The New York Times has an editorial criticizing switching to the chained CPI for Social Security cost-of-living adjustments (COLAs). Recall that the chained CPI is widely regarded as a more accurate measure of inflation because it better accounts for consumer substitution between different categories of related goods as relative prices rise or fall. As a technical matter, the chained CPI is the best available price index for accomplishing the goal in many spending programs and in the tax code of accurately accounting for inflation in determining various benefits.

The NYT's arguments are flawed for a number of reasons. Their main arguments against the chained CPI are:

• Deficit reduction should be held off until the economy has fully recovered.
• Social Security is not driving the deficit. It will not be able to pay full benefits in 20 years, but that is a separate issue which should not be dealt with in the context of deficit reduction.
• The chained CPI may be a more accurate measure of inflation for the working age population but it is not for the elderly population. Instead, the Bureau of Labor Statistics should develop a retiree-specific price index.

On the first point, the issue of when deficit reduction occurs is actually a strong point for the chained CPI. Because the savings compound over time, the deficit reduction associated with the chained CPI starts off small and is very backloaded. Of the $390 billion in total savings over the next decade from switching to chained CPI, only a miniscule $12 billion would arise in the first two years. Based on CBO's report on the macroeconomic effects of deficit reduction, that means an economic effect of 0.03 percent of GDP in 2015, essentially a rounding error.

^{Source: CBO}

On the second point, we have said before that whether one views Social Security as a stand-alone program or part of the federal budget, it leads to the conclusion that changes should be enacted sooner rather than later. The editorial appears to take the off-budget view of Social Security, but that view shows that small gradual changes made now can avoid abrupt and harmful changes later. Switching to the chained CPI would close about one-fifth of Social Security's 75-year funding gap. By the unified-budget approach, Social Security is the single largest government program currently. Although it isn't expected to grow as fast as Medicare and Medicaid, it is growing faster than eveything else, certainly much faster than the areas of the budget we have addressed in the spirit of deficit reduction so far.

^{Note: Numbers in the chart are out of date and should not be cited. This chart is being used as an example of the two views.}

On the third issue, the Times to their credit does call for a "statistically rigorous" index for elderly-specific inflation, rather than calling for using the Experimental Consumer Price Index for the Elderly (CPI-E). The CPI-E is not a fully developed price index (hence, the "experimental") and suffers from a number of methodological flaws, including its small sample size, its failure to account for senior discounts and other purchasing habits, and the question of whether the CPI actually measures health care inflation correctly. Still, even a robust version of the CPI-E would represent a policy change rather than a technical correction, since the current COLA, as with most other government programs and provisions, is based on overall inflation. If policymakers were to use a retiree-specific price index for Social Security, this would represent a benefit expansion that should only be done in the context of a plan to make the program solvent. And to be technically accurate, that retiree-specific price index would still need to be "chained."

Finally, it is worth pointing out that while The New York Times editorial is only about Social Security, switching to the chained CPI would actually result in savings throughout government. Indeed, while it would generate savings on the entitlement side it (as Republicans have called for), it would also generate new revenue (as Democrats have called for).

In total, Social Security only accounts for about one-third ($127 billion) of the ten-year deficit reduction ($390 billion), with revenue counting for another one-third and the rest from other spending programs and interest. Indeed, if accompanied with protections for the poor and very old as most chained CPI proposals would, an even smaller portion of the net package would come from Social Security. Maintaining overly generous COLAs for everyone makes little sense when protections can be targeted to the specific vulnerable populations.

Experts from across the spectrum agree that the chained CPI is the best available measure for overall changes in the cost of living. Improved accuracy of inflation measurement should be a goal even absent budgetary impact, but especially given the many tough tax and entitlement choices policymakers will be facing to put the debt on a clear downward path. That is why every serious bipartisan budget plan -- from Simpson-Bowles, to Domenici-Rivlin, to the forming Obama-Boehner plans -- has recommended it. We hope the President's budget follows suit.

