[House Prints, 115th Congress]
[From the U.S. Government Publishing Office]
115th Congress} { Print
2d Session } HOUSE OF REPRESENTATIVES { 115-15
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COMMITTEE PRINT
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COMMITTEE ON THE BUDGET
HOUSE OF REPRESENTATIVES
LEGISLATIVE HISTORY OF THE JOINT SELECT COMMITTEE ON
BUDGET AND APPROPRIATIONS PROCESS REFORM
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
December 19, 2018.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
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LEGISLATIVE HISTORY OF THE JOINT SELECT COMMITTEE
115th Congress} { Print
2d Session } HOUSE OF REPRESENTATIVES { 115-15
======================================================================
COMMITTEE PRINT
----------
COMMITTEE ON THE BUDGET
HOUSE OF REPRESENTATIVES
LEGISLATIVE HISTORY OF THE JOINT SELECT COMMITTEE ON
BUDGET AND APPROPRIATIONS PROCESS REFORM
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
December 19, 2018.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
__________
U.S. GOVERNMENT PUBLISHING OFFICE
*33-612 WASHINGTON : 2019
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C O N T E N T S
Page
Introduction..................................................... 3
Report of the Joint Select Committee on Budget and Appropriations
Process Reform................................................. 5
The Joint Select Committee on Budget and Appropriations Process
Reform Bill Text............................................... 15
Votes of the Joint Select Committee on Budget and Appropriations
Process Reform................................................. 39
Appendix......................................................... 53
Hearings of the Joint Select Committee......................... 55
Introduction............................................... 61
April 17, 2018--Organizational Meeting Followed By Hearing
on Opportunities to Significantly Improve the Federal
Budget Process........................................... 65
May 9, 2018--Bipartisanship in Budgeting................... 139
May 24, 2018--The Budget Resolution-Content, Timeliness,
and Enforcement.......................................... 207
June 27, 2018--Members' Day: How to Significantly Reform
the Budget and Appropriations Process.................... 301
July 12, 2018--Opportunities to Improve the Appropriations
Process.................................................. 479
Congressional Budget Office Briefing Materials Prepared for the
Joint Select Committee....................................... 539
Congressional Research Service Briefing Materials Prepared for
the Joint Select Committee................................... 547
H.R. 7191...................................................... 569
Press Release Accompanying the Introduction of H.R. 7191....... 591
115th Congress} { Print
2d Session } HOUSE OF REPRESENTATIVES { 115-15
======================================================================
COMMITTEE PRINT
_______
LEGISLATIVE HISTORY OF THE JOINT SELECT COMMITTEE ON BUDGET AND
APPROPRIATIONS PROCESS REFORM
_______
December 19, 2018.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
INTRODUCTION
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Dear Colleague:
In the Second Session of the 115th Congress, I was honored
to Co-Chair the Joint Select Committee on Budget and
Appropriations Process Reform. As members of the U.S. House of
Representatives, Article I entrusts in each of us the power of
the purse. This is an awesome responsibility that I, and I know
each of you, take very seriously. We owe it to the American
people to have a process that works, and that was the goal of
the Joint Select Committee--to produce recommendations to
reform the federal budget and appropriations process.
As you know, our Joint Select Committee produced a
bipartisan, bicameral consensus package of reforms in advance
of our statutory deadline of November 30, 2018. During our
markup, amendments were subjected to a supermajority threshold
to ensure those that passed reflected a true consensus of the
panel. Some amendments passed unanimously. During the final
debate on the bill, many members indicated that they had no
objection to the package's underlying reforms. However, the
bill and report developed over many months of hard work failed
to secure the necessary supermajority of votes to pass under
our Joint Select Committee's rules.
Despite the unfortunate outcome of the Joint Select
Committee's work, there is no refuting that the federal budget
process is broken. It is vital that Congress continues these
efforts to reform the budget and appropriations process this
year, next year, and in the years beyond. I have assembled in
this Budget Committee print all the relevant materials to this
year's work. I urge all members to review this information. In
this Committee print, you will find:
The report of the Joint Select Committee on Budget
and Appropriations Process Reform;
The Co-chair's mark, as amended, and voted on, by
the Joint Select Committee;
The votes of the Joint Select Committee;
Hearing transcripts of the Joint Select Committee's
five public hearings;
Congressional Budget Office briefing materials
prepared for the Joint Select Committee;
Congressional Research Service briefing materials
prepared for the Joint Select Committee;
H.R. 7191--a bill introduced in the House by myself
and Representative Yarmuth, a Joint Select Committee Member and
Ranking Member of the House Budget Committee; and
The press release to accompany the introduction of
H.R. 7191.
It is my sincere hope that this important work will
continue in the 116th Congress on a bipartisan and bicameral
basis. I believe Members of Congress, Executive Branch
officials, outside budget experts and academics, as well as
engaged citizens, will find this material useful for future
reform efforts.
I would like to thank the Members of the Joint Select
Committee on Budget and Appropriations Process Reform, our
hardworking staffs, particularly Dan Keniry, David Reich, and
Mary Popadiuk, as well as the House Rules Committee staff, Bob
Weinhagen and Tom Cassidy in the Office of Legislative Counsel,
budget experts at the Congressional Research Service and the
Congressional Budget Office--particularly Mark Hadley and Teri
Gullo--and House Parliamentarian Tom Wickham and his office,
for the year of dedication.
If you have any questions or would like additional
information, please contact Dan Keniry, Staff Director of the
House Budget Committee or Mary Popadiuk, General Counsel of the
House Budget Committee at (202) 226-7270.
Steve Womack
Chairman
Committee on the Budget
REPORT OF THE JOINT SELECT
COMMITTEE ON BUDGET AND
APPROPRIATIONS PROCESS REFORM
----------
SUMMARY
The Joint Select Committee on Budget and Appropriations
Process Reform (JSCBAPR) was established by the Bipartisan
Budget Act of 2018 (BBA 2018), Public Law 115-123, which was
signed into law on February 9, 2018.\1\ The JSCBAPR was a
bipartisan, bicameral panel tasked with considering and
recommending legislative language to ``significantly reform the
budget and appropriations process.''\2\ The JSCBAPR consisted
of 16 members, equally divided between the House and Senate.
The Speaker of the House, the Senate Majority Leader, the House
Minority Leader, and the Senate Minority Leader each appointed
four members to the committee.\3\ House Budget Committee
Chairman Steve Womack (AR-3) and House Appropriations Committee
Ranking Member Nita Lowey (NY-17) served as co-chairs of this
panel.
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\1\ Bipartisan Budget Act of 2018, P.L. 115-123 (2018).
\2\ Id.
\3\ Id.
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History
The Congressional Budget and Impoundment Control Act of
1974 (Budget Act) was enacted to establish an overall framework
for the fairly decentralized process of making budget decisions
in Congress--a process which involves numerous appropriations,
authorizations, and revenue measures under the jurisdiction of
various congressional committees and enacted on differing
schedules. The Budget Act came five decades after
centralization of Executive Branch budget decision making in
what is now called the Office of Management and Budget (OMB).
