Congress is about to establish a 2014 budget blueprint, with the House and Senate miles apart on the numbers. The House is likely to pass its resolution this week. The Senate may take a little longer, depending on how the 2013 continuing resolution debate and votes go this week.
House Republicans and Senate Democrats have released a draft budget resolution. It identifies a total amount of tax collections and spending for a year, and allocates the spending by committees. The Committees determine how to allocate spending within the programs of its jurisdiction. For example, the Senate Appropriations Transportation and Housing Committee is given an overall budget, and then figures out how to divide the funding between transportation and housing programs.
Congress has not passed a budget resolution for quite a few years. Normally each Chamber passes a resolution, and then they negotiate their differences to produce a final bill which is signed by the President. For this first time in a while each Chamber will pass a resolution, but that’s where the process will end. There will be no final, negotiated bill for the President to sign. More than you ever want to know about federal budget resolutions can be found here.
The two budget resolutions will reflect the large scale philosophical differences the two parties have on the economy, taxes, and spending.
House Budget Resolution
The House Republican’s budget plan includes no tax increases, no stimulus, and deep spending cuts. It reduces the deficit much more quickly than the Senate proposal and balances the budget by 2023. Read Paul Ryan’s news release and Key Facts/Summary, and some Democratic reactions.
Here’s a Washington Post story about the proposal: “New House GOP budget again takes aim at Obamacare, Medicaid, would lead to balance in 10 years.”
The budget proposes pretty steep cuts in transportation programs. Rep. Paul Ryan, chief architect of the Republican budget proposal, explained:
“While no federal department is free of inefficiency, the Department of Transportation in particular offered a number of areas where spending could be cut back responsibly,” he wrote in an explanation of his proposals. “In the first two years of the Obama administration, funding for the Department of Transportation grew by 24 percent—and that doesn’t count the stimulus spike, which nearly doubled transportation spending in one year.
“The mechanisms of federal highway and transit spending have become distorted, leading to imprudent, irresponsible, and often downright wasteful spending,” according to a summary of the budget. The summary went on to talk about high-speed rail, stating “high-speed and other intercity rail projects should be pursued only if they can be established as self-supporting commercial services… The budget eliminates these projects.” (Ryan budget targets DOT, high-speed rail funding, The Hill)
On spending cuts in general, Ryan writes:
“Unless we change course, we will have a debt crisis. Pressed for cash, the government will take the easy way out: It will crank up the printing presses. The final stage of this intergenerational theft will be the debasement of our currency. Government will cheat us of our just rewards. Our finances will collapse. The economy will stall. The safety net will unravel. And the most vulnerable will suffer.
But it’s not too late. This budget provides an exit ramp from the current mess—and an entry ramp to a better future. Unlike the President’s last budget, which never balanced, this budget achieves balance within ten years.”
The Republican proposal passed out of the Budget Committee on a straight party-line vote. Republicans turned back a Democratic attempt to add President Obama’s American Jobs Act, which includes additional transportation money. The proposal is likely to be voted on and passed later this week.
The full House FY 2014 budget plan can be found here. Legislative text of the measure is available here. The Washington Post’s Wonkblog has “Five huge things we still don’t know about Paul Ryan’s budget.”
Senate Budget Resolution
Senator Patty Murray chairs the Budget Committee, which passed the budget proposal along party lines. Read Murray’s news release and three-page summary, and some Republican reactions. The Associated Press reports that the plan includes
“about $1 trillion in modest cuts to health care providers, the Pentagon, domestic agencies and interest payments on the debt with an equal amount in new revenue claimed by ending some tax breaks. But because Democrats want to restore $1.2 trillion in automatic spending cuts over the same period — cuts imposed by Washington’s failure to strike a broader budget pact — Murray’s blueprint increases spending slightly when compared with current policies.”
For transportation, “Murray is proposing a $100 billion jobs and infrastructure package in her fiscal 2014 budget,” according to Politico, “which includes a $50 billion infusion to fix the most deficient bridges, airports and transit systems and a total of $70 billion for infrastructure as a whole.” Murray’s framework would also provide $10 billion toward improving dams and dredging ports and $10 billion to create an infrastructure bank. The Senate budget summary doesn’t identify a long-term funding source for surface transportation revenues but offers two more financing tools, one of which is the infrastructure bank.”
Find the transportation summary on page 24, and a detailed description on page 39 of this 114-page summary (2.4mb pdf).
Politico has an overview of the Senate plan: Patty Murray plan doesn’t balance budget. The story notes that
“The major difference between the Ryan and Murray approaches has more to do with projected spending over the next 10 years, not revenue increases. Over 10 years, Murray’s plan would cumulatively spend $4.9 trillion more than Ryan’s proposal, according to budget documents.”
“…Murray argues that the sharp cuts in Ryan’s plan would harm economic growth, saying that it makes more sense to stabilize the debt in the long-term rather than balance the budget in just 10 years. Beginning in 2013, when the deficit is projected to account for 5.6 percent of GDP, the annual shortfall would be reduced to 2.2 percent by 2023, she said.”
The Washington Post fact-checks Republican claims that the Senate Democratic budget calls for a $1.5 trillion tax hike.
Larry Ehl is the founder and publisher of Transportation Issues Daily. In the public sector, Larry was Federal Relations Manager for Washington State DOT; Chief of Staff to US Senator Slade Gorton; and was twice elected to the Edmonds School Board.