Congressional leaders have announced a bipartisan budget compromise that would fund the federal government for two years and suspend the so-called "debt ceiling" into early 2017. The White House has endorsed the plan. If enacted, the agreement would lift caps on both domestic and defense spending imposed by the 2011-triggered sequester -- one of the few government-reducing achievements of the Republican Congress. These immediate-term spending increases are offset by future cuts and entitlement reforms, GOP supporters say, prompting outgoing House Speaker John Boehner to pronounce the bargain "a good deal," even if it "isn't perfect:"
“Having listened to our members, and listened to the American people, we have a budget agreement. This agreement will protect our economy and reduces the deficit. It secures more long-term entitlement reforms. It strengthens our national security and brings more certainty to next year’s appropriations process. It protects more Americans from ObamaCare and rejects all of the tax increases as proposed by the administration. The agreement isn’t perfect by any means, but the alternative was a ‘clean’ debt ceiling increase without any additional support for our troops and without any entitlement reforms. So this is a good deal for our troops, for taxpayers, and for the American people.”
Boehner's office has released a detailed statement Boehner delivered to the Republican conference today, a piece-by-piece summary of the bill, and the legislative language itself. His strongest argument against those who loathe the agreement:
Under this agreement, the discretionary budget number is $1.067 trillion for FY 16 and $1.070 trillion for FY 17. As Leader McCarthy said last night, those numbers are significantly below the discretionary budget numbers that most of you voted for as part of the 2011 Ryan budget. The discretionary budget number for this agreement is $56 billion below the Ryan budget for FY 16 and $70 billion below the Ryan budget for FY 17. Moreover, these budget numbers for FYs 16 and 17 are STILL BELOW the pre-sequester spending caps outlined in the 2011 Budget Control Act.
On policy substance, GOP appropriators will tolerate the deal, as will national security hawks who've argued for years that hard limits on defense expenditures have hurt the military. Politically, some Republicans will (overtly or secretly) applaud the agreement for effectively clearing the decks for Speaker-in-waiting Paul Ryan. It gets a lot of thorny business out of the way for two years and staves off cliff-style crises that routinely expose tactical divides within the Republican ranks. The only way to enact needed big-ticket conservative reforms is to win the White House, they'll say, and not without reason. Giving Speaker Ryan and Leader McConnell space to pursue a strategic project of conservative governance with an eye towards the 2016 elections -- and with relatively united caucuses behind them -- is smart politics. So is heading off big fights over potential government shutdowns and partial credit defaults, for which the public has zero appetite when push comes to shove, during a red hot presidential election cycle. Boehner finishes off his sales pitch with a debatable warning that the only alternative to this agreement is a clean debt ceiling increase and status quo spending levels. What to make of all of this? I'm inclined to agree with conservative wonk and analyst Philip Klein, who burnishes his credentials as a pragmatist vis-a-vis the institutional constraints of divided government before savaging the pending legislation as the veritable definition of "GOP surrender:"
During the era of House Speaker John Boehner, R-Ohio, it's become popular in conservative circles to blast Republican leadership for surrendering. These charges, in my view, were often not fair. I argued that the debt ceiling had to be raised, government had to be funded, and that it would have been impossible to extend all of the Bush tax cuts following President Obama's reelection. As much as I've opposed Obamacare, I disagreed tactically with Obamacare opponents who believed it would be possible to stop the program without control of the White House through a "defunding" push. In other words, I'm not one to use the term "surrender" loosely. But now that I've had a chance to dig through the details of the budget deal Boehner announced Tuesday morning, I'm comfortable saying: This is what Republican surrender looks like.
Klein builds a withering case, accusing Republican leadership of trading near-term spending spikes for magical spending restraint years from now, and ridicules Boehner et al for rummaging through a "Mary Poppins-like bag of gimmicks" to achieve a patina of fiscal responsibility. Perhaps most cynical is the legislation's extension of sequester-level caps into 2024 and 2025 as a means of partially "paying for" tens of billions in new federal outlays over the next two years. He notes that the Ryan/Murray compromise of 2013 relied on a similar trick, meaning that this deal would represent the second instance of bipartisan majorities jettisoning mandatory spending restraint in the near term by pretending that they'll enforce strict caps a decade hence. "It's pure fantasy," Klein writes. As for the heralded Social Security reforms (the first in decades!), a major element of those proposals simply pushes money from one pot into another, holding off impending insolvency over here by weakening the program's fiscal health over there -- "solving" nothing:
There's more chicanery when it comes to Social Security. The fund that finances the Social Security disability program is expected to run out of money at some point next year. Democrats led by Obama have been proposing diverting a portion of the payroll taxes that are intended to finance Social Security's retirement benefits to help shore up the disability program. "The last thing Congress should do is raid the retirement trust fund," the GOP's own budget, released in March, reads. As Republicans rightly pointed out, when this trick has been used in the past, all it's done is delay the problem and worsen the finances of Social Security's retirement program. But the Boehner deal relies on this kind of reallocation to put off the immediate crisis from 2016 to 2022.
There are some modest reforms within the bill that are worthwhile (Social Security fraud reduction, a pro-business Obamacare tweak, etc), Klein concedes, but they "in no way to those justify" the rest of the deal. His unsparing conclusion, framed from a standpoint of a disheartened supporter of genuine compromise: "I've acknowledged, in the past, that sometimes there's a need to compromise and recognize the art of the possible. But this isn't compromise. This is utter capitulation." Conservative economist Veronique de Rugy concurs, slamming the plan as containing "no pretense of fiscal responsibility whatsoever," snarking that "this surrender makes the French look brave." Dan Mitchell also pans the deal, lamenting that "the only positive thing to say is that this new agreement is not a huge defeat. There will still be budget caps, which is better than no spending caps.
And the new spending, while wasteful and counterproductive, is relatively small in the context of an $18 trillion economy." Bottom line:
Btw Ryan-Murray & Boehner-Obama deals, spending before 2021 has been increased by $143 billion paid for by $98 billion after 2021.— Paul Winfree (@paulwinfree) October 27, 2015
So how will this play out? I suspect most Democrats will follow the Obama/Reid/Pelosi marching orders and support the so-called bargain. Republicans will split, with moderates and defense-minded conservatives voting in favor, and all others voting no. It would not surprise me if a majority of Republicans, especially in the House, oppose the bill -- including Paul Ryan. If the legislation passes, Boehner will have once again broomed the "majority of the majority" rule, relying on Democratic votes to pass legislation. Ryan has promised to reinstate this guideline as Speaker, which may be easier to abide by if these flash points are in the rearview mirror. Parting thought: Is the public really allergic to shutdowns and debt limit standoffs in order to force significant spending cuts? Chew on this data from a fresh AP poll:
The same survey finds that, "56 percent overall said it would be worth a government shutdown to win spending cuts, compared to 40 percent who disagreed." On the other hand, how long would these spine-steeling numbers hold in the face of a sustained fear-mongering campaign from Democrats and the media? When these standoffs actually unfold, they turn out to be very unpopular, with most voters blaming Republicans. And would majority support for "significant spending cuts" endure when specific cuts are proposed?