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The Return of the Budget Committee Jedi

Friday’s very discouraging unemployment report, which showed that 651,000 jobs were lost in February, could make the House and Senate Budget committees far more important and powerful than they have been in decades. If it happens, this would be a shock to the system roughly akin to what fans of “Star Wars— (the movies, not the missile-defense system) would call a “disturbance in the force— as the Budget Committee Jedi return to prominence.

[IMGCAP(1)]For a good part of their almost 35-year history, the Budget committees were ignored or forgotten. Especially during the George W. Bush administration but at other times as well, the committees produced budget resolutions that many Representatives and Senators wouldn’t support. This meant there were many times when the annual budget resolutions — the committees’ one actual annual legislative responsibility — weren’t adopted.

Rather than push to get them done by forcing the House and Senate to take politically difficult votes, the leadership usually disrespected the Budget committees by finding ways around the rules so that the resolutions weren’t needed. This allowed the appropriations process, which is supposed to be put on hold until the budget resolution conference report for the coming year is in place, to proceed. In those years the Budget panels did little more than watch in silence.

This year could be very different because the Budget committees are the only ones with the specific responsibility for doing what now needs to be done: Look at the big economic picture and recommend policies to deal with it.

The fact that it’s the Budget panels’ job to look at the big economic picture is not an accident. In fact, it was one of the compromises needed to get the Congressional Budget Act adopted in 1974.

As the bill was considered, many of the other committees that were involved in some way in spending and taxing and, therefore, in budget decisions, were worried that a new Budget Committee would usurp their jurisdiction. They were concerned that the Budget committees would become what some said would be “super committees— that would determine the budget and then put together the specific spending and taxing policies to implement them. That was a deal-breaker for committees such as Appropriations, Finance, and Ways and Means that saw their own power being greatly diminished if what the Budget panels did was not limited.

This was handled in several ways. For example, a number of members of the House Budget Committee were required to be members of the Ways and Means and Appropriations committees so the views of those panels were always known and presumably taken into account. But the most important arrangement was that the Budget committees’ jurisdiction was limited so that would only look at the big picture — the overall economy, total spending and revenues, deficit or surplus, national debt, etc. The program and line-by-line decisions assumed in the budget resolution were left to the other committees to implement.

Few think about this limited Budget Committee role in a typical year when the economy is growing by average amounts and a large adjustment in fiscal policy isn’t warranted. But this isn’t a typical year: The economy is contracting rather than growing and the contraction is anything but run-of-the-mill. As a result, something more than an incremental policy change is needed.

Until Friday, the assumption was that the fiscal 2010 budget resolution would mostly reflect the spending and taxing decisions already made this year. It would include the impact of the stimulus bill enacted last month, the administration’s mortgage plan and what is being done to deal with the other financial services issues affecting the economy.

But last Friday’s unemployment report seems to have changed everything. Not only did the very large drop in jobs almost immediately increase the calls for far more federal involvement in the recovery effort, the calls came from a much broader audience.

This is why the House and Senate Budget panels are now in the best position in years to play a major role in economic policymaking. Because of decisions that were made more than three decades ago, the budget resolution is supposed to be the one place all year where Congress does what now needs to be done: taking a look at the big economic picture and making adjustments to deal with it. Given the deterioration in the economic outlook that has been recognized in the past few weeks, the committees can take the lead in the debate by recommending a budget resolution with additional fiscal policy changes.

There are few times in the history of the Congressional budget process when the Budget committees have been so much in the right place at the right time. Unlike the situation in many other years, the perceived need for action is coming after the president’s budget was submitted, after a stimulus bill was signed into law and before the budget resolution has been considered. That makes the budget resolution and, therefore, the Budget committees, the next best opportunity for something to get done.

In addition, there is a statutory limit on the debate on a budget resolution in the Senate. Therefore, the committees are able to provide something that no other panel can do by bringing a bill to the floor that can’t be filibustered.

The big question is whether, after so many years of not being in the center of the economic debate — that is, being in the political equivalent of a galaxy far, far away — the Budget committees will be willing and able to make this happen. But with the moon, planets and stars all aligning properly for them, it seems like the perfect time for the committees to exercise the power they have while we hope that the force is with them.

Stan Collender is managing director at Qorvis Communications and author of “The Guide to the Federal Budget.— His blog is Capital Gains and Games.

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