In part, the Budget Act was a response to Executive Branch
challenges to the primacy in budgetary matters that the
Constitution grants to Congress, including President Nixon's
assertion of power to withhold spending of funds appropriated
by Congress. Other factors include recognition of the growing
complexity of the federal budget and concern over persistent
budget deficits. The 92nd Congress created the Joint Study
Committee on Budget Control, which called for procedural
reforms to strengthen congressional budgeting. Following the
actual impoundment of appropriated funds, Congress acted on the
recommendations of the Joint Study Committee and passed the
Budget Act in 1974.
The Budget Act provides for annual enactment of
congressional budget resolutions to help Congress make an
overall budget plan and sets targets and limits for budget
legislation to be considered during the year. It also
established the Congressional Budget Office (CBO) to give
Congress budget analysis capacity independent of the Executive
Branch and created standing Committees on the Budget in the
House and Senate to develop the annual budget resolutions and
oversee the process.
Since that time, Congress has reviewed the budget process
periodically and amended the Budget Act on several occasions,
including in 1985 and 1990. More recently, concerns about
delays and procedural breakdowns in the budget process
triggered the creation of the JSCBAPR to assess the current
congressional budget and appropriations process and recommend
reforms.
Procedures of the JSCBAPR
The deadline for the JSCBAPR to vote on recommendations,
legislative language, and an accompanying report was November
30, 2018.\4\ Approval of the JSCBAPR proposed legislative and
report language required the votes of a majority of the
committee members appointed by the Speaker of the House and the
Senate Majority Leader and a majority of the committee members
appointed by the House Minority Leader and the Senate Minority
Leader.\5\ This voting threshold was intended to ensure that
the committee's recommendations and report comprised bipartisan
reforms.
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\4\ Id.
\5\ Id.
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Had the JSCBAPR approved the recommendations, the
legislation and report would have been transmitted to the
President, Vice President, the Speaker of the House of
Representatives, and the Majority and Minority Leaders of each
Chamber of Congress.\6\ The following would then have taken
place:
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\6\ Id.
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In the House of Representatives, the legislation would have
been introduced and considered under regular order.
In the Senate, the legislation would have been introduced
on the next session day by the Majority Leader of the Senate or
his designee.\7\ The bill would then have been referred to the
Committee on the Budget, which would have been required to
report the bill without any revision and with a favorable
recommendation, with an unfavorable recommendation, or without
recommendation no later than seven session days after the
bill's introduction. If the Committee on the Budget failed to
report the bill within that period, the bill would have been
automatically discharged from the committee and placed on the
appropriate calendar.\8\ The BBA 2018 also made in order for
any Senator to move to proceed to consideration of the bill two
days after it was reported or discharged from the Committee on
the Budget. Debate on the motion was limited to ten hours, and
the support of three-fifths of the Senate was necessary to
consider and approve the motion.\9\
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\7\ Id.
\8\ Id.
\9\ Id.
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PURPOSE
There have been numerous breakdowns in the budget process
in recent decades. Fiscal year 1995 was the last time Congress
passed a conference report on the budget resolution followed by
passage of thirteen separate appropriations bills before the
beginning of the new fiscal year.\10\
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\10\ Bill Heniff Jr., Congressional Budget Resolutions: Historical
Information, Congressional Research Service, November 16, 2015.
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Continuing resolutions (CRs) have become the status quo for
funding the Federal Government, demonstrating Congress's
failure to complete its work on time. CRs create uncertainty
for agencies and the American people. In many years, there has
been concern that parts of the government would have to shut
down due to the failure to enact even stopgap appropriations,
and shutdowns of various durations have actually occurred. In
the 115th Congress alone, there have been two government
shutdowns. Whether it is federal employees being furloughed,
national parks shutting down, adverse effects on defense and
law enforcement, shutdowns inflict severe damage and
uncertainty on the nation's fiscal state. Additionally,
multiple JSCBAPR members expressed frustration regarding the
lack of legislative tools available for Congress to address
national needs or the national debt in a bipartisan manner.
COMMITTEE ACTION
The JSCBAPR held five public hearings, fulfilling the
requirement set forth in the BBA 2018. In addition to these
formal, open hearings, the JSCBAPR also held two closed
briefings and multiple formal and informal meetings.
Hearings
April 17, 2018--Opportunities to Significantly Improve the
Federal Budget Process
During this hearing, members considered the current
challenges facing the budget and appropriations process in
Congress and discussed possibilities for improvement. Witnesses
included:
Douglas Holtz-Eakin, Ph.D., President, American
Action Forum
Martha Coven, J.D., Lecturer and John L. Weinberg/
Goldman Sachs & Co. Visiting Professor, Woodrow Wilson School
of Public and International Affairs, Princeton University
May 9, 2018--Bipartisanship in Budgeting
During this hearing, members discussed ways to ensure that
the budget and appropriations process work effectively and in a
bipartisan manner regardless of political dynamics. Witnesses
included:
G. William Hoagland, Senior Vice President,
Bipartisan Policy Center
Donald R. Wolfensberger, Fellow, Bipartisan Policy
Center; Fellow, Woodrow Wilson International Center for
Scholars
Emily Holubowich, Participant, Convergence Building
a Better Budget Process Project; Executive Director, Coalition
for Health Funding
Matthew Owens, Participant, Convergence Building a
Better Budget Process Project; Vice President for Federal
Relations and Administration, Association of American
Universities
May 24, 2018--The Budget Resolution--Content, Timeliness, and
Enforcement
During this hearing, members examined the current purpose
and role of the budget resolution and considered possible
options, presented by expert witnesses, to bolster the budget
resolution's impact and influence in the federal budget and
appropriations process. Witnesses included:
Maya MacGuineas, President, Committee for a
Responsible Federal Budget
James C. Capretta, Resident Fellow and Milton
Friedman Chair, American Enterprise Institute
Bill Dauster, Former Democratic Staff Director and
Chief Counsel, Senate Budget Committee
Joseph White, Professor, Department of Political
Science and Center for Policy Studies, Case Western Reserve
University
June 27, 2018--Members' Day
During this hearing, members of both chambers of Congress
testified before the JSCBAPR on their ideas for improving the
budget and appropriations process. Members who testified before
the JSCBAPR included:
The Honorable Paul D. Ryan, Speaker, House of
Representatives
The Honorable Nancy D. Pelosi, Democratic Minority
Leader, House of Representatives
The Honorable Steny H. Hoyer, Democratic Minority
Whip, House of Representatives
Representative Hal Rogers (KY-05)
Representative Pete Visclosky (IN-01)
Representative Robert Aderholt (AL-04)
Representative David Price (NC-04)
Representative Rob Bishop (UT-01)
Representative John Carter (TX-31)
Representative Devin Nunes (CA-22)
Senator Bob Corker (TN)
Representative Jim Himes (CT-04)
Representative Tom McClintock (CA-04)
Representative Jim Renacci (OH-16)
Representative Daniel Webster (FL-11)
Representative Elizabeth Esty (CT-05)
Representative Bill Foster (IL-11)
Representative Keith Rothfus (PA-12)
Senator Steve Daines (MT)
Representative French Hill (AR-02)
Representative Bruce Westerman (AR-04)
Representative Warren Davidson (OH-08)
Representative Pramila Jayapal (WA-07)
Representative Roger Marshall (KS-01)
Representative Lloyd Smucker (PA-16)
Representative John Curtis (UT-03)
Representative Ralph Norman (SC-05)
Additional statements were submitted for the record by:
Representative Virginia Foxx (NC-05)
Representative Mario Diaz-Balart (FL-25)
Senator Dean Heller (NV)
Representative Bradley Byrne (AL-01)
Representative Paul Mitchell (MI-10)
July 12, 2018--Opportunities to Improve the Appropriations
Process
During this hearing, members considered the current
challenges facing the appropriations process in Congress and
discussed possibilities for improvement. Witnesses included:
The Honorable Leon Panetta, Former Secretary of
Defense, 2011-2013; Chairman, The Panetta Institute for Public
Policy
The Honorable David Obey, Former Chairman of House
Appropriations Committee, 2007-2011
Briefings
April 11, 2018--Briefing with the Congressional Research
Service
Members of the JSCBAPR heard from experts from the
Congressional Research Service (CRS) regarding the issues
facing the budget and appropriations process, past reform
efforts, and potential options for the JSCBAPR to explore.
