CHN: House Budget Committee Begins to Work on Budget Resolution

The House Budget Committee began marking up a budget resolution on Thursday, March 12, but was unable to complete work when fiscal conservatives on the committee demanded that legislation to establish new budget rules move alongside any budget resolution. The Committee will continue its work on March 17. House leadership had hoped to put a budget resolution on the floor of the House next week, but that will be put off until the committee finishes its work.
The draft budget resolution would cut 13 out of 15 categories of domestic discretionary programs (non-defense programs that must be appropriated every year) over the next five years, including deep cuts in housing and other programs. The resolution requires the Committee on Ways and Means to find $8.3 billion in savings by cutting entitlement programs and closing tax loopholes. Four other committees – Agriculture, Education and Workforce, Energy and Commerce, and Government Reform – are directed to reduce “waste, fraud, and abuse” in programs under their jurisdiction by cutting a total of $5 billion over five years.

The resolution also directs the Ways and Means Committee to make $138 billion in tax cuts over the next five years as part of reconciliation instructions. This sum is enough to make permanent all of the tax cuts passed in 2001 and 2003 as well as extend the three popular tax breaks expiring this year: marriage penalty relief, the child tax credit and the new 10 percent tax bracket. (In constrast, the Senate budget resolution directs the Finance Committee to make $81 billion in tax cuts. See story above.)

Budget Process Rule Changes
It is still unclear what will be included in budget process reform legislation, but legislators are discussing caps on appropriations spending and a PAYGO rule. A true PAYGO rule – requiring that new spending and new tax cuts be paid for by cuts or tax increases – would provide long term protection for programs that serve low-income families. On the other hand, a PAYGO rule as proposed by the President and being discussed among House Republicans, would require only spending increases – not tax cuts – to be paid for. This convoluted PAYGO, and several other budget process changes proposed by the President, represent real danger to programs and services for low-income familes. They would increase incentives to cut taxes and reduce incentives to approve new spending.

Budget and Appropriations