Is The CBO Merely Another Manipulated Front For Wall Street To Dictate Washington Policy?

Tyler Durden's picture

In the past, when discussing the goalseeking C-grade excel jockeys at the Congressional Budget Office (or CBO), we have not been technically full of reverence. After all when one uses a phrase such as this one: "What do the NAR, Consumer Confidence and CBO forecasts have in common? If you said, "they are all completely worthless" you are absolutely correct", it may be too late to worry about burned bridges. We do have our reasons: as we pointed out last year, following the whole US downgrade fiasco when the Treasury highlighted the CBO's sterling work in presenting a US future so bright, Timmy "TurboTax" G had to wear shades, we said "according to the same CBO back in 2001, net US indebtedness in 2011 would be negative $2.436 trillion, the ratio of debt held by the public to GDP would be 4.8%, total budget surplus would be $889 billion, and GDP would be $16.9 trillion." As we know now they were off only by a modest $17.5 trillion on that debt forecast. Yet we never attributed to malice and bias and outright corruption, what simple stupidity and gross incompetence could easily explain. Until today that is, when following a WSJ article, we are left wondering just how deep does the CBO stench truly go and whether its employees are far more corrupt than merely stupid?

As a reminder, the CBO is "a nonpartisan arm of Congress—employs analysts and economists who are charged with trying to estimate the potential financial impact of proposed policies and legislation." So far so good - they also happen to be beyond worthless at their job, and if they were in the private sector they would be fired with extreme prejudice. Of course, they are government workers, so anything goes. Which is where the problem arises: because while as the WSJ says, the CBO should be impartial, it turns out it is anything but.

Republican staffers on three Senate committees are pressing a congressional office that scrutinizes federal budget issues and proposed legislation over how its assessments are compiled. The inquiries of the Congressional Budget Office, which haven't been made public, concern the CBO's analyses of some of Washington's most complex and controversial measures, including bills on financial regulation, health care, small-business lending and efforts to aid the housing market, said people familiar with the matter.


As part of the inquiries, some Republican committee staffers are examining whether CBO officials adequately monitored and disclosed the role of Wall Street banks, academic researchers with government ties and other outside advisers, the people said. They are pushing for greater transparency in the CBO's dealings with advisers, to shed light on the role of outside interests in shaping the office's views, the people said.

Realistically, it is true that the CBO can be the target of either party if and when its conclusions do not resonate with proposed policy.

The CBO regularly comes under fire from members of both political parties—particularly when their goals for proposed legislation are undermined by the agency's analysis. It is "an easy target" because of its role in shaping legislative debates, said John Wonderlich, policy director for the nonpartisan Sunlight Foundation, a nonprofit focused on government transparency. He said the CBO should be more open with the economic models it uses, and should produce documentation detailing its use of outside advisers. "That oversight is entirely appropriate," Mr. Wonderlich said.

... As is precisely the case now:

Republican Budget Committee staffers are questioning the CBO about disclosures of details related to projected costs of health-care legislation and broader economic policies, say people familiar with the matter. People close to the matter say the CBO in recent months has resisted efforts by Republican staffers to obtain documents and communications stemming from the office's views on a long-term care provision. Administration officials in mid-October declared the provision not viable, after previously supporting it.


"The Budget Committee has been engaged in routine conversations with the Congressional Budget Office over how best to estimate the fiscal impact of the President's health law," and hasn't been pursuing an inquiry into the CBO's "professional conduct," said a spokesman for the committee's Republican staff.

So far so good: incompetence, with a dose of politics, explains all of the above.

Yet what is not explained anywhere is the following revelation:

In another inquiry, investigators working for Sen. Charles Grassley, the top Republican on the Senate Judiciary Committee, are probing allegations made privately to the investigators by a former CBO economist that she was fired for producing work at odds with Wall Street research favored by her supervisors, according to people familiar with the matter and documents related to the inquiry.


