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Don’t Be Fooled: Budgetary Meltdown Inevitable

Spending debate starts, but standoff over $30 billion sliver likely to last until after the election

Copies of President Barack Obama's fiscal 2017 federal budget are seen at the U.S. Government Publishing Office. (Photo By Al Drago/CQ Roll Call)
Copies of President Barack Obama's fiscal 2017 federal budget are seen at the U.S. Government Publishing Office. (Photo By Al Drago/CQ Roll Call)

Members of Congress are regularly coming up with special bits of snappy lingo for short-handing the big issues of the moment – from the “fiscal cliff,” for all the tax and spending deadlines that coincided after the last presidential election, to the “doc fix,” the Medicare formula for paying physicians rewritten last year.  

The newest coinage, just in time for this year’s slow-moving but seemingly inevitable budgetary meltdown, is “the 1070 number.”  

The most conservative House Republicans say they can’t live with it. Everyone else has concluded the federal government can’t live without it.  

The reference is to $1.07 trillion. That is said aloud as “one trillion and seventy billion dollars” off Capitol Hill but has been dubbed “the ten seventy number” by the congressional players on each side of this year’s spending standoff. No matter how you pronounce it, though, the amount is the legal cap on discretionary spending for fiscal 2017, the budgetary year beginning in October.  

Starting this week, it may seem as though Congress is genuinely in pursuit of continued regular operations for the government without any shutdown, showdown melodrama.  

On Wednesday, the House Appropriations Committee is going to approve its first measure of the year, the politically protected package for veterans’ programs and military construction, and the next day, Senate Appropriations will do likewise, advancing the similarly anodyne legislation covering civilian Energy Department spending and the Army Corps of Engineers.  

More importantly, the two panels will endorse a spreadsheet of spending totals for all 12 of the measures they’re supposed to produce each year –- and, in both cases, the Republican realists who are in control of the committees will make sure their sums add up to $1.07 trillion.  

All that action is actually slightly ahead of schedule, by modern standards, helping further the impression that the long-broken appropriations system may be getting back on track. That illusion could be sustained into the summer.  

With precious little else on the GOP majority’s election-year agenda — because debating new federal policies or high-profile nominees appears out of the question – going through the motions on the appropriations bills looks to be the best way for leadership to give the rank-and-file a way to mark time, especially on the Senate floor.  

But all the while, passive-aggressive resistance to “the 1070 number” will continue to build — especially among the three dozen or most combative, small-government conservatives in the House, who still hold a pivotal position of power.  

Republicans can’t pass legislation without them in cases when the Democrats are united in opposition. That’s why the House has all-but-officially canceled debate on the annual budget resolution, which would symbolically reaffirm $1.07 trillion as the ceiling for the coming spending cycle.  

And the Democrats are going to form a steadfast bloc of minority resistance to the House appropriations bills, especially for domestic and social programs — not only because party members generally favor more generous spending levels but also because they delight in watching the GOP sweat through its intramural squabbles.  

The coming weeks of pretending that it’s business as usual will not be totally pointless. With every step a spending bill takes toward completion, hundreds of small-bore decisions about the priorities of departments and agencies advance toward finalization.  

Only the really big-ticket and polarizing items get left on the table until the final negotiations. Whatever package gets negotiated in the end, in other words, will reflect to a very large extent the line-item deals made in committees or on the floor.  

But before the big finish can be envisioned, Congress will have to either appease the budget hawks — or else defeat them decisively.  

The fight, it must be emphasized, is not over addressing some existential threat to Republican orthodoxy. On the contrary, those who don’t fancy “the 1070 number” have fixated on “the 3 percent solution.”  Under a law enacted less than six months ago, the $1.04 trillion total permitted for the current fiscal year may increase $30 billion, actually a shade less than 3 percent, for next year.  

The GOP mainstream argues that, as a matter of political practicality, it’s pointless to ask Congress in an election year to appropriate less than an inflationary increase overall. And it’s unfair to expect the government to maintain current services with less, they say, even after appropriators pick some winners and losers among federal programs.  

They view the extra $30 billion (awarded equally to military and domestic enterprises) as just enough grease to get the budget gears moving normally but not enough to leave the Obama administration with a fat and happy feeling in its final months.  

The hard-liners, at the same time, are digging in on symbolism more than revolutionary substance. They’ve given up the dramatic talk of the tea party years about closing whole departments and otherwise dramatically shrinking the federal government’s footprint. All they want now is to freeze spending for the next year, which they could sell as emblematic of their zeal for confronting rising deficits wherever possible.  

Of course, this entire tiff is only about a relative rounding error in the one-quarter of the federal budget over which Congress has annual control through the appropriations process. Two-thirds of the outlays are for mandatory programs, with Social Security and Medicare by far the biggest drivers. The rest is interest payments on the debt.  

This winter, GOP leaders promised that, in return for sticking with “the 1070 number,” the House would advance a package of $30 billion in offsetting cuts to health and retirement entitlements. Conservatives rejected the idea – on the very safe assumption that, while the spending would go up, the truly difficult budget cuts wouldn’t ever become law just before a national election.  

The political dynamics and fiscal realities were different in the past two presidential election years, but for the budget the end result was the same as the predictable outcome for 2016: Congress punted the appropriations debates so far beyond Election Day that the spending decisions due in both the fall of 2008 and the fall of 2012 were made after the subsequent inaugurations.  

Many Hill Republicans were saddened on Tuesday when Speaker Paul D. Ryan made an almost irreversible “count me out” declaration about being drafted as their party’s compromise presidential nominee. But when it comes to the post-election budget scrum, he’ll absolutely need to be counted in – and he’s the most powerful proponent of “the 1070 number.”  

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