Budget Process and Rules
Yesterday, CRFB released an analysis of President Obama's new deficit reduction framework meant to save $4 trillion dollars over 12 years. Using CBO's economic and technical assumptions and looking at a standard 10-year period, we find the plan would save $2.5 trillion and would result in a slightly increasing debt-to-GDP ratio toward the end of the decade.
Just in time for Tax Day on Monday, the White House website has launched a taxpayer receipt. By entering what one has paid in federal taxes, the new tool allows users to view where their tax dollars go, with results broken down by category.
The House and Senate today approved of legislation funding the federal government for the rest of the fiscal year, ratifying the agreement reached late last week that averted a government shutdown. For good measure, lawmakers flirted with one more deadline as the “bridge CR” that has been financing government operations since last Friday night’s last-minute deal was set to expire tomorrow.
House GOP Budget Unveiled – On Tuesday, House Budget Committee Chairman Paul Ryan (R-WI) unveiled his fiscal year 2012 budget proposal, titled “The Path to Prosperity.” It is the Republican response to the White House budget released last month. The House Budget Committee will mark-up the bill today in an all-day session with the goal of voting on the House floor next week.
Today Senate Republicans unveiled legislation (S.J. Res 10) to adopt a balanced budget amendment to the U.S. Constitution that has the support of all 47 members of the conference. Republicans had been previously split between two competing versions (S.J. Res. 3 and S.J. Res. 5). The united group will now work on gaining Democratic support. Senate Minority Leader Mitch McConnell (R-KY) wants a vote on the proposal to accompany a vote to increase the debt limit.
In Bloom – Spring is officially here, though the weather would have one think otherwise. Frigid temperatures and even a little snow in the Washington, DC area early Sunday are indicative of how Washington often seems to resist the trends. Yet the inexorable change of seasons is upon us. The snow is already gone and the Cherry Blossoms are blooming. The Cherry Blossoms are a uniquely Washington tradition, drawing tourists by the thousands to experience their beauty and the promise of renewal that they represent.
Everyone can recognize that the budget process is broken, but unfortunately not much has been done so far to fix it. Work such as the Peterson-Pew Commission's report, Getting Back in the Black, offers some great solutions for moving forward. It seems that policymakers may finally be waking up to these ideas. Today we will see two interesting developments that may help build momentum for budget process reform in the near future.
Lots of Stopgaps, Little in Closing the Fiscal Gap – Washington averted a government shutdown last week by agreeing on a two-week continuing resolution (CR) that cuts $4 billion in spending. This is the fifth stopgap measure funding the federal government since the 2011 fiscal year began on October 1, 2010. The posturing and procrastination so far have resulted in little in the way of reducing our mounting national debt.
Last week, the White House released the President’s FY 2012 budget proposal.