The 2025 Spending Fight Has Officially Begun — and It’s Going to Be Big

The 2025 Spending Fight Has Officially Begun — and It’s Going to Be Big

iStockphoto/The Fiscal Times

November’s presidential election looms over the appropriations process for 2025, as members of Congress will want to wait to see who wins the White House and which party can exert leverage over spending plans. But after a prolonged and painful process this past year, there are already signs that funding the federal government for 2025 will once again involve significant tension as Republicans and Democrats clash over non-defense spending levels in particular.

“It’s going to be a big fight,” Sen. John Cornyn of Texas said, according to The Hill.

The Fiscal Responsibility Act that codified a bipartisan budget deal last year calls for both defense and non-defense to rise by 1% for fiscal year 2025. Republicans and defense hawks say that doesn’t make sense given the global threats the country faces. Democrats insist that spending on healthcare, infrastructure and other programs is essential — and that parity has been the key to getting appropriations done in recent years.

House Republicans outline spending plans: House Appropriations Chairman Tom Cole on Thursday announced GOP spending allocations for 2025, including a topline just over $1.6 trillion, or $895 billion for defense and about $711 billion for non-defense spending. The defense figure represents an increase of nearly $9 billion, or just over 1%, and Cole proposes to fund Homeland Security above the president’s request. Non-defense programs, meanwhile, “will be cut effectively by 6%, and those cuts are not evenly distributed,” according to a release from the committee. Some subcommittees, including Labor, Health and Human Services and Education, would be in line for cuts of 10% or 11%.

“In the face of an aggressive schedule and fiscal constraints, we will demonstrate responsible governance and safeguard hard-earned tax dollars,” Cole said in a statement. “The bills written by this Committee will adhere to law set by the Fiscal Responsibility Act—with no side deals—and focus resources where they are needed most.”

Cole also released a markup schedule that would have the committee complete work on all 12 annual appropriations bills by July 10. “This is a very ambitious schedule,” writes John Bresnahan at Punchbowl News. “House Majority Leader Steve Scalise has told us that he wants to pass all 12 bills on the floor before the August break. There’s almost zero chance it actually happens, yet this is House Republicans’ starting position.”

Democrats demand parity: Democrats say that the GOP’s starting position violates the funding deal the parties reached last year and sets the stage for a repeat of the troubled 2024 process. They insist that non-defense spending should be treated the same as defense programs.

“This is the exact same process we saw play out last year,” Rep. Rosa DeLauro of Connecticut, the top Democrat on the Appropriations Committee, said in a statement. “A process where House Republicans, held hostage by their most extreme members, led us from one shutdown threat to another. It was messy, chaotic, harmful, and embarrassing for House Republicans who could not pass their own funding bills. It ended with the majority realizing they could not pass bills without House Democrats. The only difference between last year and this year is that their majority is even smaller. I call on Republicans to rethink the funding levels they released. Increase nondefense and defense funding levels by at least one percent as agreed to almost a year ago today.”

DeLauro and Democrats say that non-defense spending should be at least $786 billion, or $75 billion above the Republican proposal.

Battles brewing in the Senate, too: The disagreements are also playing out on the Senate side, where appropriators were able to work in a more bipartisan fashion for 2024. Sen. Patty Murray, who heads the Senate Appropriations panel, is seeking equal increases for defense and non-defense. “For me the word of the day, today and every day until we pass our funding bills, is going to be ‘parity,’” Murray reportedly said earlier this month.

But Republican Leader Mitch McConnell has already said he won’t agree to dollar-for-dollar parity. “I can’t accept that at all,” McConnell said last week, as The Hill’s Alexander Bolton reports.

McConnell argues that the threats from Russia, China, North Korea, Iran, and terrorist groups make this the most dangerous time since the fall of the Soviet Union and demand significant military spending increases that don’t need to be matched on the non-defense side. “We can’t let partisan spending priorities hold the common defense hostage,” McConnell said earlier this month. “It’s time to acknowledge that the growing threats to our peace and prosperity deserve our utmost attention.”

Sen. Susan Collins of Maine, the top Republican on the Appropriations Committee, agrees with McConnell. “Given how underfunded defense is and the global threats we face, I don’t think parity can be achieved,” she said, according to The Hill.

Democrats reportedly counter by pointing out that the $95 billion supplemental package Congress just approved for Ukraine, Israel and the Indo-Pacific included billions more in defense spending.

What’s next: Appropriators have reportedly discussed a spending patch that would extend current federal funding into February, allowing lawmakers to focus on the final weeks of the election campaign — and, from the perspective of some Republicans, allowing Donald Trump to have a say in the process if he’s elected.

The bottom line: Fiscal fights may take a backseat to campaign clashes from now until November, but they’re already starting and they’re going to be major. And the spending battle may just be a preview of an even bigger one over expiring tax provisions.