Why did they pass the budget resolution anyway?
The Congressional Budget Office's latest report on federal finances, released last Friday, is more important than usual because of the unofficial rules being used to govern this year's budget debate.
In the past, a larger-than-expected surplus would have been of interest but of no real relevance because it was the caps on discretionary spending that determined the amount that could be spent on appropriations. The caps were written into law-the Budget Enforcement Act-and did not change whether the surplus or deficit was higher or lower than anticipated.
This year, however, it is the caps that are irrelevant. It is now the on-budget surplus that determines how much is available for spending increases . . . or tax cuts or debt reduction. As a result, last Friday's CBO report showing a higher on-budget surplus for fiscal 2000 than previously had been anticipated means that this year's budget debate is about as unsettled as it could be.
The $40 billion or more on-budget surplus that CBO now says will occur in fiscal 2000 is causing some in Congress to assume that it will occur again in fiscal 2001 and every year thereafter. This, in turn, has members and staff dreaming about what could be done with the additional imaginary revenues.
Some want it to be used for discretionary spending so that many of the knockdown fights with the White House that almost everyone is anticipating can be avoided.
Others see the additional $400 billion to $500 billion in aggregate on-budget surpluses that result from a simple extension of this year's good news 10 years into the future as the best reason yet to cut taxes.
And still others think that the higher-than-expected on-budget fiscal 2000 surplus should be used to pay down the federal debt. This is especially the case because using the on-budget surplus to pay down debt would be an overall reduction in federal borrowing rather than just a shift from debt held by the public to debt held by the Social Security trust fund.
The fact that the higher 2000 surplus has fired the fiscal imaginations of members of Congress is hardly surprising. What is surprising is how quickly the fiscal 2001 budget resolution conference report, which was adopted barely a month ago, seems to have been forgotten. Minutes after the CBO report was available, representatives and senators who voted for the resolution were calling for significant changes.
The budget resolution was adopted last month not because members of Congress were sure about what they wanted to do but because of the April 15th deadline set in the Congressional Budget Act. In most years that date has not provided enough time for decisions to be made. Ironically, now that Congress has met the deadline two years in a row, there does not seem to be enough information available by April 15th for real decisions to be made.
The April results that are considered so important are available from CBO on a preliminary basis in early May and officially from the Treasury until close to the end of May. If this continues it means that the budget resolution, which essentially is Congress' fiscal plan for the rest of the year, should be considered little more than a draft.
One of the great ironies of this is that while the House is set to consider a major budget process bill this week (H.R. 4397), no one seems to have thought about changing the deadline for passing the budget resolution each year so that it could be done after the April results were in. That would slow down the start of the appropriations process each year, but it is not clear that the decisions made prior to receiving the April results are worth that much anyway these days.
At the very least, changing the deadline would mean that no one would have to ask the question at the top of today's "Budget Battles."
Question Of The Week
Previous Question. Two weeks ago, "Budget Battles" asked its readers to stand up and be counted on whether the District of Columbia should be reimbursed for the police overtime costs it incurred in connection with the World Bank demonstrations. Perhaps it was the fact that it only required a yes or no answer or maybe it was the emotions it generated. But, whatever the reason, more people took the time to answer this question that any other in the history of "Budget Battles." And it was a landslide. A whopping 72 percent said no, D.C. should not be reimbursed. The winner of the "I Won A Budget Battle" T-shirt, who was selected at random from all of the people who responded no, is Randy Cross, a program manager with the Computer Sciences Corporation.
This Week's Question. Here's your chance to win your own "I Won A Budget Battle" T-shirt and be known as the budget guru of your neighborhood when you wear it to go running. Assuming that Congress does not decide to revise the budget resolution it adopted last month, what is the only official job left for the House and Senate Budget Committees in this year's budget debate? Send your response (along with the address to which you want the shirt sent in case you win) to scollender@nationaljournal.com by 5 p.m. EDT on Saturday, May 20. If there is more than one correct response, the winner will be selected at random from the correct entries.
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