Click here to read our full analysis of the chained CPI, "Measuring Up: The Case for the Chained CPI."

Among the many amendments that were voted on to the Senate budget resolution, one caught the eye of POLITICO: Sen. Rob Portman's (R-OH) amendment to have the Congressional Budget Office/Joint Committee on Taxation use dynamic scoring. The amendment passed by a 51-48 vote, with a handful of Democrats joining all Republicans in voting for it. Having written a report on this topic last year, we figured we'd take a closer look at what the amendment would mean, assuming that it passed the full Congress.

First, a little background on dynamic scoring. CBO's scores of legislation do not take account into macroeconomic responses, changes to variables like gross domestic product, employment, or inflation. They do, however, take into effect microeconomic responses, explained as follows in our paper:

The types of behavior estimated under conventional scoring include effects related to the timing of economic activity, shifting of income between taxable and nontaxable categories, effects on supply and demand, and interactions with other taxes. For example, an estimate for a future increase in the capital gains tax will account for the fact that taxpayers will accelerate their realization of gains into the year prior to the tax
increase to avoid the higher tax rate, and will also assume that future taxpayers will sell their assets less often and hold more assets until death. Estimates of lower income tax rates, as another example, would show an increased tax base as people are enticed to shift more compensation from nontaxable benefits, such as employer provided health care and retirement plans, to taxable wages.

Estimates of spending programs also take microeconomic effects into account, such as expected changes in participation, utilization, or reported income. For example, when CBO estimates the effect of changes to Medicare cost-sharing rules (such as higher copayments), they take into account changes in health care utilization (such as fewer visits to the doctor). Similarly, CBO’s estimates for agriculture legislation include anticipated effects on crop prices and production.

Portman's amendment requires that CBO provide a macrodynamic estimate for any changes in revenue (increases or decreases) larger than $5 billion in any fiscal year. For example, while CBO would already take into account a tax rate increase's effect on how much income a person receives in taxable versus non-taxable form, this estimate would also take into account the rate increase's effect on things like GDP or inflation. CBO's budget score would thus reflect these changes, showing how revenue and spending are altered not only from first-order effects and the microdynamic effects, but also the macrodynamic effects. Note that the amendment only requires that this estimate be provided as supplemental information rather than as a replacement for the traditional CBO/JCT score.

There are a number of arguments both for and against adopting or relying on macrodynamic scoring, which we summarized in last year's report. Arguments for it include providing lawmakers with more information about legislation, reducing bias against pro-growth policies in scoring, and taking advantage of advances in economic modeling and new research about the effects of various policies. Arguments against it include the sensitivity the score would have to what assumptions or model the scoring agency uses, the requirement that scorers make assumption about future policy changes or otherwise render an estimate meaningless, and the impracticality of having to keep updating CBO's baseline economic projections for new legislation.

In general, we believe deficit reduction efforts should be designed to add up without the effects of economic growth. Rather, the growth should be pursued to the greatest extent possible, and the benefits could provide an important fiscal dividend. As we explained in our paper:

Importantly, policymakers should be pursuing pro-growth policies regardless of how they are accounted for. In addition to having benefits in its own right, faster economic growth will lead to higher revenue, lower spending on safety net programs, a greater capacity for individuals and businesses to bear tax and spending changes, and a greater capacity of the economy as a whole to carry debt (i.e. higher GDP will lower the debt-to-GDP ratio) – all of which can help the country address its fiscal challenges. Even if scorers do not account for these effects directly, pro-growth policy changes can yield a bonus in the form of lower than projected deficits and debt. Currently, we are faced with making painful choices that, unfortunately, can no longer be avoided. Higher growth will not make painful choices go away, but it will make them relatively less painful.

There is a strong case for supporting something like the Portman proposal, which provides a secondary economic estimate and can thus offer policymakers additional useful information. At the same time, only applying this analysis to the revenue side of the equation neglects the real negative and positive effects that spending changes can have on the budget as well.

