Proposals Fall Short on Budget Process Reform

Blog Post
Monday, November 19, 2018

Amid bipartisan frustration over the federal budget process, Congress early this year created a special committee to develop reforms that could enable lawmakers to pass spending bills on schedule and in a more effective and thoughtful manner.

There were high hopes that the eight Democrats and eight Republicans on the committee would present sweeping recommendations.

As the committee chairs unveiled draft legislation last week, however, it became clear that the panel had failed to reach agreement on many substantial recommendations.

The most notable change would be to switch the budget process from an annual to a biennial cycle, which could have some positive benefits.

But despite months of hearings and discussions among themselves, committee members were unable to reach agreement on the broader recommendations for which many lawmakers, deficit hawks and others had hoped -- a point made by some committee members themselves.

Rep. John Yarmuth of Kentucky, the ranking Democrat on the House Budget Committee, called the joint committee’s proposals “incremental” and suggested they would “help a little bit.” Faint praise indeed.

Sen. James Lankford (R-Okla.) was even less enthusiastic, issuing a press release saying that the $21 trillion federal debt called for “significant reform, not just tweaks around the edges.”

On Thursday the joint committee met to review proposed legislation that had been prepared by the panel’s co-chairs, Rep. Steve Womack (R-Ark.) and Rep. Nita M. Lowey (D-N.Y.). The committee accepted three proposed amendments and rejected a number of others.

Yet there was no final vote, and even the joint committee’s modest, bipartisan proposals face uncertainty in the weeks ahead.   

On Thursday the committee suspended its markup session on the legislation until Nov. 27, only three days ahead of its deadline to report a bill to Congress.

The panel is apparently still struggling with internal disagreements and seemed to bog down in confusion over possible impacts on the complex budget procedure known as “reconciliation.”

In addition, Lowey wanted Senate leaders to reach an agreement on how the legislation would be handled in the upper chamber.

As The Concord Coalition said when the special committee began meeting in March, there is certainly room for improvement in the current budget process.

Year after year the process has broken down, with Congress failing to make final spending decisions for each fiscal year until well after that year has started.

Facing possible government shutdowns, Congress passes one or more stop-gap measures that generally continue federal spending at previous levels -- regardless of changing circumstances and shifting priorities -- as lawmakers continue to struggle with final funding decisions.

Falling back on these “continuing resolutions” fosters government inefficiency and costs taxpayers money.

This messy process is currently on display once again, with the latest continuing resolution set to expire Dec. 7.

The Concord Coalition has long supported the idea of biennial budgeting, a subject on which our executive director, Robert L. Bixby, has testified on Capitol Hill.

Replacing the annual budget cycle with a two-year process is no panacea. But it would likely be more efficient and would give lawmakers more time to focus on oversight and possible solutions to the country’s difficult mid- and long-term fiscal challenges.

But many other changes are needed.

For example, Pay-As-You-Go rules should be strengthened so that advocates of spending and tax-reduction proposals are required to find responsible ways to pay for them rather than simply boosting the deficit over and over again.

The “reconciliation” process, which can be used to avoid Senate filibusters, needs repairs so that it cannot be misused to boost federal deficits.  

Another problem with the current budget process is the federal debt limit. In its current form, this limit has obviously failed to impose fiscal discipline. Instead it has become a tool for partisan bickering and fiscal brinksmanship that could destabilize global financial markets.

If we are to have a debt limit, it should be linked in a meaningful way to the fiscal policy decisions that create the need for additional federal borrowing. No one should be allowed to use the debt limit to threaten defaults by the U.S. government on financial obligations it has already incurred.

In a column last week in The Hill, Womack wrote that while nobody on the special committee got everything they wanted, Republicans and Democrats “found consensus to move the ball forward” in certain areas. On a somewhat defensive note he added: “That, in my mind, is a win.”

We’ll soon see whether the ball has indeed moved forward. But in any case, as the federal debt continues to rise, the next Congress will clearly need to do more.