July 17, 2018--Briefing with the Congressional Budget Office
and the Congressional Research Service
Members of the JSCBAPR heard from experts from CBO and CRS
on implementation and potential impacts of reforms considered
by the JSCBAPR.
Committee Meetings
The JSCBAPR held multiple meetings, both formal and
informal, since its establishment. These meetings provided a
collegial opportunity for JSCBAPR members to discuss reforms to
the budget and appropriations process. These meetings also
provided the basis for the recommendations made in this report.
A listing of the JSCBAPR's informal working sessions follows:
March 7, 2018--Initial JSCBAPR organizing meeting
August 22, 2018--JSCBAPR working group meeting
September 13, 2018--JSCBAPR working group meeting
September 26, 2018--JSCBAPR working group meeting
RECOMMENDATIONS
Biennial Budgeting
Over the past few Congresses, there has been increasing
support for a biennial budget. Since the first public meeting
of the JSCBAPR, biennial budgeting has been viewed as a
practical and necessary solution to the continued delays in the
current budget and appropriations process. Additionally, the
JSCBAPR heard repeatedly from witnesses, as well as from
multiple outside organizations across the political spectrum,
that biennial budgeting is an excellent starting point for any
budget and appropriations reform effort.
One of the principal arguments in favor of biennial
budgeting is that it will allow for more time in the budget
process. Providing a 302(a) allocation for two years to the
Appropriations Committees at the beginning of a Congress will
allow for a smoother appropriations process. It will also allow
the Appropriators additional time to engage in dialogue with
the Executive Branch on the Administration's priorities.
Another key argument in favor of biennial budgeting is that
it will allow for greater certainty in the budget process,
particularly for Executive Branch entities. One of the chief
complaints heard consistently by members of Congress and the
JSCBAPR is that nearly every executive agency and department
suffers under a protracted budget negotiation, delayed spending
bills, and continuing resolutions.
A biennial budget would also provide Congress additional
time to conduct oversight on federal agencies and departments.
When Appropriators and authorizers have more certainty, they
can turn their attention to those entities that they fund and
oversee, respectively. This also serves to buttress Congress's
constitutional authority and ensures that appropriated funds
are being used responsibly and authorized programs are
implemented consistently with Congressional intent.
Finally, biennial budgeting would free up time in the
legislative calendar to enable Congress to not be mired down in
annual budget resolution squabbles.
Second Session Revision of the Budget Resolution for Scoring Purposes
A requirement of a biennial budget resolution would be
authority in the second year of a biennium to adjust the budget
resolution's spending and revenue levels, committee
allocations, and other amounts to reflect an updated baseline
used for scoring purposes.
Realistic Deadline for Congress to Complete Action on a Biennial Budget
One of the challenges identified by the JSCBAPR was that
Congress has continually failed to adopt a budget resolution by
the statutorily required April 15th deadline. In those years in
which Congress has adopted a budget resolution, it has adopted
the budget resolution an average of 36 days after the target
date.\11\ This deadline does not reflect a realistic timeline.
To this end, the JSCBAPR believed that setting a realistic and
achievable deadline of May 1st for the first year of the
biennium would provide Congress an opportunity to complete its
work on time.
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\11\ This does not include fiscal year 1999, fiscal year 2003,
fiscal year 2005, fiscal year 2007, and fiscal years 2011 through 2015.
See Bill Heniff Jr., Congressional Budget Resolutions: Historical
Information, Congressional Research Service, November 16, 2015.
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Annual Supplemental Budget Submission by the President
While JSCBAPR members recognized that Article I entrusts in
the Congress the power of the purse, members also had an
appreciation that there is critical data that Congress requires
from the Executive Branch to begin the budget building process.
Specifically, CBO cannot begin constructing its baseline for
the upcoming fiscal year without receipt of data, particularly
prior-year and current-year spending, that is normally
transmitted with the President's budget request. Without
receipt of CBO's baseline, Congress generally cannot begin
writing its budget resolution. To create additional time for
developing the baseline, and therefore, the budget resolution
and various appropriations bills, the JSCBAPR believed that the
Executive Branch should be required to provide a supplemental
budget submission that is separate from the President's policy
proposals no later than December 1st of each calendar year.
This supplemental budget submission would include:
Prior year fiscal data
Current year fiscal data
Credit re-estimates for the current year
This data would allow CBO to begin constructing the
baseline, as well as enable the Budget and Appropriations
Committees to begin their respective work in writing the budget
resolution and appropriations bills earlier in the process. The
President would then submit policy proposals later in the
process, which would be considered as Congress continues its
work on the budget resolution and annual appropriations bills.
Encourage the Use of Best Practices in the Appropriations Process
The JSCBAPR noted that Congress was more successful this
year than in other recent years moving appropriations bills
through the process on a timelier basis, with five fiscal year
2019 appropriations measures, including the three largest,
signed into law before the start of the fiscal year. One factor
in this success appears to have been the strategic combination
of individual bills into multi-bill packages for initial
consideration by the House and Senate, as well as for the final
conference stage.
JSCBAPR members recommended that the Appropriations
Committees review the record of recent practices for
consideration of appropriations bills, identify practices which
have been helpful in expediting action and increasing
opportunities for member involvement at various stages of
consideration, and build those successful practices into their
work for future years. JSCBAPR members also recommended that
the Appropriations Committees and other committees with
responsibilities in this area study the best ways of using the
new biennial budget resolution schedule to expedite
congressional work on appropriations and other budgetary
legislation.
Reconstitute Senate Budget Committee
JSCBAPR members noted that the Senate Budget Committee
should be reconstituted to include the Appropriations and
Finance Chairs and Ranking Members and make it comprised of
eight members from the majority and seven members from the
minority. This would elevate the Senate Budget Committee to be
more prominent and foster greater seriousness and
bipartisanship to its important work.
