Thoughts on Dynamic Scoring of Fiscal Policies

Abstract

Former CBO director Doug Elmendorf recently argued that Congress should account for macroeconomic feedback when scoring major tax and spending policies. In this brief, Donald Marron agrees, arguing that CBO and JCT can implement such dynamic scoring in an objective, nonpartisan manner. Dynamic scoring will neither live up to the hopes of it proponents nor down to the fears of its detractors. Instead, Marron argues, it will modestly improve the budget estimates that inform policymakers and the public. This brief originally appeared as a comment on Elmendorf’s paper in the Fall 2015 Brookings Papers on Economic Activity.