Obama’s careful claim about entitlement savings
“I’ve offered sensible reforms to Medicare and other entitlements, and my health-care proposals achieve the same amount of savings by the beginning of the next decade as the reforms that have been proposed by the bipartisan Bowles-Simpson fiscal commission.”
— President Obama, remarks to reporters, Feb. 5, 2013
People in Washington can debate forever who is responsible for the sequester. We previously documented how reporting by Bob Woodward shows this originally was a White House idea, but then lawmakers in both parties embraced it. But when the president met with reporters Tuesday to discuss the looming sequester, it was this line about entitlement savings that jumped out at us.
Regular readers may recall that we took a rather long look at this question in November, back when Democrats tried to suggest that Obama’s health-care proposals yielded more savings than Bowles-Simpson. This sentence appears carefully crafted to avoid such problems. So let’s take a look — is this Fact Checker bait?
Bowles-Simpson, or more accurately the National Commission on Fiscal Responsibility and Reform, is considered by many in Washington to be the model for a bipartisan approach for deficit reduction — even though the commission actually failed to endorse the final report. Former White House chief of staff Erskine Bowles, a Democrat, and former senator Alan Simpson (R-Wyo.), were the co-chairmen of the 18-member commission. But you need to be wary when politicians make favorite comparisons between their policies and Bowles-Simpson proposals.
For instance, the Bowles-Simpson report, which was released in December 2010, proposed a budget plan for the years 2012 to 2020, which is effectively a nine-year budget. The Obama budget, released last year, proposed a budget for 2013 to 2022 — that’s 10 years, and a different budget window.
Now, look at Obama’s careful phrasing — “my health-care proposals achieve the same amount of savings by the beginning of the next decade as the reforms that have been proposed by the bipartisan Bowles-Simpson fiscal commission.”
When we listened to Obama, we thought “beginning of the next decade” meant 2020. But an administration official said that he meant the next decade’s budget.
In other words, Obama wants us to compare the savings in 2022. Granted, that would be six years after Obama’s second term ends. But administration officials argue that changes in health-care policies take time to achieve budget savings, and that the right mix can produce greater savings in the long run.
Using Congressional Budget Office estimates of the president’s 2013 budget, we see that over 10 years, Obama’s proposals would achieve $337 billion from 2013 to 2022, compared to $483 billion for Bowles-Simpson in the same time period.
However, in 2022, both would achieve exactly the same amount of savings — $68 billion.
Administration officials say they believe their proposals would achieve greater savings than Bowles-Simpson after 2022, which would be consistent with the increase in savings toward the end of the first 10-year budget window. When we last looked at this issue, at least one budget expert said that assertion is credible, though of course we have no real way of knowing for sure now.
The Pinocchio Test
The president appears to have carefully tweaked his statement to address the concerns we had raised when we previously examined this question.
We are concerned that an ordinary listener might be confused by Obama’s wording; it would certainly make more sense to emphasize savings over the “long term,” rather than “beginning of the next decade.” And some might question why such careful parsing is necessary.
But at least the president is not claiming, as Democrats had before, that he achieves greater savings than Bowles-Simpson in the near term. So, with his very careful wording, he earns the prized Geppetto Checkmark.
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