Opening Statement of the Hon. Amo Houghton, a Representative
in Congress from the State of New York,
and Chairman, Subcommittee on Oversight
Hearing on the Modeling the Economic Effect of Changes in Tax Policy
May 7, 2002
Looking into the future is next to impossible. However there are trends and economic roadmaps we can use to more scientifically tell us probabilities. To have an understanding of legislation one must use these methods. There is no alternative other than to fly blind.Certainly, it is not realistic to expect that the tax revenue estimates will faithfully predict the precise outcome of every tax proposal. It is understood that your estimates represent the best judgment of experienced tax professionals and economists; they are not crystal ball predictions of the future. Nevertheless, the methods that are used to arrive at these estimates fundamentally affect tax policy. It makes sense to use the best tools available to us to make the best possible predictions.
Because of the importance of your predictions in forming tax policy, it is also important that the methods behind them be publicly disclosed to the fullest extent possible. I understand that you have disclosed a great deal of information about the estimating process, and I want to specifically acknowledge your willingness to work with Congressional staff to understand individual estimates where the need arises.
Today we will hear from a familiar face, Lindy Paull, the Chief of Staff of the Joint Committee on Taxation. Although she is not an economist, by training, I doubt there is anyone in this city who understands this issue better than you, Ms. Paull. In addition, we are honored by the presence of Glenn Hubbard, the Chairman of the President’s Council of Economic Advisors. Mr. Hubbard was the chief economist in charge of estimating tax proposals for the Treasury Department during the first Bush Administration, and he is eminently well qualified to address this issue.
I am pleased to yield to our ranking Democrat, Mr. Coyne.