Budget Proposal A Return To Compromise, For Better And Worse

The landmark proposal could end the “government by crisis” legislating that has characterized Congress recently.
By @clbtea |
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    WASHINGTON — Much of Washington breathed a brief sigh of relief Thursday evening after the House of Representatives overwhelmingly approved a bipartisan federal budget, the first since April 2009.

    The landmark proposal, which still has to go before the Senate, could end the “government by crisis” legislating that has characterized Congress recently, while simultaneously rolling back damaging federal budget cuts enacted this past spring, at least for two years. Yet for all that, the budget deal remains an odd piece of legislation, a bill with many backers but few friends.

    Across the country, the sense of hollow relief was echoed among the vast constellation of social and “common good” programs dependent on federal funding, from those providing education, health or safety-net services to those overseeing inspections, medical research or infrastructure maintenance.

    “Even before the sequester cuts, a lot of organizations were unable to serve all eligible people. So while this budget is not ideal, it is a step forward,” Joel Packer, co-chair of NDD United, a coalition of 3,200 local, state and national groups deeply impacted by the sequester, told MintPress.

    “For the last three fiscal years, we’ve been moving backwards. Now, this deal turns the corner – it stops us moving backward and starts us moving in the right direction.”

    Following the imposition of across-the-board budgetary cuts known as sequestration this past spring, almost all organizations and programs that receive federal funding have taken severe financial hits. Even if some have been able to cushion their budgets by using saved-up cash, they have still been forced to try to plan for nine more rounds of annual funding slashing.

    Indeed, the next round of sequestration, which this year resulted in an average 5-percent cut across nearly all federal budgets but was far higher for certain programs, was scheduled to begin going into effect as early as mid-January. This was despite near-universal agreement among implementers that they were already having to cut necessary services due to tightened budgets.

    The deal that passed the House on Thursday had been crafted by a bicameral conference led by Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash., since late October. While the Senate still has to take up the issue, for the moment the framework would split the difference between budget proposals made by the Republican-held House and the Democratic-held Senate.

    Critically, the deal specifies both savings and increased revenue meant to accrue over the next decade. This would allow around half of the coming year’s sequester-related budget cuts as well as a quarter of 2015’s to be undone. This would make available around $63 billion dollars in federal funding that otherwise would have been eliminated.

    While exact allocations and priorities will now be decided upon in appropriations committees, roughly half of that additional money is earmarked for defense spending while the rest would be available for social spending, known officially as non-defense discretionary spending, or NDD. NDD United’s Packer, whose coalition is named for this part of the budget, describes this money as providing for “almost all core functions of government”.


    Two-year reprieve

    Since the 2009 federal budget passed, a strikingly polarized Congress has repeatedly failed to agree on how to fund the federal government. This fiscal stalemate has been – and, indeed, largely continues to be – fed by three issues: a wave of far-right conservative victories in the national elections of 2010, antipathy toward President Barack Obama and his perceived agenda, and increasingly strapped government coffers brought about in part by the 2007-08 financial crisis.

    The resulting infighting in Congress and inability to find a way out of the fiscal disagreement led to the idea of sequestration, which would reduce federal spending by more than $85 billion per year through 2021. Made purposefully blind in order to frighten both Republicans and Democrats into compromising, the sequester was meant not as policy but as specter.

    Inevitably, once it actually became law, the sequester’s effects have been tangible in nearly all aspects of life across the country, albeit to varying degrees. Last month, NDD United released a report covering these impacts on day-to-day issues of health, education, public safety, technology, social welfare and dozens of other issues.

    “Historically, NDD represented less than one-fifth of the entire budget, and less than 4 percent of the country’s economy (gross domestic product or GDP). NDD has been cut dramatically and disproportionately in recent years,” the report states.

    “Between fiscal years 2010 and 2011, NDD programs were cut by 7 percent on average, with cuts to some programs deeper than 50 percent … By fiscal year 2017, NDD spending will equal a smaller percentage of our economy than ever before, with data going back to 1962.”

    The federal government also oversees some 655 million acres of land, almost 30 percent of the country’s total, constituting a massive and constantly changing responsibility.

    “From the perspective of public lands, one of the biggest problems with the sequester has been that it has limited the government’s ability to hire seasonal workers, which means firefighters and maintenance workers. The initial cuts were just too steep for public lands agencies, the park service and other agencies, so this new agreement is at least a first step in pushing back,” Athan Manuel, director of lands protection at the Sierra Club, a conservation group, told MintPress.

