70 Days to Fund the Largest Government in the World
As we noted last week, the end of the federal government’s fiscal year is September 30—just 70 days away. The typically long, drawn-out process of setting discretionary spending levels for the coming fiscal year (i.e. spending that isn’t dictated by the government’s previous commitments, like, for example, Social Security) has been compressed significantly this year as members of Congress worked to address the coronavirus pandemic, and that fact will make an already arduous process even more so.
The office of the late Congressman (and civil rights leader) John Lewis (D-Ga.) provides one of the best overviews of the so-called “appropriations process.” While short, the description emphasizes how involved the process is.
First, Rep. Lewis’s office explains the difference between a budget resolution and an appropriations bill. Congress usually – but not always – passes a budget resolution near the beginning of the year. But, as Rep. Lewis’ office notes, “The congressional budget resolution allocates the maximum amount of funding for all discretionary federal initiatives in every fiscal year. The appropriators determine how much actual funding is dedicated for each discretionary initiative.”
Note the words that are emphasized above. The budget resolution, written by the House and Senate Budget Committees, represents Congress’ credit line. It sets a cap for what lawmakers can spend. But that document does not have the force of law. It’s a mere outline. The real power is with the appropriators who determine the final allocations for each federal agency.
But what about the president’s budget? While this document, usually released in early February of each year, is the unofficial kick-off of the annual spending process, it has little practical impact. As a Washington Post headline stated two years ago, “Presidential budgets are pointless these days. Especially Trump’s.” Congress dismisses them and allows its own budgeteers to do their work, both under the current administration and its predecessors.
As a reminder, currently, appropriators are operating under a budget deal that was agreed to last August by President Donald Trump and Democratic leaders in the House and Senate. As scholars from the Brookings Institution noted at the time, that deal means that spending for fiscal year 2021 cannot be all that different than it was in fiscal year 2020. In fact, the budget outline will only allow a $5 billion increase for military spending for fiscal year 2021 and a $5 billion increase for all other discretionary spending programs. That is not a lot of new money to spread across 12 spending bills that will total somewhere in the neighborhood of $1.3 trillion.
As Rep. Lewis’s staff reminds us, the 12 spending bills are “organized by agencies and focus” and handled by an appropriations committee dedicated to that focus. (In their summary, Rep. Lewis’s staff also explains the difference between an appropriations committee and an authorizing committee. Authorizing committees include panels like the House Ways and Means Committee and the Senate Health, Education, Labor, and Pensions Committees. These bodies “craft legislation that creates, modifies, or extends federal programs.” The appropriations committees cannot do that. They simply decide “how much federal funding is dedicated to discretionary initiatives” once the authorizing committees approve those programs.)
In normal years, the appropriations committees, and the various subcommittees (each with their own focus), “hold oversight hearings, review the budget, collect, and review requests from individual Members of Congress for funding within their district and national programs.” These deliberations generally begin in the early spring. With lawmakers working from home (or at least their home districts) for most of the last several months, that work was delayed and really just got started in the last few weeks.
Once a spending bill is written it “must pass the Subcommittee, Full Committee, entire House, and then proceed through the same process in the Senate.” And then, as Rep. Lewis’ staff explains, “Once the differences between the House and Senate versions of a bill are resolved through a Conference Committee composed of House and Senate representatives, the Conference Committee's Report is considered by the House and Senate before being sent to the President for signature.”
As of today (July 22), all 12 annual appropriations bills have passed their respective House committees. The Senate committee has not yet passed one. Indeed, as Roll Call explained this morning, House appropriators have left their Senate counterparts “in the dust.”
And here is the kicker: not only have senator appropriators not written or debated a single spending bill, “it appears unlikely to do so before the November elections.”
What is getting in the way?
Politics – in the form of amendments, or policy riders, that lawmakers sometimes try to tack on to spending bills. These riders can impact everything from abortion policy to the president’s proposed border wall to foreign policy. Back in 1994, College of William and Mary scholars called these amendments “one of the most controversial and frequently used devices of appropriations-based policy-making.” When divisive policy riders find their way onto an appropriations bill, members of Congress may find themselves in the unenviable position of having to decide whether they will oppose a spending bill comprised of thousands of pages that they support due to an impactful sentence – or even a phrase – included in the text.
And, heading into an election, that’s where the Senate finds itself deadlocked. Indeed, Roll Call explains the “holdup is the lack of an agreement between Senate Appropriations Chairman Richard C. Shelby, R-Ala., and ranking member Patrick J. Leahy, D-Vt., on what amendments will be offered in committee.” According to budget experts interviewed by Roll Call, “Democrats want to use amendments to score political points to try to reclaim control of the Senate, and Republicans see no point in taking those shots if there is no expectation the bills will be passed before the elections.”
As readers might remember from previous updates—and previous government shutdowns—if appropriators and the full House and Senate do not manage to get spending bills to the president’s desk by September 30, they will have to pass a continuing resolution. As Rep. Lewis’s staff explains, this legislation is “a stop-gap measure that continues funding for all departments, agencies, offices, and operations funded by that specific bill at the previous fiscal year level for a set period of time.” Often – but not always – they are passed by Congress at the last minute, affording the federal government the ability to narrowly avoid a shutdown.
The good news is that Congress is getting pretty good at that process of passing a continuing resolution (CR). It passed two CRs in fiscal year 2020, eight in fiscal year 2019, and five the year before that. In fact, we went back all the way to fiscal year 1999 and did not find a single year where lawmakers weren’t forced to pass at least one CR.
The record over the last 20 years? In fiscal year 2001, Congress, unable to enact a full-year appropriations package, approved 21 short-term spending bills. An … interesting … way to run the largest enterprise in the world.
Of course, if lawmakers cannot agree to a stopgap, whatever departments and programs are not yet funded must shut down.
According to ThoughtCo, there have been 21 shutdowns in U.S. history. Four have occurred in the last seven years, with three of those happening during President Donald Trump’s term in office. Though it only impacted a partial list of government agencies, the longest shutdown was the most recent—34 days from December 22, 2018 to January 25, 2019 when Republicans and Democrats were stalemated over funding for the president’s border wall.
The stakes this year are higher, of course, politically speaking. The entire House, one-third of the Senate, and the President of the United States are up for re-election this November, and it doesn’t appear that any incumbent stands much to gain from a shutdown.
Has there ever been a government shutdown in the final months before a presidential election? Yes, but these were somewhat brief.
There were two brief shutdowns (totaling three days) in October 1984, right before President Ronald Reagan was reelected in a landslide. During President Reagan’s two terms, there actually were eight shutdowns. According to The History Channel, the two closures in 1984 were due to disagreements over funding of federal water projects, efforts to reverse a Supreme Court decision that had weakened Title IX protections for women in college, and First Lady Nancy Reagan’s “Just Say No” campaign, which aimed to raise minimum penalties for crimes involving marijuana.
The federal government also shut down for 10 days in early 1976 when President Gerald Ford was facing reelection. As The Washington Examiner explained, President Ford “vetoed a bill funding the Department of Labor and the Department of Health, Education and Welfare (now Health and Human Services) over its cost. Congress, controlled by Democrats, overrode the veto, but it took 10 days for all the funding gaps to be filled.”
Will fiscal year 2021 end the same way? Last month The Hill reported, “Republicans are now worried that [President Trump is] likely to pick a fight with [House Speaker Nancy] Pelosi in September over government funding for the next fiscal year.”
If history is a guide, maybe those worries are well-founded. As Winston Churchill famously said in Parliament in 1947, “Indeed it has been said that democracy is the worst form of Government except for all those other forms that have been tried from time to time …”