The House's Budget Enforcement Resolution
As expected, the House came out today with its "budget enforcement resolution." What's the difference between a budget enforcement resolution and a traditional budget resolution? A lot of things, as it turns out.
The one blatant difference is that this resolution only applies to the House, whereas the typical concurrent budget resolution applies to both chambers. The Senate has yet to pass a counterpart resolution, although the Senate Budget Committee passed a budget blueprint in April. Another difference is that a typical budget resolution sets out spending and revenue levels for the next five years, as did the resolution adopted by the Senate Budget Committee. But the House resolution only deems the spending level that the Appropriations Committee must follow for one year. Setting out multiyear spending and revenue levels are essential to dealing with the medium- and long-term fiscal imbalances.
Granted, the resolution does set out a few medium-term goals, one good one and one extremely vague one. The former is the adoption of the White House fiscal commission's goal of primary balance (revenues equaling spending excluding interest payments) by 2015. The latter states that "the debt-to-GDP ratio should be stabilized at an acceptable level once the economy recovers." Of course, there has already been and will continue to be plenty of debate about what an "acceptable level" is and there is no date specified as to when this should be accomplished by. Once again, the lack of outyear budget numbers also hinders the ability to create a path to reach these goals.
On a side note, the resolution also states that the recommendations of the fiscal commission would be brought to a vote before the House and that any recommendations enacted would specifically be used for deficit reduction. This codifies the commitment House leaders have already made.
But overall, the relative lack of teeth of the resolution and lack of multiyear planning shows why passing a real budget resolution is needed. Without it, lawmakers will have a harder time finding a path back to fiscal responsibility. This underscores the need for a comprehensive fiscal plan now to implement as the economy recovers as well as budget process reforms to ensure that the plan stays on track.