Add Bipartisan Budget Resolution in the Senate
JSCBAPR members noted that the budget process has become
exceedingly partisan in recent years. Partisan posturing has
contributed to numerous budget and appropriations delays and
threats of government shutdowns. Political disagreement on the
debt limit has imposed unnecessary costs on our nation's
economy. This budget option would have fostered bipartisan work
on the Senate Budget Committee. In addition to the other
requirements of Section 301 of the Congressional Budget Act, a
bipartisan budget resolution would have required to include a
target for the ratio of the public debt to the gross domestic
product and a multi-year glideslope for achieving it. The
glideslope would have included the four primary drivers of
deficits: health care spending, tax expenditures, discretionary
appropriations, and revenue levels. The glideslope could have
also included other economic and policy targets such as
employment, income equality, and economic growth.
Committee approval of a bipartisan budget resolution
required a majority of Democratic members and a majority of
Republican members. The Senate Majority and Minority Leaders
would then have been empowered to agree on expedited floor
consideration including limited debate and amendment votes. To
be considered a bipartisan budget, a conferenced budget
resolution or House budget resolution must have included the
content requirements described above.
Upon passage in both chambers, a bipartisan budget
resolution would trigger biannual reporting by the
Congressional Budget Office. This reporting requirement
remained unless displaced by passage of a subsequent bipartisan
budget resolution. Senate passage of a reconciliation bill
pursuant to a bipartisan budget resolution would have required
15 votes from the minority party.
Annual Reconciliation
Under a biennial budgeting model, it was the JSCBAPR's view
that the annual reconciliation process should be preserved.
JSCBAPR's legislative intent was for reconciliation to remain
an annual exercise. Reconciliation instructions would have been
based on a single fiscal year, consistent with annual
appropriations. JSCBAPR's legislative recommendations amended
current law to clarify that reconciliation may be used each
fiscal year of a biennium. As a result, a budget resolution
could provide directives to one or more committees for each
fiscal year of a biennium and over a specified period of the
budget window; (e.g. five or ten years). Congress should have
the ability to consider reconciliation legislation at any point
during a biennium and have the use of reconciliation's
expedited procedures each fiscal year to legislatively address
mandatory spending, revenue, the debt limit, or any combination
thereof.
A review of the historical use of reconciliation
demonstrates its success in significantly reducing the deficit,
particularly in the 1980s. The JSCBAPR believed that this
practice - the use of annual reconciliation to reduce the
deficit - should be encouraged in future Congresses.
Require a Joint Budget Committee Hearing on the Fiscal State of the
Nation
Members of the JSCBAPR believed that members of Congress
must have access to nonpartisan information about the many
factors contributing to the nation's debt and deficit in order
to develop sound fiscal policies and meet our long-debt and
deficit reduction goals. To accomplish this, JSCBAPR members
recommended the House and Senate Budget Committees should be
required to hold a biennial, joint hearing with testimony from
the Comptroller General of the United States regarding the
audited financial statement of the Executive Branch. This
`Fiscal State of the Nation' hearing would have needed to occur
at least once during the second session of a Congress after a
biennial budget resolution is adopted and would have enabled
members to assess the nation's long-term fiscal sustainability.
As a joint hearing, the chairs of the Budget Committees should
have alternated presiding and hosting the hearing each
Congress. The JSCBAPR encouraged the chairs of the Budget
Committees to follow House and Senate rules when convening the
Fiscal State of the Nation hearing. Therefore, the chairs of
the Budget Committees would have been encouraged to make a
public announcement of the date, place, and subject matter of
the hearing at least seven calendar days before the hearing.
All members of Congress would be invited to attend the hearing,
and the JSCBAPR strongly encouraged the chairs of the Budget
Committees to agree to allow all members to waive onto their
respective Budget Committee for the hearing by unanimous
consent. A video recording of the Fiscal State of the Nation
hearing would have been made publicly available on the Budget
Committees' websites.
Members of the JSCBAPR also recommended establishing
additional forums for all members of Congress to access the
information presented in the Fiscal State of the Nation
hearing. To accomplish this goal, members of the JSCBAPR
encouraged the House and Senate to implement the following
recommendations:
First, all four party caucuses in the House and Senate
would have been encouraged to hold a biennial meeting with the
same content presented by the witnesses from the required joint
Fiscal State of the Nation hearing held by the Budget
Committees. The JSCBAPR also encouraged the caucuses to include
in those meetings a briefing from the Congressional Budget
Office (CBO) to educate members on the function and role of CBO
in the budget process.
Second, the House and Senate should have incorporated
content from the Fiscal State of the Nation hearing, and an
introductory briefing from CBO, into the official orientation
process for all newly-elected members of Congress conducted by
the Committee on House Administration and the Secretary of the
Senate, respectively. These new member orientations typically
take place prior to the new members being sworn in and include
briefings on the legislative process, congressional rules, and
ethics policies. The JSCBAPR believed this is the ideal forum
to present the findings from the most recent Fiscal State of
the Nation hearing to new members of the House and Senate and
educate them on the critical role of CBO in the budget process.
Accordingly, the JSCBAPR urged the Committee on House
Administration and the Secretary of the Senate to ensure that
these two training opportunities would be provided for all new
members.
Include Total Combined Outlays and Revenues for Tax Expenditures as an
Optional Item in the Budget Resolution
JSCBAPR members expressed interest in providing greater
transparency regarding tax expenditures because they are a
major component of the federal budget. Therefore, JSCBAPR
members believed that total combined outlays and revenues for
tax expenditures should have been an optional item in the
budget resolution's text.
THE JOINT SELECT COMMITTEE
ON BUDGET AND APPROPRIATIONS
PROCESS REFORM BILL TEXT
----------
The following text is the Co-Chair's Mark, as amended, and
voted on by The Joint Select Committee on Budget and
Appropriations Process Reform on November 29, 2018.
(Original Signature of Member)
115th CONGRESS
2d Session
H. R. __
To implement the recommendations of the Joint Select Committee on
Budget and Appropriations Process Reform.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
Mr. Womack (for himself and Mrs. Lowey) introduced the following bill;
which was referred to the Committee on _______________
_______________________________________________________________________
A BILL
To implement the recommendations of the Joint Select Committee on
Budget and Appropriations Process Reform.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Bipartisan Budget
and Appropriations Reform Act of 2018''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--BIENNIAL BUDGET RESOLUTIONS
Sec. 101. Purposes.
Sec. 102. Definitions.
Sec. 103. Revision of timetable.
Sec. 104. Biennial concurrent resolutions on the budget.
Sec. 105. Committee allocations.
Sec. 106. Revision of biennial budget.
Sec. 107. Additional amendments to the Congressional Budget Act of 1974
to effectuate biennial budgeting.
Sec. 108. Reconciliation process.
Sec. 109. Bipartisan budget resolution.
Sec. 110. Effective date.
TITLE II--OTHER MATTERS
Sec. 201. Views and estimates of committees.
