Don't expect a 'grand bargain' in 2013

Chris Moody
Yahoo News
From left, Sen. Jeff Sessions, R-Ala., House Budget Committee Chairman Paul Ryan, R-Wisc., Senate Budget Committee Chair Patty Murray, D-Wash., and Rep. Chris Van Hollen, D-Md., wind up outlining their approach to tackling the nation’s debt problems in the Senate Reception Room at the Capitol in Washington, Thursday, Oct. 17, 2013. With last-minute legislation passed in Congress that reopened the government and averted a national default, bipartisan budget conferees from both houses of Congress emerge from an initial meeting in the Capitol. (AP Photo/ Scott Applewhite)
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From left, Sen. Jeff Sessions, R-Ala., House Budget Committee Chairman Paul Ryan, R-Wisc., Senate Budget Committee Chair Patty Murray, D-Wash., and Rep. Chris Van Hollen, D-Md., wind up outlining their approach to tackling the nation’s debt problems in the Senate Reception Room at the Capitol in Washington, Thursday, Oct. 17, 2013. With last-minute legislation passed in Congress that reopened the government and averted a national default, bipartisan budget conferees from both houses of Congress emerge from an initial meeting in the Capitol. (AP Photo/ Scott Applewhite)

Americans wishing for a "grand bargain" this Christmas are likely to be disappointed.

The bipartisan conference committee established by last week’s 11th-hour agreement to reopen the government and raise the debt ceiling probably won’t produce a truly groundbreaking bipartisan deal that would end the nation's debt problem once and for all, nor are the members aiming that high.

At best, the budget resolution that comes out of the committee may serve as a "down payment" on that debt and provide Congress an opportunity to fulfill its most basic function of setting spending levels so the appropriations committees can fund the government.

In other words, it is likely to be literally the least lawmakers could do — which would be quite an achievement for this unpopular, do-nothing Congress.

As part of the agreement to temporarily keep the government open, the House and Senate have appointed 29 lawmakers to a conference committee tasked with reconciling the House and Senate budget proposals that passed earlier this year. The panel's leaders, Washington Democratic Sen. Patty Murray and Wisconsin Republican Rep. Paul Ryan, who each chair the Budget Committees in their respective chamber, must report back to Congress by Dec. 13 with the final version of the budget.

When the new conference committee members held their first meeting last Thursday, both sides kept expectations low.

“Chairman Ryan knows I’m not going to vote for his budget. I know that he’s not going to vote for mine,” Murray said at the Thursday meeting. “We’re going to find the common ground between our two budgets that we both can vote on. That’s our goal.”

“Our job,” she added, “is to make sure that we have put forward a spending cap and a budget path for this Congress in the next year or two, or further if we can.”

That common ground, as one aide close to Ryan described it to Yahoo News, would amount to little more than “small things.”

At the end of these formal negotiations, Republicans want modest changes made to the nation’s entitlement programs, such as Social Security and Medicare — the primary drivers of U.S. debt — which they say are necessary to keep those programs sustainable for future generations. Democrats want sequestration eliminated, or at least reformed to give federal agencies more flexibility to find savings.

And yes, there is some common ground on this.

Unlike in years past, this time Ryan won’t insist that Democrats hand over the holy grail of Republican entitlement reform: a controversial plan to transform Medicare into a system that provides vouchers for seniors to buy health care in a private market. (Sound familiar?) Instead, as Yahoo News reported earlier this month, Ryan intends to seek more realistic tweaks to entitlement programs that Democrats, including Obama, already have proposed.

Ryan outlined some of his ideas in an op-ed for the Wall Street Journal earlier this month. Although he wrote the piece in the context of the ongoing debt-limit debate at the time, aides close to Ryan say it revealed how he plans to approach the budget conference.

“We could ask the better off to pay higher premiums for Medicare. We could reform Medigap plans to encourage efficiency and reduce costs. And we could ask federal employees to contribute more to their own retirement,” Ryan wrote. “Rep. Dave Camp (R., Mich.) and Sen. Max Baucus (D., Mont.) have been working for more than a year now on a bipartisan plan to reform the tax code. They agree on the fundamental principles: Broaden the base, lower the rates and simplify the code. The president himself has argued for just such an approach to corporate taxes. So we should discuss how Congress can take up the Camp–Baucus plan when it's ready.”

As part of the deal, Republicans appear willing to loosen up the tight reins of sequestration, which is their strongest piece of leverage.

“The sequester offers that nice opportunity” to make structural changes to entitlement spending, a Ryan aide told Yahoo News. “In [Ryan's] mind, it's how he can do everything in his power to forge a good down payment on this debt. If you're just cutting government agency spending, you can't get much, but if you go into entitlement programs, that’s where the bigger structural problems are.” 

The opportunity is indeed a long time coming. This year marks the first time both the House and Senate have passed budget resolutions since 2009.

Since the passage of the Congressional Budget Act of 1974, both chambers are supposed to pass their own resolution that sets spending levels, and then each side appoints members of a conference committee to negotiate their differences. The resolutions are not technically law — the president, who submits his own budget annually, never “signs” a “budget” — but they serve to reveal priorities, force Congress to regularly re-examine its spending and set spending levels for appropriators. For most of President Barack Obama’s time in office — and during three years under former President George W. Bush — Congress has instead funded the government through a series of stopgap bills that set the spending levels for short periods of time

The government currently operates based on spending levels set by the Budget Control Act of 2011, the law that ushered in sequestration, which indiscriminately cut billions across most of the federal government. Democrats hate sequestration outright, and despite the many Republicans who give sequestration lip service because it reined in spending, plenty of them can’t stand the defense cuts.

In March, the Republican-majority House passed its version of a budget resolution, which cut enough spending to balance the federal budget in a decade. The Senate responded two days later with its own resolution (after Republicans threatened to withhold lawmakers’ pay if they didn’t.)

But then seven months passed and nothing happened. Senate Democrats called repeatedly for a budget conference, but Republicans resisted, saying that there was too much disagreement between the parties for formal negotiations to begin. Democrats, who had spent the past four years getting hammered by Republicans because they hadn’t passed a budget resolution of their own, were furious. Finally, last week, as the nation neared its borrowing limit, Republicans agreed to talk.

Striking a deal this year would help the government avoid yet another bout of brinkmanship over a shutdown when the latest round of short-term government funding runs out in January.

But here’s where the hope for a final resolution could fall apart: Traditionally, Congress only really acts when it must. Like schoolchildren and journalists, politicians need deadlines, and severe consequences for not meeting them. (Think back to the ominous-sounding “fiscal cliff,” “government shutdown,” and “Taxmageddon.”)

In this case, there are no hard deadlines for the budget committee.

Yes, the agreement hashed out last week asks the panel to report back to Congress in December, and if they fail, perhaps they’ll find coal in their stockings from Santa Claus at Christmas. Hopefully, the potential for an agreement is more than just a figment of our imagination.

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