Regardless of what is and isn’t measured, we would encourage Congress and the President to pursue policies which both promote economic growth and put the debt on a clear downward path.

Listening to reports on recent budget negotiations in Washington may lead you to believe compromise between the two parties is near impossible, considering what sounds like countless irreconcilable differences. However, an article in yesterday’s New York Times shows that House Republicans and the Administration may not be as far apart as it may seem, at least when it comes to Medicare. The article highlights an area of potential consensus on the need to reform Medicare’s antiquated and complex cost sharing rules.

Currently, Medicare beneficiaries face two separate deductibles – a $1,184 deductible for Medicare Part A (hospital insurance) and a $147 deductible for Medicare Part B (physicians' offices) -- along with a hodge podge of other copays and coinsurance. With no out-of-pocket spending cap, many beneficiaries are exposed to significant cost sharing and therefore purchase private supplemental coverage, known as Medigap, to cover the possibility that they will face huge costs. Roughly 50 percent of the Medicare population have supplemental coverage of some form (i.e. Medigap, employer-based, Tricare) compared to 8 percent with only traditional Medicare (the rest have Medicare Advantage or Medicaid assistance). Because the extra coverage often defrays their health care costs, these beneficiaries do not always make cost-conscious decisions, leading to overutilization and driving up spending. As a result, many health economists and experts have called for reforming cost sharing rules by creating a single, combined deductible with a uniform coinsurance and an out-of-pocket cap.

As the article explains, both the President and House leadership have been open to such reforms. The President has included it in his offers dating back to the 2011 debt ceiling debate and House leadership has suggested their willingness to adopt the policy. Even before the 2011 negotiations, the Simpson-Bowles plan proposed creating a unified $550 deductible, a uniform 20 percent coinsurance rate on all services, and a 5 percent catastrophic coinsurance after $5,500 per year of out-of-pocket expenses, up to a $7,500 hard limit. The proposal would save up to $50 or $60 billion through 2022, and even more if combined with other reforms to supplemental coverage. For example, the Fiscal Commission also included an option to restrict first-dollar or near first-dollar Medigap plans by disallowing them to pay for the first $550 per year in cost-sharing and only half of cost-sharing up to $5,500, saving an additional $50 billion over the next decade. Significant savings could also be achieved if similar restrictions were applied to Tricare for Life, the Federal Employee Health Benefits Program, and employer-sponsored retirement plans that provide first dollar coverage as well. The Moment of Truth Project has a report explaining these options in greater detail.

Others have argued for different restrictions or even a tax on these supplemental plans. The President’s FY 2013 budget included a 15 percent tax on Medigap plans. Most recently, we discussed MIT economist Jonathan Gruber’s plan that would implement an excise tax of up to 45 percent on premiums for Medigap plans and employer-sponsored retiree coverage. In addition to yielding savings to the federal government, these reforms would benefit the poorest and sickest seniors on average. A 2011 Kaiser Family Foundation study found that reforming Medigap coverage could reduce out-of-pocket costs for nearly 80 percent of Medigap enrollees.

As these cost sharing reforms have gained considerable support and attention, different proposals have reflected the ability to easily dial the specifics depending on desired savings and policy priorities. In addition to the Medigap tax, Gruber's proposal offers greater protections for low-income beneficiaries by instituting a progressive out-of-pocket limit on a sliding scale based on income. He also proposed reducing the deductible to $250 for seniors below 200 percent of poverty. Similarly, the Urban Institute’s plan proposes a single income-related deductible with higher deductibles for people over 400 percent of the poverty line, about the same for people between 300 and 400 percent, and lower for people below 300 percent. Other options include changing the level of the coinsurance and/or applying higher levels of cost-sharing to specific services such as home health, skilled nursing facilities (SNFs) or clinical labs. Some other examples from our Health Care and Revenue Savings Options report are listed below.

