Congress's Lame-Duck Spending Fight Drags On

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Congress has yet to make major progress on one of its most basic responsibilities for the year: funding the government.

Fiscal year 2023 started back in October but lawmakers have yet to agree to topline spending levels for the year. House and Senate negotiators reportedly neared a deal last week that would set defense spending at $847 billion, or some $45 billion above the level sought by President Joe Biden. Overall national security spending could run as high as $858 billion, Politico reported.

With defense spending set for a huge boost, Democrats are pressing for a comparable increase in non-defense funding. Republicans are pushing back, arguing that domestic spending should be cut because Democrats already pushed through two big partisan bills in last year’s $1.9 trillion Covid rescue plan and this year’s Inflation Reduction Act. That bill included climate, health care and tax provisions along with more than $200 billion in deficit reduction over 10 years.

“The reconciliation bills spent a ton on domestic,” Sen. Lindsey Graham (D-SC), a member of the appropriations committee, told The Hill. “So, that has to be factored in and in terms of more domestic spending.”

Graham added that the defense spending needs are real and it will be difficult to match those levels on the non-defense side. “There won’t be an omnibus unless you have a generous defense number,” he said, “and, given the multiple trillions of dollars that were spent and reconciliation bills on domestic programs far beyond just COVID, it will be difficult to get a one for one.”

House Speaker Nancy Pelosi (D-CA) and other top Democrats last week raised the prospect of a full-year continuing resolution, which would keep federal funding at 2022 levels. “If Republicans won’t come to the table and negotiate, we could go to a one-year CR if that’s what they want to do,” Rep. Rosa DeLauro, chair of the House Appropriations Committee, told The Hill last week.

Pentagon leaders have warned against such an outcome, and lawmakers in both parties are extremely wary of freezing defense spending at 2022 levels, fearing that it would risk national security. Republicans would prefer a short-term stopgap funding measure that would allow the new GOP-controlled House in the 118th Congress to have more leverage in spending talks.

What’s next: The National Defense Authorization Act appears to be on track, with a floor vote in the House scheduled for later this week. One potential hiccup: The White House is opposing using the bill to repeal a vaccine mandate for military servicemembers and Republicans have threatened to delay the bill if the mandate isn’t repealed. And another: Democrats trying to salvage Sen. Joe Manchin’s energy permitting reform bill may try to attach it to the NDAA.

The outlook for annual spending bills is far less certain. With current government funding set to expire on December 16 — and neither side interested in a year-end shutdown —another stopgap spending bill, likely until December 23, is expected to be necessary as the two sides try to work out a broader deal. Punchbowl News notes that Senate Minority Leader Mitch McConnell (R-KY), who has supported the idea of a full year omnibus spending deal, will be key: “McConnell and other senior Senate Republicans are taking a tough line, despite a high-level meeting in the White House last week where everyone promised to get along.”

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