The ex-employee, Lan T. Pham, alleges she was terminated after 2½ months for sharing pessimistic outlooks for the banking and housing sectors in 2010, according to correspondence and other documents related to the inquiry, reviewed by The Wall Street Journal, and her lawyer, Gary J. Aguirre. Ms. Pham, 40, alleges supervisors stifled opinions that contradicted economic fixes endorsed by some on Wall Street, including research from a Morgan Stanley economist who served as a CBO adviser. As part of the review, Sen. Grassley's staff is examining whether Wall Street firms or others exert influence that compromises the office's independence, say people familiar with the matter.

And here we were thinking that only John Paulson fired his analysts for being too bearish (true story). But that is not the issue: what is most troubling is if indeed the CBO is nothing but merely another front for Wall Street to work its propaganda magic on the administration. Because at the core of every policy are numbers, usually with dollar signs in front of them, numbers which have to make sense and have to be projected into the future, no matter how grossly laughable the resultant hockeystick. And it is only logical that the grossly incompetent CBO "analysts" will lick the boots of Wall Street's "strategists" only to get a glimpse of those complicated (if also utterly worthless models: remember that Goldman call for a new US renaissance by Jan Hatzius in December 2010, roundly mocked by Zero Hedge, and which even Goldman subsequently apologized for?) models which always paint a rosier picture, as is necessary in a ponzi scheme which, like a shark, must always be moving, every higher, or else the house of cards collapses. It also means that Wall Street's means of peddling influences are far more insidious than originally thought, and that they have penetrated the very number crunching machinery that while merely a front, is a critical component of every legislation.

Alas, none of the above is surprising: just like the SEC, where the dregs of the analytical and legal world end up, praying that one day the very people they prosecute will hire them (at a salary multiples higher than what they get paid currently), so the CBO workers will do all in their power to come up with some results which appear at least modestly objective yet are entirely driven by neither the Democrat nor Republican agenda, but that emanating from the financial region in New York.

And just to put a final nail in the objectivity of anything to have come out of the CBO in the past decade, and probably ever, here is another chart by John Lohman which shows that just like the BLS, which probably also one day will be discovered to get its financial "tips" from Wall Street, the CBO does nothing better than hope for the best, and prepare for the even better.

Finally anyone wishing to listen to the boss of this latest infiltrated by Wall Street political organization stammer, can do so tomorrow: "Mr. Elmendorf will testify at a Senate Budget Committee hearing Thursday on the budget and economic outlook." We are quite confident he will have only glowing things to say about the future.

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DeadFred's picture

If the nice black ops men are holding your family you pretty much write the report you asked to write.

dwdollar's picture

No need. There's plenty of "yes men" and traitors who would gladly suck dick to do it for 60k a year.

CH1's picture

True words...

The Fedguv employs millions of 'em.

The states and cities and corps employ the rest.

Oh regional Indian's picture

Communism under the guise of Republicanism pretending to be a Deomancrazy. How could we expect any different?

And yes, one only needs to look as far as Cops and OWS to know which side of the fence .gov employees hope to be sitting when the fences are finally erected. ndn by the way, those electronic ankle collars? ..........

The fence will be two-fold too. In your mind and in the ether. The attention to detail is as stunning as the Asleepness of the masses.

What was that, give me Liberty or some other such tattered Slogan?

Congressional Backstop Orifice.




indio007's picture

I can get alot more done than that for a 20 piece.

piceridu's picture

Amazing what these cocksuckers will do for 30 pieces of silver...traitors the whole lot of them.

Stack Trace's picture

I wish I could get paid to be so wrong so often.

OldPhart's picture

"...we are left wondering just how deep does the CBO stench truly go and whether its employees are far more corrupt than merely stupid?"

They are in Washington, DC and they work in the Federal Government.  They are corrupt, it's a given.  Stupid?  Not a given.  You have to be clever to prevent getting caught.

lolmao500's picture

Or rich enough or own a printing press. Bribes, excuse me, political contributions, are legal.

UP Forester's picture

No shit?  CBO and BLS numbers are wrong?