Sec. 202. Annual supplemental budget submission by the President.
Sec. 203. Hearing on the fiscal state of the Nation.
Sec. 204. Reform of Senate Budget Committee.
TITLE I--BIENNIAL BUDGET RESOLUTIONS
SEC. 101. PURPOSES.
Paragraph (2) of section 2 of the Congressional Budget and
Impoundment Control Act of 1974 is amended to read as follows:
``(2) to facilitate the determination biennially of the
appropriate level of Federal revenues and expenditures by the
Congress;''.
SEC. 102. DEFINITIONS.
Section 3 of the Congressional Budget and Impoundment Control Act
of 1974 (2 U.S.C. 622) is amended--
(1) in paragraph (4), by striking ``for a fiscal year''
each place it appears and inserting ``for a biennium''; and
(2) by adding at the end the following new paragraphs:
``(12) The term `direct spending' has the meaning given to
such term in section 250(c)(8) of the Balanced Budget and
Emergency Deficit Control Act of 1985.
``(13) The term `biennium' means any period of 2
consecutive fiscal years beginning with an even-numbered fiscal
year.
``(14) The term `budget year' has the meaning given that
term in section 250(c)(12) of the Balanced Budget and Emergency
Control Act of 1985.''.
SEC. 103. REVISION OF TIMETABLE.
Section 300 of the Congressional Budget Act of 1974 (2 U.S.C. 631)
is amended to read as follows:
``timetable
``Sec. 300. The timetable with respect to the congressional budget
process for any Congress is as follows:
``First Session
On or before: Action to be completed:
First Monday in February................ President submits budget.
February 15............................. Congressional Budget Office submits report to Budget Committees.
March 1................................ Committees submit views and estimates to Budget Committees.
April 1................................. Senate Budget Committee reports biennial budget.
May 1................................... Congress completes action on the biennial budget.
May 15.................................. Appropriation bills may be considered in the House of Representatives.
June 10................................. House Appropriations Committee reports last annual appropriation bill.
October 1............................... First fiscal year of the biennium begins.
``Second Session
On or before: Action to be completed:
First Monday in February................ President submits budget.
February 15............................. Congressional Budget Office submits report to Budget Committees.
June 10................................. House Appropriations Committee reports last annual appropriation bill.
October 1............................... Second fiscal year of the biennium begins.''.
SEC. 104. BIENNIAL CONCURRENT RESOLUTIONS ON THE BUDGET.
(a) Contents of Resolution.--
(1) In general.--Section 301(a) of the Congressional Budget
Act of 1974 (2 U.S.C. 632(a)) is amended--
(A) by striking the matter preceding paragraph (1)
beginning with ``On or before April 15'' and inserting
the following: ``On or before May 1 of each odd-
numbered calendar year, the Congress shall complete
action on a concurrent resolution on the budget for the
biennium beginning on October 1 of that calendar year.
The concurrent resolution shall set forth appropriate
levels for each fiscal year in the biennium and for at
least each fiscal year in the next 2 bienniums for the
following--'';
(B) in paragraph (6)--
(i) by striking ``for the fiscal year'' and
inserting ``for each fiscal year in the
biennium''; and
(ii) by striking ``and'' at the end;
(C) in paragraph (7)--
(i) by striking ``for the fiscal year'' and
inserting ``for each fiscal year in the
biennium''; and
(ii) by striking the period at the end and
inserting ``; and'';
(D) by adding after paragraph (7) the following:
``(8) subtotals of new budget authority and outlays for
nondefense discretionary spending; defense discretionary
spending; direct spending; and net interest.''; and
(E) by adding at the end of the matter following
paragraph (8) (as added by subparagraph (D)) the
following: ``The concurrent resolution on the budget
for a biennium shall include procedures for adjusting
spending and revenue levels, committee allocations, and
other amounts in the resolution during the second
session of a Congress to reflect an updated baseline
that will be used for scoring purposes.''.
(b) Additional Matters in Concurrent Resolution.--Section 301(b) of
the Congressional Budget Act of 1974 (2 U.S.C. 632(b)) is amended--
(1) in paragraph (3), by striking ``for such fiscal year''
and inserting ``for either fiscal year in such biennium'';
(2) in paragraph (8), by striking ``and'' at the end;
(3) in paragraph (9), by striking the period at the end and
inserting ``; and''; and
(4) by adding at the end the following:
``(10) include total combined outlays and revenues for tax
expenditures.''.
(c) Hearings and Report.--Section 301(e)(1) of the Congressional
Budget Act of 1974 (2 U.S.C. 632(e)) is amended by striking ``fiscal
year'' and inserting ``biennium''.
(d) Goals for Reducing Unemployment.--Section 301(f) of the
Congressional Budget Act of 1974 (2 U.S.C. 632(f)) is amended by
striking ``fiscal year'' each place it appears and inserting
``biennium''.
(e) Economic Assumptions.--Section 301(g) of the Congressional
Budget Act of 1974 (2 U.S.C. 632(g)) is amended by striking ``for a
fiscal year'' and inserting ``for a biennium''.
(f) Section Heading.--The section heading of section 301 of the
Congressional Budget Act of 1974 (2 U.S.C. 632) is amended by striking
``annual adoption of'' and inserting ``adoption of biennial''.
SEC. 105. COMMITTEE ALLOCATIONS.
Section 302 of the Congressional Budget Act of 1974 (2 U.S.C. 633)
is amended--
(1) in subsection (a)(1)--
(A) by striking ``for that period of fiscal years''
and inserting ``for all fiscal years covered by the
resolution''; and
(B) by striking ``only for the fiscal year of that
resolution'' and inserting ``only for each fiscal year
of the biennium'';
(2) in subsection (c)--
(A) by striking ``subsection (a)'' and inserting
``subsection (a)(1)'';
(B) by striking ``for a fiscal year'' and inserting
``for a budget year''; and
(C) by striking ``for that fiscal year'' and
inserting ``for that budget year'';
(3) in subsection (f)(1)--
(A) by striking ``for a fiscal year''; and
(B) by striking ``the first fiscal year'' and
inserting ``either fiscal year of the biennium of that
resolution''; and
(4) in subsection (f)(2)(A), by--
(A) striking ``first fiscal year'' and inserting
``either fiscal year of the biennium of that
resolution''; and
(B) striking ``the total of fiscal years'' and
inserting ``the total of all fiscal years covered by
the resolution''.
SEC. 106. REVISION OF BIENNIAL BUDGET.
Section 304 of the Congressional Budget Act of 1974 (2 U.S.C. 635)
is amended to read as follows:
``permissible revisions of concurrent resolutions on the budget
``Sec. 304. At any time after the concurrent resolution on the
budget has been agreed to pursuant to section 301 and before the end of
the biennium, the two Houses may adopt a concurrent resolution that
revises or reaffirms the most recently agreed to concurrent resolution
on the budget. Any concurrent resolution that revises or reaffirms the
most recently agreed to concurrent resolution on the budget shall be
considered under the procedures set forth in section 305.''.