^{Note: Rough estimates of potential savings from 2013-2022}

Any of these changes could substantially reduce or increase the savings. The NYT article suggests the President would apply his policy to new beneficiaries after 2016. This type of grandfathering would erase the majority of the savings within the ten year budget window and increase complexity by leaving different Medicare beneficiaries with different deductibles, different copays, and other different rules. It would also leave current beneficiaries without the catastrophic cost protections which would be newly available to new retirees. A better alternative to grandfathering would be to phase in changes for all beneficiaries.

While there are many different approaches toward implementing cost-sharing reforms, it is clear that both sides agree our current benefit structure is costly and inefficient. They also tend to agree on a basic framework that includes a combined deductible with some level of out-of-pocket protection and restrictions to supplemental coverage. As we anticipate a growing number of baby boomers entering the Medicare rolls and increasing spending over the next several decades, reforming these outdated rules will be an important part of the discussion on serious entitlement reform that could forge a bipartisan agreement.

We are encouraged and hopeful that the emerging consensus on cost-sharing reforms will be used to help bend the health care cost curve and help put our debt on a downward path as a share of the economy.

Bittersweet – The madness is here. The NCAA tournament field has been reduced to 16 teams, and after this weekend there will be only four remaining. While the budget field has been reduced to two, don’t expect a clean conclusion like the one we will see in Atlanta. In Washington, the brackets are broken before the action begins (for a really scary bracket, check this out). The elimination process gets especially byzantine at this point. In fact, a third budget will enter the picture next month. On the brighter side, a government shutdown will be avoided -- at least until October, but plenty of potential pitfalls remain. However, that’s not deterring Congress from taking a two-week spring break despite some backlash.

Budget Battle Moves to Next Round – Last week, the House and Senate approved vastly different budget blueprints for fiscal year 2014, which starts October 1. The House approved with no Democratic votes the budget drafted by House Budget Committee chair Paul Ryan (R-WI) that relies on deep spending cuts and no additional revenue, and the Senate approved with no Republican votes the budget from Senate Budget Committee chair Patty Murray (D-WA) that features a mix of spending cuts and additional revenue. Several other budgets were rejected. While they all put the debt as a share of the economy on a downward path, they diverged sharply on how to do so. You can compare all the congressional budgets here. The Senate budget was passed after a marathon vote-a-rama where over 100 amendments were voted on. Check out some of the most relevant amendments to fiscal policy here and the full list here.

No Celebrating Yet – A select group of lawmakers will now try to reconcile the two surviving budgets, which not only contain many differences, but also many holes as well. That process probably won’t begin until President Obama unveils his budget proposal around April 8. The negotiations could serve as the new platform for forging a grand bargain to address the debt comprehensively and if a deal is arranged, the reconciliation instructions for the budget could aid the passage of the deal by shielding it from a filibuster.

Spending Bill Signed – As they marched through next year’s budget lawmakers also managed to finally cut down the nets on spending for the rest of this fiscal year. Last week Congress passed a bill funding the government until September 30, the end of fiscal year 2013. President Obama signed the bill on Tuesday. The $984 billion measure takes into account the spending cuts of the sequester and moves around funding for some agencies to make the cuts more palatable. See here for a closer look at how the spending is allocated.

Eyeing a More Accurate Inflation Measure – Chained CPI may sound like a 16-seeded school, but it is actually a small fix with bipartisan support that can significantly reduce the deficit. In previous debt negotiations, President Obama has offered to include switching to the more accurate measure of inflation, known as chained CPI. An updated paper from the Moment of Truth Project says the change can reduce the deficit by $390 billion over the next decade.

Lawmakers Send Themselves Home – Congress is taking a two-week spring break, but their work is coming home with them. Lawmakers are bracing to hear from their constituents about sequestration. If lawmakers get enough pressure from voters, they will be more likely to replace it with a smart, comprehensive plan that is phased-in and more targeted.

