Out of the Ashes of Budget Politics – A Compromise?
Policy + Politics

Out of the Ashes of Budget Politics – A Compromise?

Budget negotiators spent Monday afternoon talking past each other in the first round of a conference committee charged with melding the House and Senate-passed GOP balanced budget plans into one package. But some Republicans and Democrats also suggest a deal to placate the defense and domestic spending demands of the two parties and the White House may be possible.

The GOP-controlled Congress is expected to agree on a budget plan in the coming weeks. It would fulfill a pledge to eliminate the deficit within a decade without raising taxes – even as few people seriously believe the document will provide a realistic roadmap for spending, taxes and entitlements.

Related: House GOP’s Creative Accounting Lifts Defense Budget 

At issue is whether Congress will stick with strict spending caps on domestic and defense spending mandated by the 2011 Budget Control Act. It could also breach the caps and boost spending by tens of billions of dollars in fiscal 2016, as President Obama and many Democrats favor.

Several weeks ago the House and Senate passed GOP budget plans that used accounting gimmicks to circumvent the $523 billion defense spending cap for the coming year. It would give the Pentagon nearly $40 billion more for general operations.

House and Senate GOP budget leaders had bowed to the demands of defense hawks like Senate Armed Services Committee Chair John McCain (R-AZ) and Sen. Lindsey Graham (R-SC). The two argued that the Defense Department is woefully underfunded to bolster military readiness and properly equip the armed services.

Republicans want to adhere to the $493 billion domestic discretionary spending cap for the coming fiscal year – despite deep cuts in social safety net and educational programs vital to Democrats.

Related: How the GOP Budget Could Help Hillary in 2016

Yet without Democratic and White House support for the spending bills, there’s no way Republicans will be able to keep the government fully operating past the start of the new fiscal year next Oct. 1. That’s why even before House and Senate Republican Budget Committee negotiators can finish their balanced budget blueprint lawmakers are talking about a compromise. It would breach the caps similar to the bipartisan agreement negotiated by Rep. Paul Ryan (R-WI) and Sen. Patty Murray (D-WA) in the fall of 2013, following a 16-day government shutdown.

That deal skirted any serious changes to Medicare, Medicaid or other entitlement programs; but it satisfied conservative members concerned about defense as well as moderate Republicans and liberal Democrats who were protecting key social programs.

House Appropriations Committee Chair Harold Rogers (R-KY) told reporters he planned to begin marking up fiscal 2016 spending bills, based on the statutory spending caps. He also strongly signaled growing support among his committee for a Murray-Ryan style deal that would satisfy the competing factions over spending.

Related: GOP’s Budget-Busting Math Wipes Out Deficit

“The defense hawks are unhappy; nondefense supporters are not happy with the numbers – so I think the pressure is going to build at some point to try to do something” about the 2011 spending caps, Rogers said, according to Politico. Jennifer Hing, the Appropriations Committee communications director, added that Rogers and many members “agree we are going to have to have some sort of long-term budget deal down the road.”

The House GOP leadership hasn’t yet embraced any plan that would simultaneously lift the caps on defense and domestic spending. House Speaker John Boehner (R-OH) said last week he “believes we can get defense the resources they need without increasing domestic spending,” according to Michael Steel, Boehner’s spokesperson.

An aide to the Senate Democratic leadership said, “Many senators would like such an agreement, but the real answer is it is too early to assess the prospects.”

Sen. Sheldon Whitehouse (D-RI), a member of the Senate Budget Committee, said the GOP budget – with its deep cuts and gimmicks for getting to a balanced budget – “is so bad that if it were applied to actual appropriated accounts, I doubt even most Republicans would vote for it.”

Related: House and Senate Duke It Out Over Defense Spending

Democrats have blasted the GOP budget plans because they funnel tens of billions in additional Pentagon spending through an emergency account meant for funding the war effort in Afghanistan and Iraq. The budget also takes credit for tax revenues generated by the Affordable Care Act while it calls for the repeal of Obamacare, they say.

Whitehouse and other Democrats insisted the GOP balanced budgets weren’t “serious” plans. “Our Republican friends will ask President Obama to bail them out by negotiating [out] of this dreadful hole they’ve dug,” Whitehouse said.

Rep. Steve Stivers (R-OH) told Politico he could see a path to another deal along the lines of the Ryan-Murray compromise.

Related: Republicans in Mad Scramble to Placate Defense Hawks

House Budget Committee Chair Tom Price (R-GA) and Senate Budget Committee Chair Mike Enzi (R-WY) yesterday hailed the rival GOP documents that would wipe out the deficit in 10 years. The plans would cut $5.5 trillion of domestic spending, overhaul Medicare and Medicaid, dismantle the Affordable Care Act, and bolster defense spending – all without raising taxes.

“We need to … embrace policies that will foster the growth of a healthier economy,” Price said. “That means a credible budget that balances, reforms key programs and eliminates waste and inefficiencies throughout the federal bureaucracy so taxpayer dollars are spent more wisely.”

Sen. Bernie Sanders (I-VT), the ranking member of the Senate Budget Committee, dismissed the GOP budget blueprints as “nothing less than a disaster for working people.” Rep. Chris Van Hollen of Maryland, the ranking Democrat on the House Budget Committee, said, “Neither budget reflects the values of this country.”

The GOP budgets, Van Hollen added, “are fundamentally wrong for our country and both budgets send a big message to the American people: You’re going to be working even harder, but you’re going to be getting even less.”

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