‘Line’ Items: Back to Work Edition

Back to Work – Labor Day is behind us, but a lot of work lies ahead. Congress returns from its August recess this week with jobs on the top of the agenda, but budget matters are not far behind. Congress must act on the fiscal year 2012 budget before the end of the month and the deficit reduction Super Committee is ramping up its efforts.

Laboring to Control the Jobs Debate – In light of sluggish economic growth, politicians are rolling out the job creation plans to appease anxious voters. GOP presidential candidate Jon Huntsman proposed a plan last week that includes major tax reform that would eliminate tax breaks, simplify the tax code and reduce tax rates. The Huntsman tax plan is very similar to the Zero Plan suggested by the Bowles-Simpson Fiscal Commission, except that the Huntsman plan uses the extra revenue generated by eradicating tax expenditures to eliminate the tax on capital gains and dividends, as opposed to putting it towards deficit reduction as the Fiscal Commission proposed. Read more on tax expenditures here and here. Fellow GOP presidential candidate Mitt Romney will offer his economic plan today after giving a preview in a USA Today op-ed that ran yesterday. President Obama will lay out his jobs plan in a joint address before Congress on Thursday and follow up soon thereafter with a detailed deficit reduction plan that will go beyond the $1.5 trillion the Super Committee is charged with recommending over ten years. It will be interesting to see the net deficit savings the President proposes after the cost of his jobs plan is factored in.

Super Committee on the Job – The Joint Select Committee on Deficit Reduction, otherwise known as the Super Committee, is getting to work. It hired a staff director, Senate Finance Committee staffer Mark Prater, who is known as a tax expert and dealmaker. And it set its first organizational meeting for Thursday and its first hearing for September 13, which will feature testimony from CBO Director Douglas Elmendorf.

It Pays to Be Prepared – September is National Preparedness Month and Americans are urged to be prepared for disasters. In addition to stocking up on batteries and non-perishable food, the national preparedness discussion is increasingly centering on how to pay for the federal response to disasters. With Congress and the White House embroiled in a debate over how to properly budget for emergencies, CRFB called for emergency spending to be offset in a release today, while offering thoughts on budgeting for disasters far in advance in a blog last week.

Appropriations Work Gears Up – The Senate Appropriations Committee plans to mark up three spending bills this week – Agriculture, Energy-Water, and Homeland Security – and set the 302(b) allocations. The 302(b) allocations will be based on the $1.043 trillion cap for 2012 set by the Budget Control Act. The fiscal year concludes at the end of the month and Congress will have to hustle to approve of all 12 spending bills to fund the government before then. Stopgap measures temporarily funding the government seem quite likely.

OMB Updates Projections – The Office of Management and Budget (OMB) released its Mid-Session Review last week with updated budget and economic projections. OMB forecasts that the FY 2011 federal budget deficit will be $1.3 trillion and public debt is projected to be 68.6 percent of GDP. CRFB provided a reaction to the report and some analysis in the Bottom Line Blog (see here and here).

Key Upcoming Dates

September 6

  • Senate back in session.
  • GOP presidential candidate Mitt Romney unveils economic plan.
  • Senate Homeland Security and Governmental Affairs Committee hearing on the budget crisis at the U.S. Postal Service at 2 pm.

September 7

  • House of Representatives back in session.
  • Debate at the Ronald Reagan Presidential Library in California for 2012 Republican presidential candidates.

September 8

  • President Obama addresses joint session of Congress to lay out White House jobs proposals at 7 pm ET.
  • The Joint Select Committee on Deficit Reduction (Super Committee) holds its first organizational meeting at 10:30 am.
  • Senate Finance Committee hearing on "Tax Reform Options: International Issues" ay 9:30 am.
  • Senate Appropriations Committee meets to mark up FY 2012 Agriculture, Energy-Water and Homeland Security spending bills and sets 302(b) allocations at 3 pm.

September 9

  • House Financial Services Committee hearing on exposure of U.S. banks to the European Union debt crisis at 10 am.

September 11

  • Ten year anniversary of the September 11, 2001 terrorist attacks on the U.S.

September 12

  • GOP presidential debate in Florida.

September 13

  • The Super Committee holds its first public hearing at 10:30 am.

September 15

  • House Speaker John Boehner gives jobs policy address to the Economic Club of Washington.

September 22

  • Second GOP presidential debate in Florida.

October 1

  • New fiscal year begins. Legislation fully funding the federal government, or a stopgap measure with temporary financing of government operations, must be enacted by then.

October 11

  • GOP presidential debate in New Hampshire.

October 14

  • Congressional committees must submit any recommendations to the Super Committee by this date.

October 18

  • GOP presidential debate in Nevada.

November 23

  • The Super Committee is required to vote on a report and legislative language recommending deficit reduction policies by this date.

December 2

  • The Super Committee report and legislative language must be transmitted to the president and congressional leaders by this date.

December 9

  • Any congressional committee that gets a referral of the Super Committee bill must report the bill out with any recommendation, but no amendments, by this date.

December 23

  • Congress must vote on the bill recommended by the Super Committee by this date. No amendments are allowed.