SEC. 107. ADDITIONAL AMENDMENTS TO THE CONGRESSIONAL BUDGET ACT OF 1974
TO EFFECTUATE BIENNIAL BUDGETING.
(a) Enforcement of Section 303.--Section 303 of the Congressional
Budget Act of 1974 (2 U.S.C. 634) is amended--
(1) in subsection (a)--
(A) by striking ``for a fiscal year'' and inserting
``for a biennium''; and
(B) by striking ``the first fiscal year covered by
that resolution'' and inserting ``either fiscal year of
that biennium'';
(2) in subsection (b)(1)(B), by striking ``the fiscal
year'' and inserting ``the biennium''; and
(3) in subsection (c)--
(A) in paragraph (1)--
(i) by striking ``for a fiscal year'' and
inserting ``for a biennium''; and
(ii) by striking ``for that year'' in each
instance and inserting ``for each year of that
biennium''; and
(B) in paragraph (2), by striking ``after the year
the allocation referred to in that paragraph is made''
and inserting ``after the years the allocations
referred to in that paragraph are made''.
(b) Section 305.--Subsections (a)(3) and (b)(3) of section 305 of
the Congressional Budget Act of 1974 (2 U.S.C. 636) are amended by
striking ``for a fiscal year''.
(c) Section 311 Point of Order.--
(1) In the house of representatives.--Section 311(a)(1) of
the Congressional Budget Act of 1974 (2 U.S.C. 642(a)) is
amended--
(A) by striking ``for a fiscal year'';
(B) by striking ``the first fiscal year'' each
place it appears and inserting ``either of the first
two fiscal years covered by such resolution''; and
(C) by striking ``that first fiscal year'' and
inserting ``either of the first two fiscal years''.
(2) In the senate.--Section 311(a)(2) of the Congressional
Budget Act of 1974 (2 U.S.C. 642(a)(2)) is amended--
(A) in subparagraph (A), by striking ``for the
first fiscal year'' and inserting ``for either of the
first two fiscal years''; and
(B) in subparagraph (B)--
(i) by striking ``that first fiscal year''
the first place it appears and inserting
``either of the first two fiscal years''; and
(ii) by striking ``that first fiscal year
and the ensuing fiscal years'' and inserting
``all fiscal years''.
(3) Social security levels.--Section 311(a)(3) of the
Congressional Budget Act of 1974 (2 U.S.C. 642(a)(2)) is
amended by--
(A) striking ``for the first fiscal year'' and
inserting ``for either of the first two fiscal years'';
and
(B) striking ``that fiscal year and the ensuing
fiscal years'' and inserting ``all fiscal years''.
SEC. 108. RECONCILIATION PROCESS.
Section 310(a) of the Congressional Budget Act of 1974 (2 U.S.C.
641(a)) is amended--
(1) in the matter before paragraph (1), by striking ``A
concurrent'' and all that follows through ``shall'' and
inserting ``A concurrent resolution on the budget for a
biennium shall, for each fiscal year of the biennium'';
(2) in paragraph (1)(A), by striking ``for such fiscal
year'' and inserting ``for each fiscal year of the biennium'';
(3) in paragraph (1)(C), by striking ``such fiscal year''
and inserting ``each fiscal year of the biennium''; and
(4) in paragraph (1)(D), by striking ``such fiscal year''
and inserting ``each fiscal year of the biennium''.
SEC. 109. BIPARTISAN BUDGET RESOLUTION.
(a) Definition.--Section 3 of the Congressional Budget and
Impoundment Control Act of 1974 (2 U.S.C. 622), as amended by section
102, is further amended by adding at the end the following:
``(15) The term `bipartisan budget resolution' means a
concurrent resolution on the budget for a biennium--
``(A) ordered reported to the Senate by the
Committee on the Budget of the Senate by an affirmative
vote of not less than half of the Senators that are
members of the majority party in the Senate and not
less than half of the Senators that are members of the
minority party in the Senate;
``(B) that establishes--
``(i) a target for the ratio of the public
debt to the gross domestic product as of the
end of the period covered by the concurrent
resolution or a later date; and
``(ii) for each fiscal year covered by the
concurrent resolution, targets for--
``(I) the ratio of the public debt
to the gross domestic product;
``(II) the amount of health care
spending by the Government;
``(III) the amount of tax
expenditures;
``(IV) the amount of discretionary
appropriations (as defined in section
250 of the Balanced Budget and
Emergency Deficit Control Act of 1985
(2 U.S.C. 900)); and
``(V) the amount of revenues; and
``(C) which may include other economic or policy
targets.''.
(b) Consideration of Bipartisan Budget Resolutions.--Section 305 of
the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C.
636) is amended by adding at the end the following:
``(e) Procedures in the Senate for Bipartisan Budget Resolutions.--
``(1) Other expedited process.--In the Senate, upon the
agreement of the majority leader and the minority leader,
additional procedures to expedite consideration of a bipartisan
budget resolution (which may include limiting the number of
amendments upon which the Senate shall vote) shall apply to
consideration of the bipartisan budget resolution. The majority
leader shall submit a written statement for the Congressional
Record reflecting any agreement described in this paragraph.
``(2) Passage.--In the Senate, a bipartisan budget
resolution shall be agreed to only upon the affirmative vote of
not less than--
``(A) three-fifths of the Members, duly chosen and
sworn; and
``(B) 15 Members that are members of the minority
party in the Senate.
``(3) Amendments between the houses and conference
reports.--To be considered a bipartisan budget resolution, a
conference report or an amendment between the Houses on a
concurrent resolution on the budget shall--
``(A) comply with section 3(15)(B); and
``(B) be agreed to in the Senate by an affirmative
vote of not less than--
``(i) three-fifths of the Members, duly
chosen and sworn; and
``(ii) 15 Members that are members of the
minority party in the Senate.''.
(c) Reconciliation Under Bipartisan Budget Resolutions.--Section
310(e)(2) of the Congressional Budget and Impoundment Control Act of
1974 (2 U.S.C. 641(e)(2)) is amended--
(1) by inserting ``(A)'' before ``Debate''; and
(2) by adding at the end the following:
``(B) In the Senate, a reconciliation bill reported under
subsection (b) pursuant to reconciliation instructions in a
bipartisan budget resolution, a House amendment thereto, and a
conference report thereon shall be agreed to only upon the
affirmative vote of not less than--
``(i) a majority of the Members voting, a quorum
being present; and
``(ii) 15 Members that are members of the minority
party in the Senate.''.
(d) Reporting.--Section 202 of the Congressional Budget and
Impoundment Control Act of 1974 (2 U.S.C. 603) is amended by adding at
the end the following:
``(h) Report on Ratio of the Public Debt to the Gross Domestic
Product.--On and after the date on which the first bipartisan budget
resolution is agreed to, the Director of the Congressional Budget
Office shall submit to Congress semiannual reports on the ratio of the
public debt to the gross domestic product, which shall evaluate whether
the targets in the most recently agreed to bipartisan budget resolution
have been met.''.
SEC. 110. EFFECTIVE DATE.
This title and the amendments made by this title shall take effect
immediately before noon January 3, 2019.
