According to reports, one of the first acts of the Republican congress will be to fire Doug Elmendorf, current director of the non-partisan Congressional Budget Office, because he won't use “dynamic scoring” for his economic projections.
Dynamic scoring is the magical-mystery math Republicans have been pushing since they came up with supply-side “trickle-down” economics.
It's based on the belief that cutting taxes unleashes economic growth and thereby produces additional government revenue. Supposedly the added revenue more than makes up for what's lost when Congress hands out the tax cuts.
Dynamic scoring would make it easier to enact tax cuts for the wealthy and corporations, because the tax cuts wouldn't look as if they increased the budget deficit.
Incoming House Ways and Means Chairman Paul Ryan (R-Wis.)calls it “reality-based scoring,” but it's actually magical scoring – which is why Elmendorf, as well as all previous CBO directors have rejected it.
Few economic theories have been as thoroughly tested in the real world as supply-side economics, and so notoriously failed.
Ronald Reagan cut the top income tax rate from 70 percent to 28 percent and ended up nearly doubling the national debt. His first budget director, David Stockman, later confessed he dealt with embarrassing questions about future deficits with “magic asterisks” in the budgets submitted to Congress. The Congressional Budget Office didn't buy them.
George W. Bush inherited a budget surplus from Bill Clinton but then slashed taxes, mostly on the rich. The CBO found that the Bush tax cuts reduced revenues by $3 trillion.
Yet Republicans don't want to admit supply-side economics is hokum. As a result, they've never had much love for the truth-tellers at the Congressional Budget Office.
In 2011, when briefly leading the race for the Republican presidential nomination, Newt Gingrich called the CBO “a reactionary socialist institution which does not believe in economic growth, does not believe in innovation and does not believe in data that has not been internally generated.”
