Please pass the surplus

Here a few tasty budget tidbits for you to devour:

The Real Endgame Is Appropriations

House and Senate Republicans will undoubtedly be in a self-congratulatory mood later this week if, as the leadership is hoping, both houses of Congress manage to pass their versions of the fiscal 1999 budget resolution before the start of the Easter/Passover recess. And they are likely to be downright giddy if, again as the leadership is hoping, the House and Senate manage to pass exactly the same version of the budget resolution and avoid a conference committee.

To a certain extent, they will deserve this political version of an endorphin rush. This would only be the second time in history that a congressional budget resolution would have been adopted by the April 15th deadline, and it would certainly be a substantial change from last year when Congress failed to agree on any budget resolution at all.

Regardless of when the resolution is done, however, Congress will still have to face the reality that because it has passed a budget, the White House will not have to negotiate.

That is one of the biggest differences between deficit politics and surplus politics. Doing nothing when there was a projected deficit was unacceptable because the potential result was a deficit -- something the political system defined as bad. But doing nothing when a surplus is anticipated means there will be a surplus -- and that is what Federal Reserve Board Chairman Alan Greenspan and the polls say is the preferred policy this year.

If there are negotiations, they are far more likely to occur on appropriations. With Congress wanting to avoid even a mention of a government shutdown, waiting until the last minute to negotiate would give the administration the upper hand.

This Year The Magic Number Will Be 67, Not 60

A budget resolution conference report will be important because it will allow a tax cut to be considered as a reconciliation bill. That means no filibuster, as reconciliation bills in the Senate can only be debated for the statutorily fixed amount of time. So only a simple majority will be needed in the Senate instead of the 60 votes that would otherwise be required.

But while the leadership may be able to avoid this supermajority requirement that was so unattainable last year, they will not be able to avoid the two-thirds vote that will be needed in both houses to overturn what could be a virtually inevitable presidential veto.

A Tax Bill? When?

Senior House Ways and Means and Senate Finance Committee staff have been telling various groups over the past few weeks that their committees are not likely to move a tax bill until they get an updated surplus forecast from the Congressional Budget Office. CBO Director Dan Crippen has been saying that the January forecast now looks a bit timid and that his mid-session update could show the fiscal 1999 and 2000 surpluses being considerably higher. The tax-writing committees are looking at this update as the way to pay for bigger tax reductions than the budget resolution assumes.

But the CBO updates will probably not be available for several months. In fact, CBO technically is not required to provide an update until August. While no one expects Crippen to wait that long if he is sure about better-than-previously forecast numbers, he will almost certainly have to hold off updating his projections until the actual results for April -- the most important month for individual income tax collections -- are available in late May. That means that the committees might not get started until June at the earliest.

Has Anyone Checked The Budget Laws Lately?

Even if CBO updates its numbers later this year, the current pay-as-you-go rules still do not allow surpluses to be used for anything other than reducing the national debt. A surplus rather than a deficit -- or a higher-than-expected surplus -- does not turn off these rules.

And Congress cannot easily change these rules by itself. The underlying statute -- the Budget Enforcement Act -- would have to be changed, and that will require legislation signed by the president or an override of a veto. Although the plan seems to be to include the BEA change in the tax cut legislation itself, both of these seem unlikely at the moment.

The Budget Countdown

As of today there are only 11 potential legislative days left before the April 15 statutory deadline for passage of the fiscal 2000 congressional budget resolution. If Mondays and Fridays, when the House and Senate typically are not in session, are excluded, there are only nine days.

Question Of The Week

Last Week's Question. Is there a David Stockman retrospective going on that I didn't know about? Last week's question, which asked you to name the state that Stockman's district was in when he was a member of the House of Representatives, resulted in the biggest number of responses ever to any Budget Battles question of the week and the largest percentage (95+) of correct answers. Even though there were no bonus points or extra credit, it also produced the largest number of people who felt the need to provide additional information, everything from the number of the district Stockman represented, to the people who succeeded him in Congress, to his complete bio.

The correct answer is Michigan. Because of the large number of entries, three winners of the much coveted and always stylish "I Won A 1999 Budget Battle" T-shirt were chosen at random from the correct responses. They are Bill Dolbow, legislative director for Rep. Tom Bliley, R-Va.; Brad De Long, an economics professor at the University of California, Berkeley; and Rick Werner, from the budget office of the Department of Health and Human Services.

This Week's Question. Here is another opportunity for you to win your own "I Won A 1999 Budget Battle" T-shirt, either to wear or to wash the winter grime off your car. Who was the last representative or senator to serve as director of the Office of Management and Budget? Send your response to scollender@njdc.com. If there is more than one correct response, the winner will be selected by random drawing.