaporware of government budgeting.

The average person wouldn't know any of this unless he or she were possessed of unlimited time and the ability to independently pore through hundreds of pages of documents (which would make then that person anything but average). Fortunately in this case, a couple of policy advocacy groups did it for us. Clearly, if you waited for the establishment press to find this, we would never have learned of it. A search on the word "baseline" at the Associated Press returns 32 items -- all about sports. The best the New York Times can do at its Economix Blog is a link at "What We're Reading" (i.e., "What We're Not Reporting") to a post called "Still Budgeting through Footnotes FY 2011" -- found at CRFB.

How many other budget tricks are being missed because the watchdogs can't be everywhere at once?

I suggest that the WSJ editorial page (which during Democratic administrations morphs into a de facto source of news the establishment press, including all too often the Journal's own writers, won't touch), the Tax Policy Center, and the Committee for a Responsible Federal Budget send the wire services and the supposed newspapers of record a symbolic bill for "journalism rendered." The recipients may not have the money to pay a real bill.

Cross-posted at BizzyBlog.com.