House budget chair threatens to hold up Defense supplemental

A clearly frustrated House Budget Chairman Jim Nussle, R-Iowa., on Wednesday told Office of Management and Budget Director Mitch Daniels that he does not intend to adjust the budget to accommodate the additional $18.4 billion in fiscal 2002 defense funding the administration is requesting until the Budget Committee hears directly from Defense Secretary Donald Rumsfeld on the particulars of the request. Nussle said he was concerned that the request focuses more on "playing catch-up" than making a down payment on the strategic review Rumsfeld is conducting. He said, "I do not intend to move on any request from the Pentagon until it is reviewed by this committee."

Several other members were equally frustrated, among them Rep. Mac Collins, R-Ga., who lamented, "When you show up wanting $18 billion more [for defense], it just blows a hole" in the administration's efforts to limit the size of government.

Collins told Daniels, "I suggest you go back down to the other end of the street and come back to us with $18 billion in rescissions" to pay for the increase, which would come on top of the $325.1 billion the budget resolution allocates for fiscal 2002 defense discretionary spending. On the subject of budget enforcement, Daniels recommended setting the fiscal 2002 discretionary spending cap at $679 billion, or the $661.3 billion the fiscal 2002 budget resolution allocates for total spending, plus the $18 billion defense add-on OMB formally requested Wednesday.

Daniels also called for establishing a separate fiscal 2002 cap for Defense at $344 billion, as he explained in his written testimony, "to ensure that this absolutely necessary funding for defense is not diverted to other programs." But in fielding reporters' questions after testifying, Daniels said the administration "would not be amenable" to raising the fiscal 2002 cap to increase education spending. Instead, Daniels said Congress is free to set spending priorities under the cap, saying, "The President is fixed on the totals, [but] will be very flexible about how Congress allocates money within those totals." Daniels suggested Congress could readjust the Appropriations subcommittee allocations to allow more for education than currently assumed in the Labor-HHS subcommittee allocation. In subsequent years, rather than set fixed numbers in statute to extend the caps, Daniels resurrected the budget process reform of making the annual budget resolution a joint resolution that the President would have to sign. Daniels suggested Congress and the White House use the fiscal 2002 cap levels as a "baseline" and determine how they should be adjusted in annual budget negotiations. On the subject of emergency spending, Daniels said the administration is prepared to release more money from FEMA's disaster relief fund if needed to respond to Tropical Storm Allison, and could support additional fiscal 2001 emergency funding for FEMA. Daniels added that OMB remains opposed the House's proposed rescission of $389 million from FEMA's fiscal 2001 budget, and predicted the administration view would prevail in conference.