Tax Reform Could Be a Cinderella – The powerful chairs of Congress’ tax-writing committees, Sen. Max Baucus (D-MT) and Dave Camp (R-MI), have achieved the type of bipartisan collaboration that has mostly alluded policymakers these days by quietly laying the groundwork for fundamental tax reform. Charles Krauthhammer suggests that tax reform could be the key to a grand bargain and further suggests that reform could involve capping tax expenditures as proposed by Martin Feldstein, Maya MacGuineas and Daniel Feenberg. Read more about the Feldstein-Feenberg-MacGuineas approach here.

Interest in Interest Rates -- The Congressional Budget Office (CBO) says in a new blog post that if interest rates go up higher than expected, it can have a profound affect on budget deficits. We took the data further and illustrated what the CBO scenarios would do to the national debt. Implementing a credible fiscal plan now could keep interest rates from rising higher than they normally would, thus aiding the economy and the budget.

Key Upcoming Dates (all times are ET)

March 28

• Bureau of Economic Analysis releases third estimate of 2012 4th quarter and annual GDP.

April 5

• Dept. of Labor's Bureau of Labor Statistics releases March 2013 employment data.

April 15

• Congress must pass a budget resolution as specified in the Congressional Budget Act. Also, due to the debt ceiling suspension bill, lawmakers will have their pay withheld after this date until their respective chamber passes a resolution.

April 16

• Dept. of Labor's Bureau of Labor Statistics releases March 2013 Consumer Price Index data.

April 26

• Bureau of Economic Analysis releases advance estimate of 2013 1st quarter GDP.

May 3

• Dept. of Labor's Bureau of Labor Statistics releases April 2013 employment data.

May 16

• Dept. of Labor's Bureau of Labor Statistics releases April 2013 Consumer Price Index data.

May 19

• The debt limit is re-instated at an increased amount to account for debt issued between the signing of the suspension bill and this date. After re-instatement, the Treasury Department will be able to use "extraordinary measures" to put off the date the government hits the debt limit potentially for a few months.

May 30

• Bureau of Economic Analysis releases second estimate of 2013 1st quarter GDP.

The Congressional Budget Office has been busy on its blog lately, posting both snapshots of federal programs and also publishing responses to questions they have received from Members of Congress at hearings. Their latest post from director Doug Elmendorf is the latter variety, showing the sensitivity of budget projections to changes in interest rates.

Of course, interest rates are a big factor in a government's interest burden. As an example, the low interest rates the federal government currently faces allow them to pay the same amount in nominal dollars as they did in 2000, despite debt held by the public being more than three times higher.

To see the effect of interest rates on the federal budget, the CBO models three alternate scenarios to their baseline economic projections:

• Nominal interest rates rise to their average for 1991-2000.
• Nominal interest rates rise to their average for 1981-1990.
• Nominal interest rates follow a path consistent with the average of the highest ten economic forecasts in the October 2012 and February 2013 Blue Chip publications.

Using those parameters gets the three-month and ten-year interest rates for Treasury securities seen below. Scenario 2 has by far the highest interest rates, in part due to the higher inflation that prevailed particularly at the beginning of the 1980s.

^{Source: CBO}

CBO also shows how these different scenarios would affect deficits. Scenario 1 would increase ten-year deficits by $1.4 trillion, Scenario 2 would increase them by $6.3 trillion, and Scenario 3 would increase them by $1.1 trillion. These numbers come with a caveat that they do not account for other economic changes which may drive or be the result of the higher interest rates. Higher inflation or better economic performance than CBO expects could be a driver of higher interest rates. Similarly, high interest rates themselves could harm economic growth or otherwise cause the Federal Reserve to tighten monetary policy, affecting other economic indicators. All of these factors would affect the budget through channels other than their effect interest payments, but CBO holds their other economic projections constant.

