Line Items: Brinking Game Edition A Weekly Update on Budget and Fiscal Policy Developments and a Look Ahead
Brink Again – Washington’s favorite game played out again last week as lawmakers once more waited until the last minute to avert a government shutdown. A bill funding government operations not already financed for fiscal year 2012 was approved as the deadline to avoid a partial government shutdown passed. In fact, another stopgap measure funding the government at current levels through December 23 was signed by the president as technical details are worked out on the full measure. Brinksmanship apparently is as addictive to policymakers as playing Modern Warfare is to young men, since they can’t seem to get enough of it. The FY 2012 appropriations measure including all nine outstanding spending bills totaling nearly $1 trillion was essentially completed earlier in the week – over two months after the fiscal year began – but, evidently, that was way too soon for legislators, who allowed disputes over offsetting the payroll tax cut and Cuba travel restrictions to delay the spending package. Lawmakers have now created yet another opportunity to get their brink on as the House is threatening to reject a two-month extension of the payroll tax cut and other policies. The payroll tax holiday, expanded unemployment benefits, the Medicare 'doc fix', the AMT patch and various tax breaks like the research and experimentation tax credit all expire at the end of the year. CRFB has outlined a responsible approach to dealing with the expiring provisions, but what fun would that be?
Lieberman Wants Votes – In the wake of the Super Committee failure, Senator Joseph Lieberman (ID-CT) wants to allow bipartisan groups to essentially be their own Super Committee. Lieberman introduced legislation last week which would allow a bipartisan proposal to reduce the deficit by at least $1.5 trillion over ten years to get a vote without amendments. Any such proposal that has at least six sponsors from each party in the Senate or at least 15 from each side in the House will be afforded fast-track consideration. If such a proposal were enacted, it would turn off the sequester due to begin in 2013 that was triggered by the failure of the Super Committee. In a statement, CRFB applauded the bill as a “constructive proposal.”
No Labels Wants No More Dysfunction – The nonpartisan No Labels movement launched the Make Congress Work campaign last week. Two of the 12 proposals in the reform package are directly tied to budget and fiscal policy. The “No Budget, No Pay” proposal would withhold the pay for members of Congress if the appropriations process is not complete when the new fiscal year begins on October 1. It is the only proposal in the package that requires legislation, the others can be accomplished through congressional rule changes, and it has already attracted bicameral, bipartisan support. Sen. Dean Heller (R-NV) introduced the Senate version of the bill and Rep. Jim Cooper (D-TN) sponsored the House version. Another plank in the platform would require an annual fiscal report presented to a joint session of Congress and signed by the president, all members of Congress, and the cabinet.
As the Campaign Heats Up, Principles for Cool-Headed Fiscal Debate Emerge – On Thursday, CRFB re-launched its acclaimed US Budget Watch project to advance an informed, substantive debate on budget and fiscal issues during the campaign season. The nonpartisan initiative offered fiscal responsibility principles for candidates to follow and will also provide objective analysis of the fiscal impacts of presidential campaign platforms.
Budget Process Reform Proceeds – The House Budget Committee on Thursday approved legislation sponsored by Committee Chairman Paul Ryan (R-WI) and Ranking Member Chris Van Hollen (D-MD) to give the president enhanced ability to strike individual items in spending bills. Providing the White House with improved rescission authority was one of the recommendations of the Peterson-Pew Commission on Budget Reform in Getting Back in the Black. Reps. Ryan and Van Hollen spoke at a Capitol Hill forum convened by the Peterson-Pew Commission on Tuesday that highlighted the release of new papers examining multi-year budgeting, fiscal rules, budgeting for emergencies, and performance budgeting. In addition, a bipartisan group of House members introduced their own budget process reform package. The developments came as the Senate rejected two versions of a balanced budget amendment to the Constitution.
Not So Trigger Happy – House Armed Forces Committee Chair Howard McKeon (R-CA) introduced legislation to modify the sequester triggered by the lack of a deficit reduction plan from the Super Committee so that it doesn’t affect the defense budget as much as it currently is set to do. Meanwhile, Rep. Peter Welch (D-VT) led a letter from over 80 House members telling President Obama that the trigger “should not be repealed or amended absent an agreement to reduce deficits that meets or exceeds the amount to be sequestered.” CRFB commended the commitment to the trigger as a means to encourage further negotiation towards a comprehensive deficit reduction deal.
Ryan 'Wyden's Support for Medicare Reform – Rep. Paul Ryan (R-WI) significantly modified his proposal to reform Medicare and attracted support for the new package from Sen. Ron Wyden (D-OR). CRFB called the new plan a welcome addition to the discussion on reforming one of the largest drivers of our long-term debt.
Debt Reduction in the House – In the absence of comprehensive action in Congress, Americans are chipping in. James H. Davidson, Jr. willed his home to the U.S. government when he died last December to go towards reducing the national debt. The government auctioned it off last week for $1.175 million. Davidson also gave an additional $1 million to the federal government to go towards public debt reduction.
Key Upcoming Dates (all times ET)
December 22, 2011
- US Dept. of Commerce releases third quarter GDP at 8:30 am.
December 31, 2011
- The payroll tax holiday, expanded unemployment benefits, the Medicare 'doc fix', the AMT patch and various tax breaks like the research and experimentation tax credit all expire at the end of the year.
January 3, 2012
- Iowa Caucus.
January 7, 2012
- New Hampshire GOP debate sponsored by ABC News and WMUR at 9 pm.
January 8, 2012
- New Hampshire GOP debate sponsored by NBC News, Facebook, and the Union Leader at 9 am.
January 10, 2012
- New Hampshire Primary.
January 16, 2012
- South Carolina GOP debate sponsored by Fox News at 9 pm.
January 17, 2012
- The House of Representatives commences the Second Session of the 112th Congress.
January 19, 2012
- South Carolina GOP debate sponsored by CNN
January 21, 2012
- South Carolina Primary.
January 23, 2012
- The Senate convenes for the Second Session of the 112th Congress.
- Florida GOP debate sponsored by The St. Petersburg Times, NBC News, and The National Journal.
January 24, 2012
- President Obama will give the State of the Union Address.
January 26, 2012
- Florida GOP debate sponsored by CNN.
January 31, 2012
- Florida Primary.
February 4, 2012
- Nevada Caucus.
February 6, 2012
- The President must submit his FY 2013 budget request to Congress by this date.
February 7, 2012
- GOP presidential contests in Colorado, Minnesota and Missouri.
February 22, 2012
- Arizona GOP debate sponsored by CNN at 8 pm.
February 28, 2012
- GOP presidential contests in Arizona and Michigan.