House, Senate may be unable to agree on spending caps

If House Republicans can pass their fiscal 2007 budget resolution this week -- and that remains an open question -- some are wondering whether a deal with the Senate is possible.

The House is voting nearly a month later than usual, with a much-shortened legislative calendar this year due to the November elections. The two chambers are $9 billion apart in discretionary spending. And there is recognition that leaders will probably not use the reconciliation process for tax cuts or mandatory spending cuts.

"We [in the House] always pass a budget. We always do. Let's just leave it at that, somehow we get there," said House Republican Conference Chairwoman Deborah Pryce of Ohio, in an interview with CongressDaily. "I can't speculate on whether we'll get together with the Senate or not, or whether we really need to this year. It's obviously preferable, but what we need is the discipline that that bottom line provides us."

That bottom line -- $873 billion in the House version and the president's request -- is making moderates balk at voting for the House budget resolution. The Senate-passed version tops out at $882 billion, with another $7 billion tucked away as "advance" appropriations, a gimmick used to free up money set aside for the following year.

That fact alone has some observers predicting that each chamber might end up operating at their own discretionary spending caps for lack of a budget agreement.

The last time that happened was in 2002, another mid-term election year, when the GOP-controlled House and Democratic Senate could not agree on a budget. The Senate ended up with $9 billion more to spend, and Congress ended up wrapping together 11 appropriations bills in a February post-election omnibus package, after Republicans took back the Senate.

Alternatively, House GOP leaders could "deem" an $873 billion spending cap, which they would likely have to attach to some must-pass bill like the Defense appropriations bill or the emergency war supplemental now working its way to conference. A standalone deeming resolution might face objections from House moderates as well as conservatives, who might instead opt for the lower $866 billion fiscal 2007 spending cap in last year's budget agreement.

After last year's nasty reconciliation fight, some in the party would rather not see a drawn out budget conference. "A lot of people have somewhat written it off already," a Senate Republican aide said. "That might not be so bad. We don't want to get into a big House-Senate fight in an election year, with Republican going after Republican."

The immediate issue for House Republicans and Majority Leader John Boehner, R-Ohio, is to get the budget through that chamber this week. Leaders have promised to act on budget process changes to win over conservatives, while Boehner has floated the idea of allowing moderates more say in how the Appropriations Committee divides the discretionary pie.

But leadership aides say both moderate and conservative factions have shifted their demands throughout the process, making their job more difficult.

After keeping reconciliation instructions for mandatory spending cuts in the single digits, or $6.8 billion, House moderates saw Senate passage of billions in additional discretionary spending as a chance to make a similar statement.

Conservatives are pressing for more earmark reforms that are unpalatable to appropriators. "They each keep moving the goalposts," said one exasperated leadership aide.

Susan Davis contributed to this report.