As National Debt Hits $19 Trillion, a Spending Showdown Looms in Congress
The National Debt

As National Debt Hits $19 Trillion, a Spending Showdown Looms in Congress

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Members of the conservative House Freedom Caucus are starting to dig in their heels against the not-yet-finalized GOP budget for fiscal 2017, signaling trouble for Speaker Paul Ryan (R-WI), who has largely been given a pass by the group since getting the gavel last September.

“We are being asked right now to vote for a budget … at a level of spending none of us support,” Rep. Mick Mulvaney (SC) said Wednesday during a panel at Heritage Action’s annual policy summit. He said that between 90 and 150 of his fellow Republicans feel the same way.

Related: CBO Predicts First Deficit Spike Since 2009

The two-year budget agreement hammered out late last year by the White House, Democrats and former House Speaker John Boehner boosted federal discretionary spending by $112 billion -- $50 billion in fiscal 2016, $30 billion in 2017, and about $32 billion for the Overseas Contingency Operations (OCO), commonly known as the war fund, which does not count against budget caps but does get added to the debt.

Now some of the conservatives who stood back and allowed the generous spending and tax package to sail through Congress late last year are having buyers’ remorse and are looking for ways to trim spending in the coming fiscal year.

The renewed unease over spending comes as the U.S. national debt on Monday reached a record level of $19 trillion -- the equivalent of nearly $60,000 in deficit spending for every American.

Fears about the debt – the accumulated total of deficit spending throughout the years – had largely subsided in recent years as the economy picked up and Congress and the White House agreed to legal spending caps.

Related: Why Is Congress Giving Away $500 Billion in Unfunded Tax Cuts?

However, Republican and Democratic lawmakers and the president forged a last minute compromise late last year to jettison the caps on domestic and defense spending to enable both parties to claim victories on their top priorities. And now President Obama appears determined to press for one last round of his domestic and defense spending priorities before he leaves the White House next January.

The Congressional Budget Office warned last week that fiscal 2016 will be the first in which the federal deficit has risen as a share of the economy as a whole since 2009. That is largely because of the holiday season generosity of lawmakers last December in renewing a handful of pricey expired tax breaks and making them permanent.

But the bigger long-term problem is the growing spending on Social Security, Medicare, Medicaid and the Affordable Care Act, especially as more Baby Boomers retire. If Congress and the White House remain on the current spending trajectory, the deficit will begins to increase sharply after 2018, spiking from 2.9 percent of Gross Domestic Product to 4.9 percent by 2026, according to the CBO.

What’s more, the amount of federal debt held by the public, compared to the overall economy, will also spike, to an estimated 86 percent of GDP over the same time period.

Related: Everybody Wins Something in the $1.1 Trillion Omnibus Spending Bill

Defense Secretary Ash Carter on Tuesday rolled out some details of the Pentagon’s $582 billion budget request for the coming fiscal year, including $59 billion for the war fund, though he indicated that figure could be fungible. Defense hawks, like House Armed Services Committee chair Mac Thornberry (R-TX), have already said that amount, the minimum agreed to in the massive budget deal, is too low and needs to increased, potentially by tens of billions of dollars.

“We’re already hearing that that number we’re being asked for isn’t high enough and over the next couple of weeks the game that you’re going to see played is that folks who want to spend more money will try to increase the war budget and it will work and we will pass a higher level spending using the OCO off the floor of the House,” said Mulvaney.

It will pass, in part, because GOP members are “afraid” of voting against the Pentagon, much to the delight of Democrats who will “invariably” ask for more money for domestic efforts and “we will give it to them because we’re afraid not to,” he added.

The other reason the fight will probably play out this way, Mulvaney noted, is because it’s exactly what happened last year.

Last year defense hawks sought and secured an additional $20 billion in war funding that fiscal conservatives had tried to block. The intraparty squabble delayed the budget, which doesn’t have the rule of law but serves as a kind of guideline for spending priorities. Embarrassed GOP leadership wanted a smooth process after winning back the Senate and added to the list of complaints conservatives in the Freedom Caucus had about Boehner, who was forced to retire by GOP members on the right.

The simmering feud could explode into a major fracas for Ryan, who met with Freedom Caucus members Tuesday night to get them onboard with the budget plan, according to Politico.

Speaking at the policy summit earlier in the day, Ryan invoked the movie Braveheart in making a plea for Republicans to stick together in a presidential election year.

“The question we face in 2016 is simple: Do we want more of the same? Do we want the liberal progressives to lock in all their gains? Or are we, the other party — the conservative party — going to get the country back on the right track?” he asked. “And how do we do that? Well, to quote Braveheart, we have to unite the clans.”

Related: House Freedom Caucus Prepares to Challenge Ryan on 2016 Agenda

Rep. Raul Labrador (ID) said one way to get more Republicans on their side would be to “practice what we preach” about spending and ask fellow GOP members to exam the “bloated budgets” at the Pentagon in addition to social programs beloved by Democrats.

Mulvaney said that unless “we don’t do something dramatically different,” members will end up with another omnibus or short-term spending bill “which is not good for anybody, most specifically Mr. Ryan.”

House Freedom Caucus chair Jim Jordan (R-OH) said that for right now the 40-odd member group is “entirely supportive” of Ryan’s goal to offer policy alternatives to the Democrats on topics like welfare reform. However, he warned that it “should be as specific as it possibly can” in order to ward off meddling by the Senate and send a clear conservative message.

Mulvaney noted that one of the reason Boehner was ousted from office, with much help from the Freedom Caucus, was because he "failed to defend the House as a co-equal branch of government."