And they get their formulas from the very entities that profit from their analyses?


tony bonn's picture

"whether its employees are far more corrupt than merely stupid?..."

it is a supreme fallacy to attribute to stupidity what is better explained by corruption....

we know that congress is the bought and paid for whore of wall street, so its operations are the result of bankster prejudice...

nothing significant happens by accident....believing so will have you waiting for a monkey to type war and peace from his recorded stream of consciousness....(my apologies to evolutionists)

vh070's picture

The problem is those doing the corrupting are ideologically inclined to view their actions as not corrupt.  So how do you deal with ideology?

kito's picture

And I thought weathermen had it good......

barliman's picture


Ever see your local weatherperson out in public, off camera? These are not happy people. If we treated our politicians proportionally to how we treat someone for the getting the weather forecast wrong, there would be one of them stoned to death every other week.

Perhaps, you meant to capitalize the word ... in which case, you're right former Weatherman do enjoy the confidence of the current POTUS.


slewie the pi-rat's picture

hmmm...i might like being a weatherperson...

they wouldn't show me on tv passed out in front of the fridge from the occupational side effects, would they?

oh, who cares!  sign me up! 

barliman's picture



Nope, it's right here in the contract, "... no additonal public embarrassment allowed." The teleprompter reading anchors however are fair game. Dibs on the blonde bimbo with the IQ of 100 and daddy issues!


GMadScientist's picture

So you like them smarter than yourself.

Bear's picture

Where is the best place online to buy gold/silver Eagles? And, are Eagles better than Maple Leafs?

slewie the pi-rat's picture

2 years, 18 weeks and 29 pages of posts for this?

are you lost, or drunk, perhaps?


barliman's picture



The poor bastard's in shock. We need to find a blanket and a bottle of bourbon. We can wrap him in the blanket and drink the bourbon while we keep an eye on him.


slewie the pi-rat's picture

if you think the bear is another negative interest rate stretcher case, i'll accept that rather than shit in his/her woods


barliman's picture


Who gives a shit what's wrong with the delirious bastard?!?

This is about the bourbon. It is the only known cure for negative interest rates.

Drink up!


Mr Lennon Hendrix's picture

I will gladly watch the bear and drink bourbon all morning long.  We are planning on going throught the morning, right?

barliman's picture


Yes, it's the least we can do under the circumstances. Anyone wanting to do more is on their own. The bourbon stays with us!


slewie the pi-rat's picture

oh, wait!

maybe you just don't want people thinking about the CB0!

thxz4playing, asswipe!

lasvegaspersona's picture

The non condescending adult on the page answers is Tulving if you can do 20 ounce minimum orders....see that did not hurt...

slewie the pi-rat's picture

so, we're s'posed to think about buying PMs from tulewiggy instead of budget office? 

is that what you non-condescending trolls are up to here?

Jim in MN's picture

I like the Godiva but others prefer the Dove Extra Dark.  They can take their Extra Dark and shove it up their asses.

er, you did mean chocolate coins with the with gold foil, right?  Shit...mumble......

kito's picture

Godiva and dove are both crap chocolate. Lindt 90 pct is the bomb

slewie the pi-rat's picture

unnhhh... suppositories, kito?


barliman's picture


psssst, slewie ...

The chocolate is just bait for the gerbil


orangedrinkandchips's picture

thing is Timmy is so fucking dumb he swallows the fucking suppositories and wonders why they dont work!


seek's picture

I haven't spotted a serious reply yet.

If you're buying in quantity Tulving is pretty good, and they're open pretty much 24/7.

My personal opinion is that if you're in the US, eagles are better than maple leafs, and eagles are far more durable (different alloy, so they're not as soft as leafs, which are really soft and scratch easily.)

Gold eagles are easily the most liquid coin you can own in the US, which is why I tolerate the premium over spot (some of which you'll get back when you sell, which is never.)

Bear's picture

Thank you for your reply

slewie the pi-rat's picture

ya know what?

all 3 of you fuking Tulving trolls can beat it, asswipes!

what a bunch of fuking bulklshit from a 2 year 19 week, 29-page worthless motherfuking troll named "Bear" and his two little "innocent"  troll friends

TULVING = PHONEY PHUCKING LOSERZ to pull this shit on zeroHedge, BiCheZ! 

