Line Items: Spring into Madness Edition
Madness Returns – It’s that time of year again. Predictions are made and office pools are formed. Yes, budget wonks are pitting budget against budget to see which will prevail. And we hear there’s a basketball thing going on. Congress is trying to wrap up this week a spending plan for the rest of this year and a budget for next year ahead of a two-week Easter recess. Meanwhile, spring has begun and debate over how to address the national debt continues. Will a debt deal defy prognosticators and make a Cinderella run?
Budgets Take to the Floor – Congress is considering fiscal year 2014 budgets this week. The House on Wednesday considered the budget authored by House Budget Committee chair Paul Ryan (R-WI) as well as alternative budgets proposed by House Democrats, the conservative Republican Study Committee, the Progressive Caucus, the Congressional Black Caucus, and a Republican amendment with the text of the budget drafted by Senate Democrats. None of the alternatives passed and the Ryan budget is expected to be approved on a largely party-line vote on Thursday. Meanwhile, the Senate is planning its first budget vote in four years on the budget drafted by Senate Budget Committee chair Patty Murray (D-WA). Check out our comparison of all the budgets here.
2013 Spending Not One and Done – As Congress tries to adopt a budget for next year, it is still attempting to finalize a spending plan for the rest of this fiscal year. On Wednesday the Senate passed a continuing resolution to fund the federal government through September 30, the end of fiscal year 2013. The bill also provides more flexibility to some agencies for making spending cuts dictated by the sequester. The House is expected to vote on the bill on Thursday. A stopgap measure needs to be enacted before March 27 in order to prevent a government shutdown.
Budget Reform Ready to Come off the Bench – The wrangling over this year’s and next year’s budget is a stark reminder that the budget process is broken. The National Priorities Project has a nice infographic showing the dysfunction of the process. Senators Jeanne Shaheen (D-NH) and Johnny Isakson (R-GA) have reintroduced their bill to institute a two-year budgeting cycle. Check out more budget reform ideas here.
President Brackets Deficit and Economy – The White House came under some criticism for producing a tournament bracket but not a budget yet, which is not expected until April 8. But it did release last week the annual Economic Report of the President. It notes, “As we continue to grow our economy, we must also take further action to shrink our deficits. We don’t have to choose between these two important priorities—we just have to make smart choices.” It also included an analysis of health care spending that we looked at earlier this week.
Deficit Takes the Court at Hearing – On Thursday the Joint Economic Committee of Congress convened a hearing on addressing the national debt. Former Senate Budget Committee chair Judd Gregg testified that, despite progress, more work is still required to rein in the national debt. Former Office and Management director Alice Rivlin argued that policymakers need to address the debt and economy together. Meanwhile, over 160 economists echoed that sentiment in an open letter to the President and congressional leaders.
Corker Wants Grand Bargain in the Big Dance – Over the weekend Sen. Bob Corker (R-TN) said that Republicans could get behind a comprehensive deal that involves entitlement reform and increased revenue through tax reform. “Republicans, if they saw true entitlement reform, would be glad to look at tax reform that generates additional revenues. That doesn’t mean increasing rates; that means closing loopholes. It also means arranging our tax system so we have economic growth.” The comments indicate that President Obama’s effort to court congressional Republicans through meetings could pay dividends.
Furlough Notices Quiet the Crowd – The automatic budget cuts of sequestration will start to hit home as the Department of Defense will send furlough notices to some employees on Friday. Public pressure as the effects of the sequester are felt may prompt policymakers to finally agree on a smart, comprehensive deficit reduction plan that is phased in over time to replace the sequester.
Tax Reform Looks to Move On – Fundamental tax reform continues to move forward, with House Ways and Means Committee chair Dave Camp (R-MI) saying that the deduction for state and local taxes could be ripe for change.
Key Upcoming Dates (all times are ET)
- Current continuing resolution (CR) funding the federal government expires.
- Bureau of Economic Analysis releases third estimate of 2012 4th quarter and annual GDP.
- Dept. of Labor's Bureau of Labor Statistics releases March 2013 employment data.
- Congress must pass a budget resolution as specified in the Congressional Budget Act. Also, due to the debt ceiling suspension bill, lawmakers will have their pay withheld after this date until their respective chamber passes a resolution.
- Dept. of Labor's Bureau of Labor Statistics releases March 2013 Consumer Price Index data.
- Bureau of Economic Analysis releases advance estimate of 2013 1st quarter GDP.
- Dept. of Labor's Bureau of Labor Statistics releases April 2013 employment data.
- Dept. of Labor's Bureau of Labor Statistics releases April 2013 Consumer Price Index data.
- The debt limit is re-instated at an increased amount to account for debt issued between the signing of the suspension bill and this date. After re-instatement, the Treasury Department will be able to use "extraordinary measures" to put off the date the government hits the debt limit potentially for a few months.
- Bureau of Economic Analysis releases second estimate of 2013 1st quarter GDP.