Congress is finally moving on a federal budget, but lawmakers need your help to show them how to do it right.
Six months after the statutory deadline was missed and after the new fiscal year has already begun, Congress is finally poised to pass a federal budget. But instead of helping to get the national debt under control, it could pave the way to add even more to the unsustainable situation.
The House of Representatives passed a federal budget for fiscal year 2018 on October 5 largely along party lines, a few days after the fiscal year began on October 1 and well past the April 15 deadline under the law. On the same day, the Senate Budget Committee approved of a budget on a party-line vote that is due for a full vote in the Senate the week of October 16.
Although it is good to see the budget process finally moving, the new budget could very well move the national debt in the wrong direction. Our partners at the Committee for a Responsible Federal Budget addressed the two budgets in a statement.
For all the years of GOP lawmakers calling for balanced budgets, at least on paper, the House budget would reach balance, while the Senate budget would not.
The House also expedites an important down payment on deficit reduction by calling for over $200 billion in spending cuts from reconciliation. That’s not enough, but far more than the Senate’s minimum target of $1 billion in savings. Yes, one.
The House budget also expedites tax reform that does not add to the debt – the clearly stated past goal of the President's budget, Republican leaders, and the White House – while the Senate budget allows for $1.5 trillion in additional borrowing. (Just to restate that, the Senate would allow $1.5 trillion in tax cuts and asks for only $1 billion in spending cuts.)
Both budgets rely on vastly overstated economic growth numbers, but the Senate budget includes those assumptions in a way that will actually make the debt worse.
No independent economist or forecaster anywhere is predicting the kind of sustained economic growth that would be necessary for tax cuts to be self-financing, and Congressional leaders should not be banking on it as policy. In fact, tax cuts that add to the debt will suppress economic growth, not unleash it.
If the current Senate GOP budget – or anything close to it – becomes our fiscal roadmap, no person supporting it will be able to claim to be a fiscal conservative or supporter of fiscal responsibility.
The House budget, on the other hand, paves the way for more responsible, revenue-neutral tax reform accompanied by at least some mandatory spending reductions that are a down payment on fiscal responsibility.
If lawmakers are unwilling to pass a budget that would truly put our debt on a downward path and address both tax and major entitlement reform, Members of Congress should at least reject adding trillions to the national debt on massively exaggerated promises of economic growth and take an approach that more closely resembles the House budget.
Congress is finally moving on a budget because it is necessary to have one in order to pass tax reform under budget reconciliation rules that avoid a filibuster in the Senate. Senator Bob Corker (R-TN) summed up the current state of the federal budget. “Look, the budget itself is always a joke. It’s a total joke. It’s not worth the paper that it’s written on. This is a vehicle to begin a debate on tax reform.”
The federal budget process has become increasingly dysfunctional. Even when a budget is agreed to, the appropriations process and other government spending and tax decisions often ignore it. Senator Sheldon Whitehouse (D-RI) recently expressed this reality. "Nobody gives a hoot about our budget. The appropriators blow right through it."
The budget and spending process is failing us. As autopilot spending is out of control. As a result, budget deficits and national debt are set to explode in the coming years. Unpaid-for tax cuts will only make the situation worse.
Now, you can show Congress how to create a responsible federal budget that helps to fix the debt with the Debt Fixer interactive federal budget tool. You can make many of the same spending and tax choices that lawmakers face and see how they affect the national debt. Then you can share your results with your representatives.
So, take a look at what the federal budget currently looks like. And learn what you need to know about the budget. Then use the Debt Fixer to get us moving in the right direction.
National Debt and You