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Negotiators Consider $200 Billion in Spending Increases

  • House (235-193) and Senate (81-14) on Thursday, 12/7, passed (HJRes 123) to continue funding through Dec. 22 and provide a short-term extension for the expired Children's Health Insurance Program. President signed the CR on Friday, 12/8.
  • Congress and the Administration must now reach bipartisan agreement on new FY 2018 amd 2019 spending limits for defense and non-defense discretionary (NDD) spending and bring all 12 appropriations in line with those limits.
  • CQ/Rollcall reports congressional negotiators are considering increases in defense and NDD spending amounting to more than $200 billion over two years.  Congressional GOP negotiators had initially offered to raise defense by $54 billion and NDD nondefense by $37 billion in both fiscal FY'18 and FY'19 — a $182 billion increase in base discretionary spending over the current statutory spending caps. However, Democrats are insisting on parity between defense and NDD, raising both by $54 billion in each of the two years.  And some Republicans want even higher increases in defense, as much as a $70 billion increase in FY'18, closer to the $77 billion authorized in the FY 2018 Defense Authorization Act, HR 2810).  Higher defense levels will inevitably lead to higher NDD levels.
    • Current FY'18 Caps: Defense/549;  NDD/516
    • Initial GOP Offer:      Defense/603 (+54);  NDD/553 (+37) in FY'18 and same increases in FY'19
    • Dems Want Parity:   Defense/603 (+54);  NDD/570 (+54)
    • Some GOP Want Higher Defense:  Defense/619 (+70)
    • Defense Authorization Act: Defense/626 (+77)
    • Note: Defense war funding (known as the Overseas Contingency Operations "OCO" account) is "off-budget" and is added on top of the base amounts described above.
  • Other Items that Could Be included in the Omnibus Spending Bill:
  • Outlook/Timing:  the new budget caps could be enacted as an amendment to the next CR when the current one expires Dec. 22; appropriators would then make adjustments to the pending 12 appropriations bills to bring them in line with the new levels and pass the bills as an omnibus FY'18 bill in January.  Possible outcome could be defense increase in the range of $60-$70b and NDD increase of $50-$60b.
  • Dec. 4, 2017 Democratic Statement on priorities for spending negotiations.
  • Current CR (HJRes 123)
  • FedWeb Appropriations Portal
  • Background on extending DACA (deferred action for childhood arrivals), one of the key hurdles to reaching agreement
Debt: Tax Bill Pushes Debt Toward 100% of GDP; Debt-Ceiling must be raised by March or early April  Tax Bill: House-Senate conference    Health Programs
  • Big Entitlement and Low-Income cuts in 2018: Speaker Ryan said on Dec. 6, "We're going to have to get back next year at entitlement reform, which is how you tackle the debt and the deficit," signaling a renewed effort to make deep cuts in Medicare, Medicaid and other entitlements.  This is contrary to the promise of Candidate Trump in June 2015 to “save Medicare, Medicaid and Social Security without cuts. Have to do it.”  “I was the first & only potential GOP candidate to state there will be no cuts to Social Security, Medicare & Medicaid.” Trump tweeted in May 2015.
  • Partial ACA Repeal in Tax Bill: Senate tax bill would effectively repeal the Affordable Care Act (ACA) individual mandate.  According to a CBO/JCT analysis, the repeal would decrease the number of insured Americans by 4 million in 2019 and 13 million by 2027, and average premiums in the nongroup market would increase by about 10 percent.  To address these effects, Sen. Collins R-ME is seeking passage of the Alexander-Murray and Collins-Nelson bills; however, CBO said in an 11/29 analysis that passage of Alexander-Murray would not mitigate the impact of repealing the individual mandate; and a CBPP analysis finds that "while the Collins-Nelson proposal is a sensible standalone measure, it would come nowhere close to undoing the damaging effects of repealing the mandate."
  • Tax Bill Triggers Medicare cuts: Deficit increases in the tax bill would trigger automatic reductions in Medicare under the PAYGO statute.
  • Will CSR Payments Continue?  ACA cost-sharing reduction (CSR) payments will end in 2017 unless Congress adopts some form of the Alexander-Murray Bipartisan Health Care Stabilization Act of 2017.  Allowing expiration of the CSR payments is estimated by CBO to destabilize health insurance exchanges, increase premiums, and increase federal deficits by nearly $200 billion.
  • CHIP and Community Health Centers Funding in Jeopardy:  Congress must act to reauthorize the expired Children's Health Insurance Program (CHIP) and the Community Health Centers Fund.
  • See our new webpage on federal disabilities programs.
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About Charles S. Konigsberg and the Federal Budget Group LLC
Charles Konigsberg

Charles Konigsberg, President of the Federal Budget Group and Founder of FedWeb.com, has served as Assistant Director at the White House Office of Management and Budget, General Counsel and minority Chief Health Counsel at Senate Finance Committee, Minority Chief Counsel at Senate Rules Committee, Staff Attorney at Senate Budget Committee, and is Author of America’s Priorities: How the U.S. Government Raises and Spends $3 Trillion Per Year.

2018 House Calendar

(Note: House is in recess numerous Mondays and Fridays; check majorityleader.gov)

  • Jan 3: House convenes
  • Jan 22-26: HSE recess
  • Feb 1-2: HSE recess
  • Feb 8-9: HSE recess
  • Feb 19-24: Pres Day recess
  • Mar 26-Apr 9: Easter/Passover recess
  • Apr 30-May 4: HSE recess
  • May 28-Jun 4: Mem Day recess
  • Jul 2-9: July 4 recess
  • Jul 30-Sept 3: Summer recess
  • Sept 10-11: Rosh Hashanah recess
  • Sept 17-21: HSE recess
  • Oct 15-Nov 9: HSE recess
  • Nov 6: ELECTION DAY
  • 19-23: Thanksgiving recess
  • Dec. 13: Target Adjournment
  • PDF: House Calendar