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Chambers Far Apart on Budget

Mistrust and disagreement between House and Senate Republicans is leaving many GOP Members worried that the two chambers will be unable to reach an agreement on a unified 2005 budget resolution this year.

Though GOP leaders in both chambers say they aren’t ready to throw up their hands just yet, they express growing concern that the stalemate will keep them from such urgent business as passing an increase in the debt limit this year, as well as approving new tax cuts under the expedited process known as reconciliation.

“If you don’t have a budget, you don’t have reconciliation and you don’t have tax cuts,” said one House GOP Member who is familiar with leadership’s thinking.

And even though House Republicans are privately mulling the potential fallout from not reaching a budget deal, they are loath to discuss such issues publicly for fear of draining momentum from the ongoing negotiations.

Senate Budget Chairman Don Nickles (R-Okla.) said he continues to be optimistic that a deal can be reached. But he suggested that he needs both sides to keep open minds if it is going to happen.

“If people don’t get dug in, we’ll be able to get it done,” Nickles said.

While it’s only been two weeks since the April 15 statutory deadline for a new budget, House and Senate Republicans have been fighting for five and a half weeks about whether to yield to the demands of four Senate GOP moderates who want tax cuts to be paid for with spending offsets, which only a 60-vote majority in the Senate could override.

House Republicans oppose forcing offsets for any new tax cuts in the coming years, while Senate leaders, though like-minded, are hamstrung by their moderates.

Because nearly all Senate Democrats will likely oppose the GOP budget plan, Senate Majority Leader Bill Frist (R-Tenn.) needs at least one of the four moderates — Sens. Lincoln Chafee (R-R.I.), Susan Collins (R-Maine), John McCain (R-Ariz.) and Olympia Snowe (R-Maine) — along with a Democrat or two and possibly Vice President Cheney to get 51 votes for passage.

“If this goes through the month of May, then I think we all really will start to worry,” said one Senate GOP leadership aide. “It’s not holding up these other things — like reconciliation, like appropriations — at this point. … We won’t throw in the towel until we’re absolutely sure we have no alternative.”

House Budget spokesman Sean Spicer suggested that negotiations were still at a relatively early stage given that conferees only had their first official meeting last week.

“We are not feeling as though we’re at that crazy point yet,” said Spicer. “We’re at a very normal point. … It’s a very fluid situation. We’re still at the first-offer stage.”

But the Senate GOP leadership aide said it may take two more weeks to recover from the House’s rejection last week of what Senate GOP aides say was their best opportunity for a deal that could pass the Senate.

The Senate proposal would have set “pay as you go,” or PAYGO, spending rules for three years, while exempting three popular middle-class tax breaks from having to be offset under those rules. The Senate-passed budget included a five-year PAYGO rule. The House budget did not include any such restraints, but GOP leaders initially agreed to a one-year PAYGO compromise before it was rejected by most Senate moderates.

Frist believed the three-year compromise, with the selected tax cut exemptions, could pass the Senate given the implied support of McCain and Sen. Ben Nelson (D-Neb.). The other three GOP moderates opposed the deal, saying they did not want to exempt tax cuts from PAYGO given the government’s soaring budget deficits.

The GOP House Member indicated that his chamber’s refusal was partly based on Senate leaders’ inability to promise that there were actually enough Senate votes for passage.

Indeed, Sen. Wayne Allard (R-Colo.), a Budget Committee member, said Wednesday that Frist needed the House to agree before he could solidify the votes in the Senate.

While lawmakers in both chambers say that the current House and Senate leaders have grown increasingly comfortable with each other over time, some wariness remains, especially among House Republicans.

Just over a year ago, a seemingly solid bicameral budget deal blew apart when House GOP leaders realized that Frist had cut a side deal to pare back tax cuts with some of the same moderates who are holding up action this year.

Then, as now, the tension came over Senate moderates’ desire to lessen the tax cuts’ effect on the budget deficit and House conservatives’ belief that deeper cuts would spur revenue growth.

And while bicameral relations have improved since then, some House Republicans privately say they plan to independently confirm any suggestion from Senate leaders that they have enough votes to pass a budget deal this time around.

“There is still a lingering sense of ‘trust, but verify,’” said a House GOP aide familiar with the negotiations.

Given the frustration on both sides of the Capitol with the entire budget process, some Members believe it might be better to abandon bicameral budget talks and simply use procedures in both chambers that would generally set the total amount of money that appropriators could spend.

“With Republicans controlling the House and Senate and White House, why can’t we control spending?” Chafee asked. “I don’t necessarily agree that we have to have a budget.”

But without a budget, Senate Republicans could not push tax cuts through the reconciliation process, which budget rules protect from filibuster.

And the House would be forced to take a contentious vote on raising the debt limit. A bicameral budget resolution, however, would allow the House to pass the debt-limit increase without a separate vote.

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