Background: In 2011, Congress and President Obama agreed to raise the debt ceiling in exchange for cuts to the federal spending totaling $917 billion over the next 10 years. The agreement dubbed the Budget Control Act of 2011 (BCA), has been a key tool to limit discretionary spending in the midst of exploding deficits and runaway federal spending. Unfortunately, ever since there has been a bipartisan push to increase the BCA caps to allow higher spending.
In late 2015, as part of then-Speaker John Boehner’s efforts to “clean out the barn,” Congress passed the Bipartisan Budget Act (BBA) breaking the spending caps established under the BCA by $50 billion in fiscal year 2016 and $30 billion in fiscal year 2017.
The Purpose of a Budget: The annual budget process is Congress’ chance to set its own vision for the nation’s finances — a conservative vision reduces the size and scope of the federal government. It is an opportunity to set a new course and not continue to ratify the excessive spending of the past. Passing a budget for its own sake, regardless of spending levels, is neither conservative nor fair to the people who elected them to office. Conservatives should not simply rubber stamp a bad budget.
Conservative Priorities: At the end of last year, 167 Republican members voted against the BBA spending levels and 95 voted against the trillion dollar “omnibus” bill. Those same members are now being asked again to keep the higher spending levels in place for fiscal year 2017, even with a new Speaker. Conservatives should insist on the following priorities:
- Keep top-line discretionary spending levels previously established under the BCA of 2011.
- Balance within ten years without accounting gimmicks we have seen used in the past.
- Eliminate Obamacare revenues from being counted towards balancing the budget, as the law should and must fully be repealed under a Republican President in 2017.
- Explicitly reaffirm support for premium support in Medicare and other policy reforms.
Claim and Response
Claim: Returning to “regular order” appropriations bills should be our focus. This cannot occur without a budget.
Response: This is not true. Congress can and has considered appropriations bills in the past without an agreement between the House and Senate. Each chamber could “deem” its own budget.
Claim: Passing a budget at higher spending levels will allow conservatives to devote a larger focus to passing significant policy reforms.
Response: While many policy proposals would likely be included in any budget, Congress does not need a bad (or any) budget agreement to consider stand-alone policy reforms such as tax reform or welfare reform.
Claim: The budget does not rely on the revenues from Obamacare. It merely assumes the same amount of revenue under current laws and that any changes to tax policy will be “revenue neutral.”
Response: While Obamacare may be the law of the land, Republicans in Congress and those running for the White House have repeatedly promised to repeal it in 2017. With this in mind, Republican budgets in the past have correctly scrapped Obamacare spending, but mistakenly kept Obamacare’s $1 trillion dollars of revenue in order to balance the budget. Republicans get away with this gimmick by claiming future changes to our tax policy will be “revenue neutral” without explaining how that will happen. In other words, they are arguing if Congress votes to cut Obamacare taxes in repeal then they would have to raise revenue somewhere else. In this year’s budget, conservatives must insist on a balanced budget that truly balances, without using Obamacare gimmicks.