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Articles:

The Budget Deal is Now Law. What Happens Next? - August 3, 2019
Sweet and Sour Shutdown - January 10, 2019
Many Paths Possible for Post-Election Appropriations - October 24, 2018
A Case Against Biennial Budgeting - August 9, 2018
Rescissions Redux - June 5, 2018
A Step Forward on Infrastructure - March 28, 2018
What a government shutdown really does - February 6, 2018
The State of the Union Deficit - January 31, 2018
Executive Branch earmarks: walking-around money for bureaucrats - January 15, 2018
Congressional earmarks benefit communities - January 13, 2018
New year, new budget? ​- January 1, 2018
Year-end budget drama - November 28, 2017
​Appropriations Endgame - October 17, 2017
Dead on arrival? Nope - September 17, 2017
An 8-armed appropriations plan shaping up - August 16, 2017
See you in September - July 28, 2017
Full speed ahead - July 12, 2017
The staggering imbalance of the federal budget - July 3, 2017
Your guide to the coming fiscal kerfuffle - June 6, 2017
Five takeaways from the Trump budget - May 23, 2017
What to look for in Trump's budget - May 17, 2017
Shutdown shenanigans - May 9, 2017

See you in September

7/28/2017

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The House of Representatives left for its August recess following an expedited appropriations process in June and July. After receiving the Trump administration’s budget very late (May 23), the House Appropriations Committee still managed to report out all 12 annual appropriations bills by July 19. That is a noteworthy accomplishment.

What followed was more complicated.

Some House members wished to bring all 12 appropriations bills to the House floor before leaving for the recess. Their plan was to combine all the bills into one big package – an omnibus appropriations bill.

While this approach would have given members the right to say they completed the House’s responsibility to pass appropriations, it proved to be a bridge too far from a practical perspective.

House Republican leadership polled its members on their support for such a bill, and found that too many of them could not commit to voting for its passage. Some members were worried about unwelcome amendments to the bill that could pass, others were worried about what might be in the more than 1,600 pages of the base bill.

The House instead moved forward with a smaller bill – one that included appropriations for Defense, Energy and Water Development, Military Construction and Veterans Affairs, and the Legislative Branch (the bill also included money for border fencing and wall construction for the Department of Homeland Security). This “Make America Secure Appropriations Act” was approved by the House by a largely partisan vote of 235 to 192 (five Democrats voted in favor of the bill and five Republicans voted against it).

Over 300 amendments were submitted by members who wanted changes to the bill. Of those, 126 amendments were allowed by the rule governing how the House considered the bill.

The eight appropriations bills that were not included in this smaller package would have drawn many more amendments. The Department of State-Foreign Operations bill and the Departments of Labor, Health and Human Services, and Education bill haven’t been considered for amendment in the House since 2009. These bills alone potentially would have had hundreds of amendments submitted due to the controversial and partisan issues within them.

But there may still be an opportunity for House members to have a shot at the remaining bills. House Republican leadership signaled that these eight bills will come before the House in September. They could even try to combine them into another big appropriations package.

An impediment to getting that done is time. There are only 12 legislative days available in September, providing little time for a lengthy debate on a massive appropriations package with hundreds of amendments.

There are other must-do items for the House to take up, including passage of a continuing resolution before September 30 to keep the government running. Other possible items on the agenda include the budget resolution, the debt ceiling, tax reform, another attempt at health care, reauthorization of the Federal Aviation Administration, an overall budget agreement to change the spending caps, and more.

There also may simply be less interest among House members in taking up another big appropriations bill. The hope had been to pass a 12-bill package before leaving Washington for the August recess so that members could have something significant to brag about during the five weeks in their districts. That incentive lessens after the recess.

Other possibilities are a smaller package comprised of two or three appropriations bills or a plan to take one or two bills to the floor individually. The Interior and Environment bill and the Financial Services/General Government bill are likely candidates since they include provisions of interest to many House Republican members. Another option is to immediately start work on a continuing resolution.

Appropriations will eventually get done even if the House doesn’t pass another big multi-bill package. There will need to be lengthy, bipartisan negotiations between the House and Senate to develop a final bill that can pass both houses and be signed by the President.

​This process won’t be easy, and it won’t be pretty. But it will get done.
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Full speed ahead

7/12/2017

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​Disclosure: I spent 20 years on the staff of the House Appropriations Committee, so I am biased in favor of the Committee and its work.
 
The annual appropriations process got off to a slow start this year. Congress didn’t receive the President’s budget request until May 23 – 106 days after the date the Congressional Budget Act says budgets should be submitted.
 
The House Appropriations Committee is now making up for lost time in a significant way. Its schedule this week includes five subcommittee meetings to consider draft fiscal year (FY) 2018 appropriations bills, as well as two full Appropriations Committee meetings on four separate bills. This means that nine of the 12 appropriations bills the Committee annually drafts are moving forward this week, which makes it as active a work week as I have ever seen.
 
These bills include a multitude of difficult and politically-charged issues (such as the President’s border wall proposal), potentially making these meetings long and drawn-out with many potential partisan amendments offered.
 