TITLE II--OTHER MATTERS
SEC. 201. VIEWS AND ESTIMATES OF COMMITTEES.
Section 301(d) of the Congressional Budget and Impoundment Control
Act of 1974 (2 U.S.C. 632(d)) is amended to read as follows:
``(d) Views and Estimates of Other Committees.--
``(1) In general.--Not later than March 1 of the first
session of a Congress, or upon the request of the Committee on
the Budget of the House of Representatives or the Senate, each
committee of the House of Representatives and the Senate having
legislative jurisdiction shall submit to its respective
Committee on the Budget its views and estimates (as determined
by the committee making such submission) with respect to the
following:
``(A) Any legislation to be considered during that
Congress that is a priority for the committee.
``(B) Any legislation within the jurisdiction of
the committee that would establish, amend, or
reauthorize any Federal program and likely have a
significant budgetary impact.
``(2) Additional matters.--Any committee of the House of
Representatives or the Senate and any joint committee of the
Congress may submit to the appropriate Committees on the Budget
its views and estimates with respect to all matters set forth
in subsections (a) and (b) which relate to matters within its
jurisdiction.
``(3) Joint economic committee.--The Joint Economic
Committee shall submit to the Committees on the Budget of both
Houses its recommendations as to the fiscal policy appropriate
to the goals of the Employment Act of 1946.''.
SEC. 202. ANNUAL SUPPLEMENTAL BUDGET SUBMISSION BY THE PRESIDENT.
Section 1106 of title 31, United States Code, is amended by adding
at the end the following:
``(d) On or before December 1 of each calendar year, the President
shall submit to Congress an administrative budget for the fiscal year
beginning in the ensuing calendar year, which shall include up-to-date
estimates for current year and prior year data and credit reestimates
for the current year (as included in the Federal credit supplement of
such budget).''.
SEC. 203. HEARING ON THE FISCAL STATE OF THE NATION.
(a) In General.--Not later than 45 days (excluding Saturdays,
Sundays, and holidays) after the date on which the Secretary of the
Treasury submits to Congress the audited financial statement required
under paragraph (1) of section 331(e) of title 31, United States Code,
on a date agreed upon by the chairs of the Committees on the Budget of
the House of Representatives and the Senate and the Comptroller General
of the United States, the chairs shall conduct a hearing to receive a
presentation from the Comptroller General reviewing the findings of the
audit required under paragraph (2) of such section and providing, with
respect to the information included by the Secretary in the report
accompanying such audited financial statement, an analysis of the
financial position and condition of the Federal Government, including
financial measures (such as the net operating cost, income, budget
deficits, or budget surpluses) and sustainability measures (such as the
long-term fiscal projection or social insurance projection) described
in such report.
(b) Effective Date.--The requirement under subsection (a) shall
apply with respect to any audited financial statement submitted on or
after the date of the enactment of this Act.
SEC. 204. REFORM OF SENATE BUDGET COMMITTEE.
In the Senate, the Committee on the Budget shall be composed of 15
members as follows:
(1) Six members who are a member of or caucus with the
political party in the majority in the Senate, of which 1 of
whom shall be designated as the Chairman by the members of the
committee.
(2) Five members who are a member of or caucus with the
political party in the minority in the Senate, of which 1 of
whom shall be designated as the Ranking Member by the members
of the committee.
(3) The Chairman and Ranking Member of the Committee on
Appropriations.
(4) The Chairman and Ranking Member of the Committee on
Finance.
VOTES OF THE JOINT SELECT
COMMITTEE ON BUDGET AND
APPROPRIATIONS PROCESS REFORM
----------
By unanimous consent, the Joint Select Committee on Budget
and Appropriations Process Reform applied a voting rule for the
adoption of amendments consistent with the rule required by law
for final adoption of the Joint Select Committee's
recommendations. Under that rule, passage or adoption required
separate majorities of the appointees from each party.
1. An amendment offered by Senator Bennett and Senator
Lankford to reform the membership of the Senate Budget
Committee. The amendment would reconstitute the
membership of the Senate Budget Committee to include 8
members from the majority and 7 members from the
minority in addition to the Chairs and Ranking Members
of both the Senate Appropriations and Finance
Committees.
The amendment was agreed to by a roll call vote of 7
ayes and 0 noes of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 6
ayes and 1 no of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 1
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... ..... ..... ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... ..... .......
----------------------------------------------------------------------------------------------------------------
2. An amendment offered by Representative Woodall to eliminate
functional categories in the budget resolution in lieu
of budget authority and outlays for the following
categories: nondefense discretionary spending, defense
discretionary spending, direct spending, and net
interest. The amendment would also require the
inclusion of a debt-to-GDP ratio.
The amendment was not agreed to by a roll call vote of
7 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 7 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 2
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... ..... ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... ..... .......
----------------------------------------------------------------------------------------------------------------
3. An amendment offered by Senator Whitehouse, Senator Blunt,
and Senator Perdue to establish an optional bipartisan
path for the budget resolution in the Senate.
The amendment was agreed to by a roll call vote of 7
ayes and 0 noes of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 7
ayes and 0 noes of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 3
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... ..... ..... ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... ..... .......
----------------------------------------------------------------------------------------------------------------
4. An amendment offered by Senator Schatz to include tax
expenditures in the list of subtotals reported in the
biennial budget.
The amendment was not agreed to by a roll call vote of
3 ayes and 5 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 7 ayes and 0 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 4
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... ..... X ....... Senator Whitehouse....... ..... ..... .......
Rep. Sessions.......................... ..... X ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... ..... X ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
5. An amendment offered by Senator Perdue to increase the
threshold for passing the budget resolution in the
Senate from a simple majority (51 votes) to a super
majority (60 votes).
The amendment was not agreed to by a roll call vote of
3 ayes and 4 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 8 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 5
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... ..... X ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... ..... ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... ..... X ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
6. An amendment offered by Senator Perdue to turn 50 hours of
debate on the budget resolution in the Senate into 50
hours of consideration.
The amendment was not agreed to by a roll call vote of
7 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 8 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 6
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... ..... ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
7. An amendment offered by Representative Kilmer to prohibit
any reconciliation bill that would cause or increase a
deficit or reduce a surplus over the period of years
covered by the reconciliation instructions in the
budget resolution.
The amendment was not agreed to by a roll call vote of
0 ayes and 8 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 8 ayes and 0 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 7
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... ..... X ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... ..... X ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... ..... X ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... ..... X ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... ..... X ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... ..... X ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
8. An amendment offered by Senator Lankford to include
reconciliation directives as a required element in the
contents of the budget resolution.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 7 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 8
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... ..... .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
9. An amendment offered by Senator Lankford to make
reconciliation a mandatory element of the budget
resolution. The amendment would also establish a new 20
percent limitation on provisions in a reconciliation
bill that either increase direct spending or reduce
revenues beyond 20 percent of the gross savings in the
budget resolution's reconciliation directives.