Also, the fact that CBO uses nominal interest rates means that Scenarios 1 and 2 may be a less telling indicator of future interest rates, since inflation rates going forward may differ from those in the 1980s and 1990s -- CBO's projections have them lower -- or other factors could mean that even real interest rates are lower than in those two decades, which is the case in CBO's baseline projection. Scenario 3 would likely be more telling in terms of how a higher interest rate alternate scenario could look in the coming years, again with the caveat that the higher rates could be the result of other factors which themselves would affect budget projections.

Still, the numbers give an idea of the effect of interest rates on debt. We used CBO's deficit numbers to project what debt held by the public as a percent of GDP would be in each scenario. 

^{Source: CBO}

The low interest rates we are currently experiencing are unlikely to last for a long time, but the path they take to rise and what "normal" they reach has profound implications for the budget outlook. As we've said before, perhaps the best takeaway is to err on the side of caution, agreeing upon a plan with enough deficit reduction to put it on a downward path even if CBO's projections end up being overly optimistic.

It's a well known fact that the U.S. spends much more than other industrialized countries on health care, but just how much more can be surprising. Ezra Klein over at Wonkblog highlights 21 graphs comparing the costs of various procedures in different countries, including routine doctor exams, hospital stays, various surgeries, and different drug prices, using data from the International Federation of Health Plans. The U.S. stands out in every example, and it comes as no surprise that the U.S. spends much more as a percentage of GDP on health care, when including public and private spending together.

^{Source: IFHP}

The U.S. spends almost double the OECD average of health care spending as a percentage of GDP, and roughly less half of that by the federal government. Federal spending on health care is projected to rise in the coming years, driven especially by population aging in the next two decades. Without reforms, health care could begin to dominate the federal budget, shifting funds away from other priorities.

This graph is a reminder that lawmakers need to begin looking at ways to control federal spending on health care, a few of which are presented in our Revenue and Health Care Savings Options paper. The longer we wait to address entitlement reform, the more difficult the problem will be to solve.

Update: This blog has been updated since its original posting to incorporate the House Democratic, Republican Study Commitee, and Senator Rand Paul (R-KY) budgets.

Throughout this week we have done a lot of analysis of budget resolutions as they have been released, breaking down many aspects of their policies and estimates. Now it's time to take a step back and see how the House Republican (Ryan), Senate Democratic (Murray), House Democratic (Van Hollen), Congressional Progressive Caucus (CPC), Republican Study Committee (RSC), Congressional Black Caucus (CBC) and Senator Rand Paul (Paul) budgets stack up on spending, revenue, deficits, and debt. The comparison is useful not just to compare the levels for each, but also to look at the timing and pace of the changes that are made.

First, we look at spending levels in the seven budgets. The CBC and CPC both increase spending to varying degrees -- the CPC budget much more in the short term -- but bring spending to 23 percent of GDP by 2023. The Murray and Van Hollen budgets hold spending between 21 and 22 percent of GDP for most of the decade. By contrast, the Ryan budget reduces spending below the baseline throughout the ten-year window, falling to 19 percent in 2023, while spending is reduced under the RSC budget reduces it to about 18 percent and the Paul budget to below 17 percent.

^{Source: HBC, SBC, CBC, CPC, RSC}

Next is revenue. The four Democratic proposals all raise revenue to various degrees, CPC's revenue increase being the highest followed by the CBC and then the Murray and Van Hollen budgets, which are roughly the same. The difference between each is about a percentage point of GDP by 2023. The Ryan budget calls for comprehensive tax reform that would maintain revenue at current law levels, while the RSC would roll back the tax increases in the American Taxpayer Relief Act, thus having revenue slightly below Ryan.

^{Source: HBC, SBC, CBC, CPC, RSC}

On deficits, the Murray, Van Hollen and CBC budgets take very similar paths, slightly increasing deficits in the short term above the baseline, but bringing them down to about two percent of GDP by 2023. The CPC budget does more on both fronts, increasing deficits by much more in the short term with jobs measures, but bringing deficits down more aggressively over the longer term than the other two budgets. The Ryan, RSC, and Paul budgets bring down deficits more aggressively in both the short and long term, reducing deficits throughout the ten-year window and beyond.

