CHN: President Biden’s FY22 Budget Invests in Critical Human Needs Programs
The Biden Administration released its detailed Fiscal Year 2022 budget request on Friday, May 28. The full budget request, which provides greater detail than the President’s “skinny budget” released on April 9, is the first in a decade that is not limited by the low spending caps for annual appropriations required by the Budget Control Act. Highlights from select agency budgets are found in the articles that follow.
President Biden’s budget calls for spending to rise steadily from $6 trillion in FY22 to $8.2 trillion in FY31. Of the $6 trillion in projected FY22 spending, $1.7 trillion is spending that would be annually appropriated by Congress, also known as discretionary spending. CQ notes that includes money appropriated in prior years that hasn’t yet been spent, as well as $1.52 trillion in newly-requested funds. Of this, roughly $770 billion is for non-defense (domestic and international) discretionary (NDD) funding. This reflects a 16.5 percent increase over FY21 levels. Most education and housing programs fall into this category, plus many social service, public health, veterans’ services, criminal justice, homeland security, environmental and community development programs.
The budget also calls for $753 billion in defense discretionary funding, a roughly 1.6 percent increase over FY21. This includes the previously uncapped and controversial Overseas Contingency Operations (OCO) fund, which would now be included in the base defense budget. In a break from the past, the Pentagon budget would dip below half of total discretionary spending (to 49.5 percent). While advocates praised the expansion of funding for human needs programs, many progressives have called for cuts to the defense budget. Some Republicans say the defense request amounts to a cut after accounting for inflation and are calling for parity, or equal increases in defense and nondefense spending.
The Biden Administration budget includes $4 trillion in mandatory spending for FY22. Mandatory spending programs, including Social Security, Medicare, Medicaid, the Children’s Health Insurance Program, SNAP/food stamps, Temporary Assistance for Needy Families, and other basic safety net programs do not require annual appropriations. Instead, Congress authorizes the way they spend money through legislation. Congress can cut or expand these programs by amending the legislation that authorizes them. Much of the increase in the Biden budget over the 10-year window comes from the rising costs of entitlement programs such as Social Security and Medicare.
The Biden budget includes funds to implement the policy changes laid out in the President’s historic American Jobs Plan and the American Families Plan. The Center on Budget and Policy Priorities said the Biden budget, “includes a set of investments… that would dramatically reduce child poverty and help children thrive; improve our nation’s health; expand opportunity in early and higher education; create new workforce development opportunities; bolster households struggling to afford the basics; and allow people to take paid time off from work to meet their own health needs and to provide care for their families.” It proposes to increase the corporate income tax rate and reduce incentives for U.S. multinational corporations to shift profits and investments overseas, and increases taxes on individuals with incomes over $400,000 a year.
While the President’s budget as a whole does not move through Congress or become law, at minimum a president’s budget is a proposal to Congress used to signal an administration’s priorities, and when the president and congressional leadership are from the same party, many of those priorities are influential in shaping congressional action, from appropriations levels to major initiatives.
It is expected that a budget resolution passed by both the House and Senate will contain instructions that will allow Congress to pass all or part of the President’s economic recovery proposals using the reconciliation process. Both the budget resolution and the reconciliation bills that emerge only need a simple majority to pass. A recent decision by the rules-keeper of the Senate (the Senate Parliamentarian) means that Democrats will only have one chance later this year to use budget reconciliation, through a budget resolution the House and Senate agree upon for FY22. This means that anything Democrats need to pass through the Senate with a simple majority vote between now and when they take up a FY23 budget resolution will have to go into one budget reconciliation package.
However, appropriations bills cannot be enacted through a reconciliation process; that means appropriations bills will need 60 votes – and therefore Republican support – to pass in the Senate. With the release of the President’s budget, Congress will begin the process of drafting and debating the 12 annual spending bills covering government functions. The House will likely soon pass a “deeming resolution,” essentially an informal agreement to set the FY22 top-line limit on discretionary spending; this allows appropriators to move forward with drafting spending bills absent a more-formal budget resolution in place. The House Appropriations subcommittees are expected to begin the process of voting on FY22 spending bills later in June, with full committee votes held in July. The Senate Appropriations Committee may begin its work in July. As bipartisan support is needed to pass spending bills in the Senate, many are already predicting the need for a stopgap spending measure, known as a Continuing Resolution, to keep the government funded when the new fiscal year begins October 1.
For more information on congressional FY22 budget and appropriations work, see the April 19 Human Needs Report. Stay tuned to upcoming Human Needs Reports for additional analysis of as the FY22 federal budget and appropriations process moves forward.