More Budget Gimmicks from the House GOP

If Republicans thought they found a clever way to hide the fact that they’re breaking the defense spending sequester cap, they should think again. Instead of adhering to the spending cap for FY16 (which is what they want you to think they’re doing), they’re pulling from OCO to blow right past it. Here’s a round-up of stories on this latest gimmick:

From Politico:

“The great Achilles heel in the House Republican budget Tuesday can be found in a blue-and-white chart, tucked away on page 40 and mapping out a 10-year path for the annual appropriations bills that keep the government operating.”

“On the surface, it appears to keep faith with the spirit of the discretionary spending caps under the 2011 Budget Control Act, a major priority for many fiscal conservatives. But to get the votes of party hawks, the budget makes a sweeping end-run around the caps by declaring an additional $94 billion as emergency spending for the war against terrorism.”

“As a practical matter, the GOP is adding $36 billion to President Barack Obama’s $58 billion 2016 request of emergency funds for Overseas Contingency Operations or OCO monies to pay for not just war costs but also foreign aid. That’s a huge increase which Senate Republicans will not endorse in their budget plan. And it strains credibility given what the same House chart shows for the out years.”

“Indeed, in fiscal 2017, the $94 billion in overseas contingency funds drops precipitously to $27 billion, suggesting the global threats in 2016 will have suddenly dissipated. And a second old budget strategy kicks into place: paying for defense by cutting still more from domestic appropriations.”

“In 2017, the budget assumes defense discretionary spending will be $574 billion, or $38 billion more than the BCA caps. At the same time, the resolution would reduce non-defense spending by $44 billion below the caps as an offset.”

“In real life terms, that’s a more than $30 billion cut from what Congress just approved for this year. And it flies in the face of bipartisan agreements which have tried to restore some order to the process and avert shutdowns since the collapse in 2013.”

“The same pattern repeats itself over the next 10 years to the point that the budget claims an extra $372 billion in deficit reduction while allowing defense to grow by $387 billion above the caps. Non-defense is the big loser, forced to absorb another $759 billion or 14 percent cut below the path set by the BCA.”

“All this is necessary for the GOP to meet the party’s goal of nearly $5.5 trillion in deficit reduction by 2025. Between repealing the Affordable Care Act and cuts from Medicaid, the whole plan rests most heavily on nearly $3 trillion in reductions from health care. But to get over the finish line, it still needs those extra savings from appropriations.”

“Most Republicans admit privately that the chances of accomplishing this are very slim. And the chart tips the GOP’s hand because all the domestic discretionary cuts are put off another year—when the budget is not binding.”

“To understand why, look back at the summer of 2013. Former House Budget Committee Chairman Paul Ryan (R-Wis.) tried the same approach and it ended in disaster for the GOP and led to the government shutdown that fall.”

“House Appropriations Committee Chairman Hal Rogers (R-Ky.) tried to keep the process afloat by moving the easier bills first. But in July 2013, he was forced to suddenly shut down after pulling an otherwise popular transportation and housing measure from the House floor.”

“That experience left real scars and Rogers has warned his leadership privately that it would be a mistake to go down that path again. The new Budget Committee Chairman Tom Price (R-Ga.) is now caught in the middle, trying to get to balance like Ryan but using emergency funds to forestall any discussion just yet about adjusting the caps.”

From the Wall Street Journal: 

“The House proposal… boosts a special supplemental fund to increase military funding beyond the caps.”

“Many Republicans argue that the Defense Department needs a bigger budget to ensure national security at a time of myriad threats and they won’t support a plan with military spending lower than the level proposed by the White House earlier this year.”

“Mr. Price’s budget attempts to address the concerns of both deficit and defense hawks by boosting war funding that isn’t subject to the caps through a separate fund called Overseas Contingency Operations, or OCO.”

“The use of the overseas contingency fund could generate some pushback. Some Republicans have been dismissive of increasing defense spending by using emergency war funding, which lawmakers from both parties have eyed over the years to pay for a range of projects.”

