A Two-Year Budget? GOP Sen. Thune Joins the Chorus
Policy + Politics

A Two-Year Budget? GOP Sen. Thune Joins the Chorus

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With Washington’s official federal budget process stymied by politics and handcuffed by the deficit, Republican Senator John Thune is proposing that Congress and the president scrap the current system and go through the frustrating and difficult exercise only once every two years.

A biennial budget, the South Dakota Republican argues, would provide for more accurate spending planning, blunt the urge to hand out expensive goodies during an election year, and give Congress more time to deal with oversight and other governmental responsibilities.

The idea is far from new. Some 20 states already have two-year budgeting, and the proposal has been kicking around Capitol Hill and Washington think tanks for decades. But Thune, a member of the Senate GOP leadership, thinks now is a good time because of troubling political gridlock and institutional inefficiencies and waste.

“Washington and the budget process is dysfunctional and has been for a long time,” Thune said in a telephone interview from South Dakota with The Fiscal Times. “I am providing alternatives. The criticism of Republicans is that we are simply opposed to [President] Obama. I am laying out a proposal that is very common-sensical and geared to restoring some fiscal responsibility.”

With mounting public concern about the $1.4 trillion deficit and runaway spending amid a persistent recession, the budget has become a tempting topic for ambitious Republican politicians. In addition to Thune, Rep. Paul Ryan, R-Wis., another rising GOP star, has proposed a budget “roadmap” aimed at getting the deficit under control.

Thune, who made a name for himself by toppling former Senate Majority Leader Tom Daschle, D-S.D., in the 2004 election, is running unopposed this time. A former three-term House member, he was one of the first Senate Republicans to endorse Arizona Sen. John McCain’s 2008 presidential campaign, and was mentioned as a possible running mate. Now his name comes up as a possible 2012 presidential candidate. He moved up in the GOP leadership ranks in June 2009, when he became Republican Policy Committee chairman in charge of crafting the Senate Republicans’ positions on issues.

Thirty years of missed deadlines
Under Thune’s proposal, budgets would be passed in odd-numbered years and two-year appropriations bills would be passed in even-numbered years. That would put the budget debate outside of election years and give extra time to members of the House and Senate Appropriations Committees to shape spending bills. “This provision is particularly important because Congress has only completed all of the annual appropriations bills on time in four of the last 34 years,” Thune said, noting that in many years Congress resorted to packaging spending in giant omnibus appropriations bills and continuing resolutions instead of passing individual spending bills in regular order. Thune’s proposal also includes:

  • Imposing caps on government spending other than Medicare, Medicaid, Social Security and other entitlement programs.Putting an end to “stimulus” spending to spur economic growth.
  • Making the budget resolution approved by the Senate and House binding and signed by the president, rather than advisory, as it is now.
  • Establishing a new congressional committee on deficit reduction, instead of leaving it to the existing House and Senate Budget Committees.

Thune said he unveiled this proposal now, three months before the mid-term election, because the issue of the budget and deficit is “heavy on the minds of the American people. We didn’t pass a budget this year and this is peaking to the problems in the existing budget process.”

But veteran budget expert James R. Horney of the Center on Budget and Policy Priorities suggests that the process is not the problem; the policy is. Without general agreement between Democrats and Republicans on overall spending and tax policy, it’s irrelevant what budgeting process is used, he said. “The old saw is when you can’t do policy, you do process,” Horney said. “If you can’t get agreement on really dealing with the long-term deficit – revenues and cuts – there is a temptation to say change the process and that will get us where we need to go.”

Process, he said, can be useful “once you have agreement.”

Nonetheless, Alice Rivlin, a member of the president’s fiscal commission and a senior fellow at the Brookings Institution, has been advocating two-year budgeting for years. “I have always thought we needed a multi-year budget, but it’s never had legs on Capitol Hill,” Rivlin said. “It would give the agencies a chance to plan better. As it is now, they often get the money for one year after the budget years have already begun. The advantage to Congress is it gives them more opportunity to make changes,” she said. “If a budget year is about to begin, you can’t make serious changes. If you really want to restructure or combine two programs, it’s a lot easier to do it if you have more time.”

Not so at all, according to Horney. “The biggest problem in trying to nail down a budget that covers two years is that things change,” he said. “Even with a one-year budget, only a few months after that people say we need to make changes. The war has gotten worse, or we need extra spending for this or that,” he said.

Cheryl Block, a long-time federal budget expert and law professor at Washington University in St. Louis, says there’s an inherent feeling during bad budget times that something must be done to alter the process. “There are surely problems with the process, but I don’t see this making a huge difference,” she said.

Block singled out the spending caps in Thune’s plan. “Every time there’s a change in the process, there’s a gimmick or a way around it,” she said. “It’s like you’re going on a diet, but who’s going to stop you from eating? The president’s commission on the budget is trying to find a plan that could get agreement from Congress and the president, but that is supposed to come after the election.”

And Nicola Moore, assistant director of economic policy studies at the Heritage Foundation, said a two-year budget ignores entitlement spending, which makes up a huge part of the budget and deficit. “If they are not dealing with the elephant in the room, it doesn’t matter what they are doing,” she said. Thune acknowledges that his plans avoid discussing Social Security, Medicare and Medicaid. “There are some elements that we didn’t include,” he said. “We were looking at proposals on entitlements or a balanced budget constitutional amendment, but we had an eye on these things that have strong support. On other things, you would have a hard time getting 51 votes let alone 60 votes in the Senate,” he said.