
No Compromise Seen in Budget Negotiations
by Guest Blogger, 4/19/2005
It has been over a month since the House and Senate passed their fiscal year 2006 budget resolutions, yet GOP negotiators have not made significant strides toward reaching compromise between the two chambers. While only the Senate has named conferees to the conference committee, informal talks between House and Senate leaders have begun to point to difficulties ahead.
Last Friday, April 15, was the statutory deadline by which time Congress is supposed to pass the budget resolution. This deadline is non-binding and the budget resolution is rarely passed before the date. Yet this year it marks a change in the rapid pace maintained by both chambers in their budget work. Both the House and the Senate quickly pushed through their resolutions before recessing for the Easter holiday in mid-March. There have been few developments since then on the budget negotiations as the pace has slowed to a crawl.
The Senate appointed seven senators to the conference committee on April 4, including Budget Committee Chairman Judd Gregg (R-NH) and Ranking Minority Member Kent Conrad (D-ND). The House has yet to name any conferees and there have been no formal meetings of the committee. Some Capitol Hill sources speculate the House will wait to name conferees until a budget deal is accepted in order to avoid a variety of opportunities and platforms for Democrats to criticize the budget.
The major issue separating the two chambers is the level of mandatory spending reductions. The House has included $69 billion in cuts to mandatory programs while the Senate has budgeted only $17 billion. Both reductions would occur over five years. In addition, the Senate specifically removed in an amendment on the floor $20 billion in cuts to the Medicaid program -- a main target of House conservatives for spending cuts.
In continuing talks between the two budget committee chairmen last week, Gregg announced he would consider cuts to mandatory spending programs totaling $43 billion over the next five years. These cuts would come from many different programs including but not limited to Food Stamps, Medicaid, the Earned Income Tax Credit, and student loan subsidies. It is believed cuts to the Medicaid program would fall somewhere between $8 billion and $12 billion.
Further complicating the negotiations over mandatory spending was a letter sent to Nussle from Rep. Heather Wilson (R-NM) asking for Medicaid funding to be protected in budget negotiations with the Senate. The letter was signed by 43 other House Republicans. The support of those 44 Republicans for Medicaid funding may make it impossible to find significant savings this year as a majority of both chambers are now on record as opposing any cuts to the low-income health care program.
As Gregg and Nussle work to settle on a total amount of mandatory savings, they will need to also have a picture of what committees will be asked to cut funding. Both Nussle and Gregg worry any move toward the middle between the two chambers' mandatory savings figures will alienate enough GOP members to prevent floor adoption of a final measure. Gregg needs to keep the total amount of cuts lower to satisfy GOP moderates in the Senate while Nussle cannot accept too low a number without the risk of losing a significant number of House conservatives, many of whom felt the $69 billion in cuts in the House version was too small to begin with.
In addition to the quagmire over the mandatory funding debate, there are also differences in the two versions in the total amount for additional tax cuts, the total discretionary spending level in the budget, and a few somewhat less significant issues. Gregg has said he hopes to have a final budget resolution agreement before the May congressional recess. However, because the two versions of the budget resolution passed by such narrow margins, any compromise will once again be difficult to maneuver through both chambers. This will most likely lead to delays and drag out the process.