“‘I don’t like it because OCO is a gimmick,’ Senate Armed Services Committee Chairman John McCain (R., Ariz.) told reporters Monday. However, Mr. McCain said he would never vote for a budget that capped military spending at sequester levels.”

“Some conservative Republicans, meanwhile, say the 2011 curbs have been effective in compelling Congress to find budget savings. ‘It’s very, very important that we preserve the overall spending caps, which have been the only success we’ve had at some fiscal discipline in a long time around here,’ Sen. Pat Toomey (R., Pa.) said last week.

From the New York Times:

“To placate advocates of the military who say strict budget caps are hurting national defense, the House budget adds ‘emergency’ war spending through the ‘overseas contingency operations’ account, which does not count against the spending limits.”

“Even before the Senate plan is unveiled, deep rifts are appearing. Senator John McCain of Arizona, chairman of the Senate Armed Services Committee, reiterated his demand on Monday that any budget raise military spending well above the statutory caps. And he said he would not accept an approach that raised spending through the war-fighting emergency account or by shifting money from already squeezed domestic programs.”

“Last year, Mr. Ryan called ‘emergency spending’ increases ‘a backdoor loophole that undermines the integrity of the budget process.’”

From the LA Times:

“Far from a political rallying cry for Republicans, though, this year's budget promises to split the party, making passage uncertain. GOP defense hawks want to bolster Pentagon spending while deficit watchers prefer reductions across the board.”

“The Republicans would keep to the so-called sequester cuts, the deep reductions that both parties agreed to in 2011. Those cut are expected to hit in full force at the start of the fiscal year Oct. 1.”

“But the House GOP plan would boost military funds through a separate account for overseas contingency operations that had been used to fund the wars against terror.”

“Some Republicans call this a gimmick, and the Senate GOP is likely to take a different approach to Pentagon funding by establishing a new reserve fund that could increase the military by reducing spending elsewhere.”

From CQ:

“House Armed Services Republicans huddled behind closed doors early Tuesday morning to discuss their concerns about the House GOP budget resolution, with hawkish lawmakers worried that the proposal doesn't bulk up defense spending enough and questioning whether the money is ‘real.’” 

“The House’s budget resolution beefs up defense spending by adding $39 billion to the Overseas Contingency Operations accounts, which are not subject to the existing caps on federal discretionary spending.”

“Thornberry said he would have preferred to boost base budget accounts rather than relying heavily on the OCO budget to make up for any shortfall in defense spending. But to do so would require a bipartisan agreement to raise or eliminate the current caps on defense spending.”

“During a speech at a defense industry conference Tuesday morning, Ohio Republican Michael R. Turner, who attended the Armed Services meeting, criticized the use of war accounts as a ‘surrender’ to sequestration. ‘That doesn't provide the consistency level that is necessary for the Department of Defense,’ he said. Turner, who chairs the Armed Services Tactical Air and Land Subcommittee, told members of the audience to ‘use your phones’ and raise their concerns with House leadership. ‘Call members of the Budget Committee, call members of leadership and let them know that we are in an absolute crisis,’ Turner said.”

From Reuters:

“To gain support in a divided Republican caucus, Price's plan nominallyadheres to ‘sequester’ spending caps next year but seeks to boost U.S. military spending by adding nearly $40 billion to an off-budget war funding account.”

From the Associated Press: 

“The use of overseas military funds to skirt spending caps on the military, however, is a new feature. War spending is exempt from budget limits and the move would allow Republicans to use budget tricks to match Obama's proposal to boost defense spending by $38 billion above current limits. That was a key demand of the party's defense hawks.”

“Senate Republicans, GOP aides say, are likely to reject the move to radically reshape Medicare and are more reluctant to use war funds to help out the Pentagon.”

“‘It's a gimmick,’ Senate Armed Services Committee Chairman John McCain, R-Ariz., said of padding war accounts.”