^{Source: HBC, SBC, CBC, CPC, RSC}

Finally, we come to the debt-to-GDP ratios, which somewhat reflect the deficit story. The Murray, Van Hollen, and CBC budgets both have slight debt increases in the short term and put the debt on a downward path thereafter (the CBC is slightly more aggressive on debt reduction). The CPC includes large debt increases in the short term, but they get down to about Murray and Van Hollen's debt level by 2023. The Ryan, RSC, and Paul budgets have debt heading downward as a share of the economy throughout the ten-year window, with the RSC's path being slightly more aggressive than Ryan's, and the Paul's path much more agressive than both.

^{Source: HBC, SBC, CBC, CPC, RSC}

We are pleased to see that each of these budgets calls for putting the debt on a downward path as a share of the economy this decade. The RSC and Paul budgets are obviously the most aggressive and successful towards accomplishing this goal, although the Ryan and Progressive Caucus budgets also put debt on a sharp downward path. We look forward to any additional budget resolutions lawmakers may introduce, which we will continue to analyze as they come out.

In today's Cincinnati Enquirer, CRFB board member and former Senator George Voinovich (R-OH) calls on Ohio's congressional members to get serious about solving our national debt problem. The argument Senator Voinovich makes should concern not only Ohioans, but political leaders and citizens in every congressional district and state.

Higher interest payments, slower economic growth, and greater risk of fiscal crises could all occur if we are unable to put our national debt on a downward path as a share of the economy. It's a problem that will affect all of us, and short term fixes are not the solution. If lawmakers are willing to come together and make the necessary tough decisions, this problem can be solved. Voinovich explains:

Ohio’s congressional delegation must get serious about fixing the debt. In this time of serial self-inflicted fiscal crises, our Ohio leaders are in a powerful position to move Congress toward enacting a comprehensive plan that puts our economy back on track. We must push through the current deadlock between the two parties and find a way to deal with our growing national debt.

The debt problems we face are gigantic. At over $11.8 trillion, the publicly held portion of our national debt is over 73 percent of the size of our economy – the highest share since the 1940s – and it is slated to grow over the coming decades, despite the recent “fiscal cliff” tax increases and “sequester” spending cuts. Even after all of this, the truth is that we just haven’t done enough to get our debt under control.

It’s time for our leaders in Washington to come together and agree on a plan to get our debt under control. Because of the pivotal place in Washington that our representatives from Ohio occupy, they can be instrumental in leading the way to a bipartisan agreement that puts our debt on a downward path as a share of the economy over the long term.

Such a plan must reduce spending through smart cuts to unnecessary and inefficient programs, promote growth through reform to our overly-complex tax code and preserve the integrity of our entitlement programs by passing reforms that make them financially sustainable over the long term.

These reforms will require compromise from both parties and from both ends of Pennsylvania Avenue, but we owe it to our children and to future generations to stop accumulating more debt to leave on their shoulders.

We Ohioans have an opportunity to play a vital role in this process by showing our senators and representatives we support them in coming together to build a comprehensive plan and in making the hard decisions for the good of our country. We need to let them know that continuing to patch together short-term fixes, like we’ve seen over the past few months, is no longer an option.

Click here to read the full op-ed.

"My Views" are works published by members of the Committee for a Responsible Federal Budget, but they do not necessarily reflect the views of all members of the committee.

Continuing in our analysis of the FY 2014 budget resolutions, we will be discussing the things in the budgets that the authors didn't tell you. There were a lot of specifics in these plans that were left up to committees to figure out or for policymakers to work out down the road. Doing so is not really a gimmick, since budget resolutions cannot enact any actual policies; rather, they create processes or parameters within which Congress works. Still, there were many areas where budgets did not specify what they would like to see in areas where they called for savings. Leaving these savings unspecified, without giving illustrative policies, may hide difficult choices that lawmakers would have to make.

