Senate to Consider Competing Version After Spring Recess
After contentious debate, the House of Representatives passed a $2.1 trillion budget resolution on March 21, by a 221 to 209 margin. The next day, the Senate Budget Committee approved its budget resolution on a 12 to 10 party-line vote. Budget resolutions are non-binding, but provide a blueprint to help guide annual federal spending.

House Democrats attacked the GOP-backed resolution for using accounting gimmicks to mask the effects of the massive tax cut President Bush pushed through last year. Democrats assert that the ten-year $1.35 trillion tax cut significantly eroded budget surpluses. Furthermore, the House-approved resolution would make the cuts permanent – leading, Democrats warn, to increased deficits and a plundering of the Social Security trust fund.

While the resolution approved by the Democratic-controlled Senate Budget Committee does not make the tax cuts permanent, it does dip into Social Security to pay for other programs. The Senate proposal contains more money for education, health care and other non-defense programs than the House budget, which cuts domestic spending by $7.8 billion. The Senate proposal, for example, provides $500 billion for a Medicare prescription drug benefit, expanded health coverage and related provisions. By contrast, the House plan contains $350 billion for similar changes.

Both chambers’ proposals match the President’s budget request for significant increases in military and homeland defense spending; Congress is prepared to spend an additional $46.3 billion on the Pentagon next year – a 13.3 percent increase over this year’s funding level – and $37.7 billion on homeland security – nearly double the current allocation. Unlike the House plan, the Senate measure does not set aside $10 billion for an emergency defense fund.

Using spending and revenue projections from the Congressional Budget Office (CBO), the Senate proposal would result in a $90 billion deficit in fiscal year 2003. By relying on the more optimistic projections provided by the White House’s Office of Management and Budget (OMB), the House budget results in a much smaller, $46 billion deficit in the next fiscal year. Had the House used CBO’s assumptions, its plan would have a deficit of $80 billion next year.

While it is doubtful that House and Senate negotiators will reach an agreement on a budget resolution this year, it is almost certain that appropriators will boost overall defense and social welfare spending beyond what is contained in each proposal. It is also likely that Congress will approve President Bush’s recent request for $27.1 billion in emergency supplemental spending for the war effort, homeland security, and rebuilding New York. A vote on the emergency supplemental will take place when Congress reconvenes after the spring recess.

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