    “That said, the new discretionary funding levels probably aren’t enough to deal with the problems in terms of fire suppression, a growing maintenance backlog and other issues. The budget agreement won’t actually restore some of the cuts that these agencies have had to enact.”


    Kick the can

    Even if the Murray-Ryan budget were to be approved by the Senate and signed into law, it leaves the sequester in place after 2015.

    Further, it does almost nothing regarding the long-term drivers of US debt, failing to rein in spending on Medicare and Social Security (as Republicans demand) or raise or reform taxes (as Democrats urge). Indeed, these mega-issues were purposefully left off the table by Murray and Ryan in order to try to arrive at some sort of compromise.

    Yet this has led to widespread frustration that Congress is falling back on a traditional habit: refusing to engage with pressing issues and, instead, kicking the can down the road. In the eyes of many, such behavior was a root cause of the recent fiscal impasse in the first place. That has led to significant anger particularly on the far right, where the sequester has been broadly embraced and where lawmakers tried to kill the budget proposal ahead of the House vote.

    “If this deal is enacted, a precedent will have been set, and the big spenders in both parties will sadly gain even more clout going into future budget negotiations,” Chris Edwards, the director of tax policy studies at the libertarian Cato Institute, wrote Thursday. “Blowing through existing budget caps by $45 billion this year could set the stage for spending hundreds of billions of dollars more over the coming decade.”

    Yet the failure of fiscal conservatives to torpedo the budget deal is now seen as having significantly strengthened the more moderate, establishment wing of the Republican Party.

    On the other end of the spectrum, progressives are also frustrated perceived capitulation by the lawmakers with whom they are aligned. Most notably, the deal fails to make good on a key Democratic demand that unemployment insurance, currently set to expire within weeks, be extended for around 1.3 million people. What makes this particularly grating for many is a last-minute change to include a Republican provision ensuring certain payments to doctors.

    “It’s extremely problematic to leave out the unemployment insurance extension – this represents one step forward and two steps back in terms of getting a very weak recovery onto a stronger footing,” Steve Savner, policy director at the Center for Community Change, an advocacy group here, told MintPress.

    “It’s a sad commentary on Congress that part of the deal will apparently include an agreement to make sure cuts in doctors’ pay will not happen while at the same time not addressing the plight of over 1 million long-term unemployed workers who are at risk of losing their unemployment insurance payments. Which side are they on?”

    Others are expressing frustration that social programs are still going to be squeezed despite a significant restoration of the Pentagon’s budget.

    On one hand, many analysts see the final budget deal as a victory for liberals in this regard, given that early iterations of the Murray-Ryan talks sought to repeal the sequester almost exclusively in the defense budget’s favor. But on the other hand, some on the left had earlier embraced the sequester as a problematic but rare opportunity to cut the Pentagon’s bloated budget. They’re now frustrated that, under the new deal, defense spending would constitute slightly more than all non-defense discretionary spending combined.

    “The 51.4 percent [allocated] for the military makes a mockery of the widespread pretence that the nation is broke. No other nation in the world dumps this kind of money into wars and war preparation, while busy honoring Nelson Mandela’s nonviolence or otherwise,” David Swanson, a campaign coordinator with Roots Action, an advocacy group, told MintPress.

    “Loud voices are calling for further cuts, and even louder voices for fewer cuts. It’s amazing to see a government that spends half of its money on good things and half of its money on evil things be lobbied simply to spend more or to spend less … Where is the conversation about choices and priorities?”


    Mainstreamed austerity?

    More broadly, many liberal commentators have suggested that Democratic capitulation on the sequester has ushered in the mainstreaming of a new, Republican-pushed austerity. For months, after all, President Obama had steadfastly refused to endorse any budget proposal out of the House that did not first repeal sequestration. Now, he has embraced the Murray-Ryan framework, which only partially rolls the cuts back and even then for only two years.

    Yet NDD United’s Packer says that the new budget is the result of old-fashioned compromise – at the very least, the way that the federal system is supposed to function.

    “This budget is clearly a mixed bag, but the alternative was either this or nothing, which would have led to a second and third year of the sequester,” Packer said.

    “This also helps because it creates a precedent under which Congress has agreed, on an overwhelming bipartisan basis, that across-the-board cuts are bad policy. Even if we want to reduce the deficit, this isn’t the way to do it – we need to have choices on priorities. Hopefully, moving forward, this won’t allow them to start up again.”

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