We will examine some areas where the three party-endorsed budget resolutions -- from the House Republicans, Senate Democrats, and House Democrats -- left fill-in-the-blanks. They are:

• Tax Reform: This is definitely the biggest question mark in all three budgets. According to the Tax Policy Center, the Ryan budget specifies tax reform parameters -- 10 and 25 percent rates, Alternative Minimum Tax repeal, Affordable Care Act tax increase repeal, and a 25 percent corporate tax rate -- which would reduce revenue over ten years by $5.7 trillion. Since the budget maintains current law revenue levels, that means there is a $5.7 trillion hole that would have be filled with tax expenditure reductions and eliminations or other revenue sources. Both the Murray and Van Hollen budgets call for revenue -- $975 billion and $1.2 trillion, respectively -- from reducing tax expenditures for high earners and corporations. While this is a more easily reachable goal than the Ryan budget's, Howard Gleckman of TPC notes that political reality may make this goal more difficult than it seems. Still, it is in reach as long as policymakers are willing to put the largest tax expenditures on the table. Murray's budget specifically mentions a broad-based limitation on deductions.
• Doc Fix: Senator Murray's budget, to her credit, fully represents the cost of repealing the Sustainable Growth Rate (SGR) formula ($138 billion over ten years) in her budget. By contrast, both the Ryan and Van Hollen budgets call for repeal of the SGR in the context of a deficit-neutral reserve fund. This means that the details of how to offset the doc fix are left up to lawmakers, but they are able to count those offsets in their budget. Granted, both budgets call for health savings that are greater than the cost of the doc fix, but dipping into those pool of savings would obviously increase their deficit numbers. Which brings us to...
• Health Savings: Both the Murray and Van Hollen budgets call for about $275 billion of gross health savings but does not explicitly endorse any policies. The Van Hollen budget does say that those savings could include expanding Medicaid rebates to low-income beneficiaries in Medicare Part D and using recommendations from the Government Accountability Office (GAO) and MedPAC for reducing overpayments and altering mis-aligned incentives. CBO scored the drug policy itself last year, saying that it would raise $137 billion in the 2013-2022 period. Assuming the estimate hasn't changed drastically, that would get the budget half way to its target. The Murray budget is more vague about where the health savings would come from, mostly discussing expanding on the delivery system reforms in the Affordable Care Act and increasing program integrity spending in health care spending to root out waste, fraud, and abuse. As of yet, there aren't savings to be attached to the things mentioned in Murray's budget because they are not specific enough.
• Other Mandatory Savings: All three budgets call for other mandatory savings that are not fully specified. Both Van Hollen and Murray have holes of only about $75 billion to fill, about a third of which is taken up by reductions in farm subsidies. The Van Hollen budget also mentions reforms to the Pension Benefit Guaranty Corporation (PBGC) and eliminating duplications mentioned in GAO reports. The Murray budget mentions selling excess federal property, reducing improper payments, and taking a look at the President's budget's "Cuts, Consolidations, and Savings" section. The Ryan budget calls for $962 billion of other mandatory savings over ten years relative to current law. Its detailed committee report provides specific savings for a number of policies -- block granting food stamps, increasing federal employee retirement contributions, repealing the Social Services Block Grant, reforming the Postal Service, and reducing farm subsidies -- that total about $325 billion, leaving another $635 billion. The budget does mention other policies like reforming the PBGC, reforming or repealing financial regulations, and winding down Fannie Mae and Freddie Mac, and although the savings and policies are not exactly specified, they most likely would not total $635 billion. The budget also calls for reforms to education programs and other means-tested entitlements, but it is unclear how much they would save without more details.

Budget resolutions are not necessarily supposed to be fully completed documents, but this blog shows that if one of these resolutions was accepted, policymakers would still have plenty of work to do to figure everything out.