As I write this on Wednesday, July 12, the full Committee is meeting on the FY 2018 Agriculture bill and the FY 2018 Energy and Water Development bill. On Thursday the Commerce, Justice, Science and the Financial Services and General Government bills will be before the Committee.
 
In subcommittee this week, these five bills are on the docket: Transportation, Housing and Urban Development; Interior and Environment; Homeland Security; State, Foreign Operations; and Labor, Health and Human Services, and Education.
 
This intensely active work week shows that the Appropriations Committee is serious about getting its work done. We should expect to see a similarly busy week starting July 24, with most, if not all, of the bills that are in subcommittee this week being considered by the full Committee.
 
Regardless of whether you believe the federal government spends too much money in these bills, or if you believe the bills shortchange funding for important programs, you should acknowledge how seriously the Appropriations Committee is taking its responsibility to complete its work.
 
The current fiscal year ends on September 30. The late start to the process virtually ensures that a continuing resolution will be necessary to keep the government funded after that date, but the Committee is working hard to deliver bills to the House floor so that representatives can offer their input by proposing amendments.
 
In a week where Washington’s attention is once again focused on new Russia revelations, I believe we should not let the Committee’s efforts to conduct the nation’s business go unnoticed.
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The staggering imbalance of the federal budget

7/3/2017

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​Shortly before Americans went off to grill their burgers and gaze at fireworks for the Fourth of July holiday, the Congressional Budget Office (CBO), Congress’s nonpartisan team of fiscal analysts, issued a dire warning:
 
“As deficits accumulate in CBO’s baseline, debt held by the public rises from 77 percent of GDP ($15 trillion) at the end of 2017 to 91 percent of GDP ($26 trillion) by 2027... At that level, debt held by the public would be the largest since 1947 and more than twice the average over the past five decades in relation to GDP... Three decades from now… debt held by the public is projected to be nearly twice as high, relative to GDP, as it is this year--a higher percentage than any previously recorded in the nation’s history.” Congressional Budget Office, “An Update to the Budget and Economic Outlook: 2017 to 2027”, June 2017 (Emphasis added)
 
 If current laws governing spending and taxes remain the same, federal deficits and the debt will increase considerably in the coming years and decades. Deficits will grow from an estimated $693 billion in fiscal year 2017 to nearly $1.5 trillion by 2027. Relative to the size of the economy, the 2017 deficit will be 3.6 percent, and the 2027 deficit will be 5.2 percent, of gross domestic product (GDP).
 
The numbers are more troubling the further into the future CBO goes. In March, CBO predicted a 2047 deficit that would be 9.8 percent of GDP, with federal debt held by the public reaching 150 percent of GDP (compare that to 77 percent in 2017).
 
There are those who will quibble with the accuracy of CBO’s estimates. But the precise numbers are far less important than the indisputable fact that they show current fiscal policies failing to be sustainable in the long-term.
 
CBO, in its report, describes the ramifications of increased debt:
  • Increased federal spending on interest would occur, crowding out other spending (net interest payments by 2027 would be over $800 billion – larger than CBO’s estimate of defense spending for that year).
  • Increased federal borrowing would reduce total savings, reducing productivity and wages.
  • Increased pressures on the budget would make it harder to use tax and spending policies to counter economic downturns or address urgent national needs.
  • Increased chance of a financial crisis resulting from greater risk in the financial markets and the possibility of interest rates rising “suddenly and sharply.”
 
What can be done to reverse this trend before it’s too late? While CBO does not make policy recommendations, in December 2016 it provided Congress with a list of 115 options to reduce spending or increase revenues. Many of these options are worthy of consideration, although many are also politically difficult.
 
There are three broad areas that shape the budget--
 
Entitlements such as Social Security, Medicare, and Medicaid are major drivers of increased deficits and debt. Medicare, for example, rises from $701 billion in 2017 to nearly $1.4 trillion in 2027, according to CBO’s estimates. Significant deficit reduction is unlikely if these programs are left untouched. But it is extremely difficult, politically, to reverse course on the benefits promised by these programs.
 
Discretionary spending that funds the day-to-day operations of government could be reduced, but this spending has already been cut over the past six years. The cuts have hit bone in many cases, and many in Congress, on both sides of the aisle, reject the significant additional nondefense cuts called for in the Trump budget and strongly support large increases in the defense budget.
 
Revenues are the other side of the deficit equation. But tax increases are abhorrent to politicians, especially when they recall what happened to Bush 41 when he went back on his “no new taxes” pledge.
 
But doing nothing is not an option. Getting control over the deficit and debt requires a willingness to make hard choices. Nothing should be off the table.
 
Difficult decisions need to be made before the budget explodes like a crate of Fourth of July fireworks.
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    Author

    Dale Oak’s career in federal budget and appropriations spans more than 30 years. His most recent position with the government was Senior Advisor to the U.S. House Committee on Appropriations, where he was an appropriations process expert helping to guide appropriations bills from initial drafting to enactment. 

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