Bear's picture

Thank you for your considered response. I have been buying and selling gold futures for ten years now, but I have never purchased any physical metal and I was interested in how best to do it. If this makes me a troll, then so be it. It would seem that you have something against Tulving (or maybe just the mention of a commercial venture) ... if you think there is another better source, I am certain open for your ideas also ... sans your fuking profanity

slewie the pi-rat's picture

no, i just don't like trolls who come and pretend shit, asswipe!

what did you think about for the first two years and 18 weeks you were here?  i've been here less than half the time and this very question has been asked and thoroughly answered at least 50 times, imo

didn't you notice? 

if you're this fuking ridiculously styoooopid and fuking helpless to figure this out by yourself, at this point, you don't belong here, bear

try googling silver coin dealers for pete's sake, you fuking jack-off!!!

and, since you're just obviously (to me and probably a few hundred others at this point) pretending, to get TULVING'S FUKING ASSWPE NAME UP here, tonight, you can go fuk yourself twice, as far as i'm concerned!

Bear's picture

Google! Damn I should have thought of that.

Maybe I could have entered "silver coin dealers real life experiences who is the best"

slewie the pi-rat's picture

yeah, i know!

especially after only 120 weeks as a zeroHedge "member", you viscous little cunt!

Bear's picture

Where did you come by such a vicious streak?

slewie the pi-rat's picture

dealing with passive-aggrssive shitheads like you, probaqbly, now that i think of it, TULVING TROLL!!!!

i know!  i hafta be the bad guy, 'cause you TULVIG guys wouldn't want to look like a bunch of ignorant asswip trolls in zeroHedge, would you? 

might be bad for YOUR "silver" business, huh?

about one more trip, and you'll never get another order from about 2100 reads and a few score commenters

it's your  business, you decide how deep ya wanna plow it under here, ok, shitforbrains?

or do ya wanna pretend i was just "crazy" with my very first comment to your little game here, way back up this very string, mrTulving

you viscous little TULVING CUNT!!!

Bear's picture

Maybe you have some other of my posts that can lead credence to you rant? No you can't ... I walked into a buzsaw of venom with my simple question.

Raging Debate's picture

I have to agree Bear. Slewie, you have the fire! But perhaps we should remind ourselves on who or whom the intended target of your fire is. I haven't seen a website devoted to Congressional voting records. I could come up with others. I myself use my fire to finish a publishing utility. 500 Zero Hedges would be better than one no?

fiftybagger's picture

Yeah, I don't know if someone peed in his cornflakes this morning or what.   Anyway, for the honest inquirers I usually cover: - The biggest and best selection - 2d biggest, sometimes better prices - lots of good deals - best bulk deals for bigger buyers.  E.G. 500 oz minimum.  No CC, just wire

Neat new site someone sent me:

Keep Stackin'

Silver For The People


Vic Vinegar's picture

I have been buying and selling gold futures for ten years now

Where is the best place online to buy gold/silver Eagles? And, are Eagles better than Maple Leafs?

Saavy enough to buy and sell gold futures for a decade but can't get your shit together on making an internet purchase, huh?

Seems like slewie was being nice to you buddy.

Bear's picture

I am really glad to see that you have been appointed as TrollGuard here at ZeroHedge for the last 1 year and 1 week ... I can sleep much better knowing that TD has such fine help.

slewie the pi-rat's picture

just get the fuk away from here you fuking shitforbrained asswipe TULVING TROLL!!!!

you don't need to attack others, here, too



jeeeez!  how fuking dumb do you think the readers are here?  lQQk what you turds have left here as an "innocent" Q & A session! 

solly, worong #!

now stop wasting people's time and disrespecting the site, ok?  nobody appointed me anything friend

why?  you got a problem with fight club, asswipe?

Vic Vinegar's picture

I am really glad to see that you have been appointed as TrollGuard here at ZeroHedge for the last 1 year and 1 week ... I can sleep much better knowing that TD has such fine help.

Believe you me, if some of us could choose slewie would be the TrollGuard.  Back in the day Tyler once gave us an ombudsman whose credentials included an affinity for HL Mencken (sorry but I can't forget that).

Anyhow, she would have been a shitty choice.  slewie would be a much better one.

Maybe one day you'll figure out how to buy gold online.  Good luck, spacemonkey!