Lawmakers Battle Over Budget Outlooks

WASHINGTON – As lawmakers prepare to take up budget resolutions (search) for the fiscal year that starts in October, partisans are already bickering over whether a Republican-backed five-year budget outlook plays politics with the nation's finances or more accurately estimates future ledgers.

"We've always done a 10-year budget because it gives you a much better picture of what's to come than just the five-year. We think it just makes sense to give yourself the best picture you can of what's ahead," said Chuck Fant, whose boss is the ranking Democrat on the House Budget Committee (search), Rep. John Spratt of South Carolina.

"I don’t think the Democrats have a lot of standing when it comes to writing a budget," said Sean Spicer, spokesman for the Republicans on the House Budget Committee, who added that Republicans are historically more fiscally responsible.

Although 10-year horizons are more common, politics often dictate the length of budget windows. In 1995, congressional Republicans chose a seven-year time period so that it would coincide with when they expected to have a balanced budget. In 2001, when the economy was booming and a surplus was projected for years to come, the 10-year forecast allowed lawmakers to give a rosy scenario that lasted a decade long.

But with Washington currently racking up record deficits, GOP lawmakers say a 10-year forecast — agreed to by lawmakers last year after a contentious debate — is too unpredictable.

Spratt and fellow Democrats, on the other hand, insist that the 10-year outlook provides lawmakers with a lot of valuable information, and add that cutting down the forecast to five years masks the effects of GOP-jiggered fiscal policy.

The nonpartisan Congressional Budget Office (search) predicts that while the deficit picture will improve in the next five years, in years six through 10, it will get worse. CBO, however, acknowledged in an April 2003 report that its calculations beyond six years are difficult to make with real certainty because its forecasts are based on a static model of spending and tax policy.

Still, Fant suggested that the GOP could be opting to promote a five-year outlook "to hide some of the costs that you don’t really see in the first five years or drains on the revenue caused by tax cuts."

With the economic numbers 10 years out not looking so hot, the GOP has plenty of reasons to limit the length of its outlook, said Heritage Foundation (search) budget expert Brian Riedl.

"Lawmakers are concerned about not being able to write a budget that balances in 10 years, and it is easier to write a budget in that situation for five years," Riedl said.

Steve Ellis, vice president of programs for Taxpayers for Common Sense (search), said that in either case, the budget outlook offers no absolutes and real economic advantages can be found in both short- and long-term forecasts.

"No matter what window you pick, there's going to be some gaming of the system," Ellis said.

"The further out you go, the more sketchy your data is going to become, the less reliable it is. But, if you artificially shorten the budget horizon, you ignore certain data from being counted in the equation. The longer the window you're looking at, even though the less accurate it is, the more info you have to look at and to go on when making these decisions," he said.

Ellis said his organization prefers to look at the bigger picture, saying that though the information is less reliable, long-term decisions need to have long-term data behind it.

In any case, no one really denies that changing the length of the budget forecast has political consequences.

"Is it a political calculation? Everything in this town is a political calculation, but we are writing a responsible five-year budget," Spicer said.

"Is keeping it at a 10-year window a political effort by the Democrats to force the deficit picture more on the screen? I think that’s true," Ellis said. "Who wants which time period has typically been looked at as who gets a leg up on the issues."