The President's Budget, In One Table

Update: The table and text have been updated to include the baselines in the House and Senate budget resolutions.

A common source of confusion when budgets are released is how they calculate their savings. It seems that for every budget that comes out there is a different baseline from which savings are measured. The President's budget is no exception.

The budget use OMB's "adjusted baseline" (Table S-8) which is a combination of what many budget experts consider "current policy" (embodied by the CRFB Realistic Baseline) and a current law baseline like the one used by CBO. Like current policy, OMB's baseline assumes that the 2009 refundable credit expansions are made permanent, and doc fixes are made permanent to prevent large Medicare physician payment cuts. Like current law, their baseline assumes that the sequester goes off, and war and Hurricane Sandy relief spending continues to increase with inflation rather than being drawn down as expected. This "hybrid" baseline means that the headline savings that are presented are different than one would get measured against either a current law baseline or a common iteration of current policy.

To clear up the confusion, we have produced a table that shows our estimate of the savings against all three baselines plus the baseline used by the House budget baseline, which is the same as current law but also includes the war and Sandy drawdowns.

^{Note: Positives/negatives reflect deficit decreases/increases, respectively. Numbers may not add up due to rounding
`Includes $3 billion postal service adjustment
*Classified as spending by OMB but counted as revenue by CRFB
^Using CBO concepts}

Later this week, we will use these estimates to compare the President's budget to the Murray and Ryan budgets on a like basis.