The amendment was not agreed to by a roll call vote of
6 ayes and 2 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 7 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 9
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... ..... .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
10. An amendment offered by Senator Blunt, Senator Whitehouse,
and Representative Woodall to maintain annual
reconciliation.
The amendment was agreed to by a roll call vote of 8
ayes and 0 noes of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 8
ayes and 0 noes of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 10
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
11. An amendment offered by Representative Sessions to
establish a permanent bipartisan, bicameral debt
reduction committee.
The amendment was not agreed to by a roll call vote of
7 ayes and 1 no of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 1
aye and 7 noes of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 11
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... X .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... ..... X ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
12. An amendment offered by Senator Hirono to authorize the
Treasury Secretary to suspend the debt ceiling.
The amendment was not agreed to by a roll call vote of
0 ayes and 7 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 6 ayes and 0 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 12
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... ..... ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... ..... X ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... ..... X ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... ..... X ....... Rep. Roybal-Allard....... ..... ..... .......
Senator Lankford....................... ..... X ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... ..... X ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
13. An amendment offered by Representative Arrington and
Senator Lankford to limit and ultimately phase out the
use of changes in mandatory programs (CHIMPs).
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 13
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
14. An amendment offered by Representative Kilmer to require
the House and Senate Budget Committees to hold a joint
committee hearing on the Fiscal State of the Nation.
The amendment was agreed to by a roll call vote of 8
ayes and 0 noes of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 6
ayes and 0 noes of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 14
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
15. An amendment offered by Senator Schatz to include total
outlays and revenues for tax expenditures as an
optional item in the budget resolution.
The amendment was agreed to by a roll call vote of 8
ayes and 0 noes of the Members appointed by the Speaker
of the House and the Senate Majority Leader and of 6
ayes and 0 noes of the Members appointed by the House
Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 15
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... ..... .......
Senator Lankford....................... X ..... ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
16. An amendment offered by Senator Perdue to align the fiscal
year with the calendar year and incorporate milestones
into the funding process connected with penalties. The
milestones are based on a percentage of completion of
funding bills signed into law (25/50/75/100). The
penalties connected with these milestones includes no
recess or use of official funds for member travel if
these funding milestones are not met.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 0 ayes and 7 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 16
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
17. An amendment offered by Senator Perdue to incorporate
milestones into the funding process connected with
penalties. The milestones are based on a percentage of
completion of funding bills signed into law (25/50/75/
100). The penalties connected with these milestones
includes no recess or use of official funds for member
travel if these funding milestones are not met.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 1 aye and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 17
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
18. An amendment offered by Senator Ernst and Senator Lankford
to establish live quorum calls if the Senate fails to
adopt a budget resolution by May 1st or fails to pass
all regular appropriations bills by October 1st.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 1 aye and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 18
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
19. An amendment offered by Senator Ernst to prohibit the
Senate from recessing or adjourning if it fails to pass
all regular appropriations bills by October 1st of each
year.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 1 aye and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 19
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
20. An amendment offered by Senator Ernst to prohibit the
Senate from recessing or adjourning if it fails to pass
a budget resolution by May 1st of an odd-numbered
calendar year.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 1 aye and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 20
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
21. An amendment offered by Senator Ernst to prohibit the
obligation or expenditure of funds for official travel
by a Senator if the Senate fails to adopt a budget
resolution by May 1st of each odd-numbered year or all
appropriation bills individually or collectively, by
October 1st of each year.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 1 aye and 6 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 21
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
22. An amendment offered by Representative Arrington,
Representative Kilmer, and Senator Ernst to expand the
prohibition against adjournment resolutions in the
House to include the August recess.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 2 ayes and 5 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 22
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... ..... X .......
----------------------------------------------------------------------------------------------------------------
23. An amendment offered by Senator Perdue to align the fiscal
year with the calendar year.
The amendment was not agreed to by a roll call vote of
8 ayes and 0 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 2 ayes and 5 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 23
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... X .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... X .......
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... X ..... ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... X .......
Senator Lankford....................... X ..... ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. ..... X .......
Senator Ernst.......................... X ..... ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
24. An amendment offered by Representative Roybal-Allard on
behalf of Representative Yarmuth to repeal the
statutory discretionary spending limits.
The amendment was not agreed to by a roll call vote of
1 aye and 7 noes of the Members appointed by the
Speaker of the House and the Senate Majority Leader and
of 7 ayes and 0 noes of the Members appointed by the
House Minority Leader and the Senate Minority Leader.
ROLL CALL VOTE NO. 24
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ ..... X ....... Co-Chair Lowey........... X ..... .......
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... X ..... .......
Rep. Sessions.......................... ..... X ....... Rep. Yarmuth............. ..... ..... .......
Senator Perdue......................... ..... X ....... Senator Bennet........... X ..... .......
Rep. Woodall........................... ..... X ....... Rep. Roybal-Allard....... X ..... .......
Senator Lankford....................... ..... X ....... Senator Schatz........... X ..... .......
Rep. Arrington......................... ..... X ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... ..... X ....... Senator Hirono........... X ..... .......
----------------------------------------------------------------------------------------------------------------
25. Vote on the bill as amended and the report as amended.
The bill and report as amended was not agreed to by a
roll call vote of 1 aye and 7 noes of the Members
appointed by the Speaker of the House and the Senate
Majority Leader and of 7 ayes and 0 noes of the Members
appointed by the House Minority Leader and the Senate
Minority Leader.
ROLL CALL VOTE NO. 25
----------------------------------------------------------------------------------------------------------------
Republicans Aye No Present Democrats Aye No Present
----------------------------------------------------------------------------------------------------------------
Co-Chair Womack........................ X ..... ....... Co-Chair Lowey........... ..... ..... X
Senator Blunt.......................... X ..... ....... Senator Whitehouse....... ..... ..... X
Rep. Sessions.......................... X ..... ....... Rep. Yarmuth............. X ..... .......
Senator Perdue......................... ..... X ....... Senator Bennet........... ..... X .......
Rep. Woodall........................... X ..... ....... Rep. Roybal-Allard....... ..... ..... X
Senator Lankford....................... ..... X ....... Senator Schatz........... ..... X .......
Rep. Arrington......................... X ..... ....... Rep. Kilmer.............. X ..... .......
Senator Ernst.......................... ..... X ....... Senator Hirono........... ..... ..... X
----------------------------------------------------------------------------------------------------------------
APPENDIX
----------
This appendix includes five items produced by the Joint
Select Committee on Budget and Appropriations Process Reform
(JSCBAPR). The first consists of the complete transcripts of
the five public hearings held by the JSCBAPR. The second and
third items are briefing materials prepared by the
Congressional Budget Office and the Congressional Research
Service for the JSCBAPR. The fourth is H.R. 7191, a bill
introduced by Representative Steve Womack, Chairman of the
House Committee on the Budget, and Representative John Yarmuth,
the Ranking Member of the House Committee on the Budget. This
bill reflects the work of the JSCBAPR and excludes only those
recommendations that dealt solely with Senate procedure and the
Senate Budget Committee. The final item is the press release
that accompanied the introduction of H.R. 7191.
Hearing Transcripts
Following the creation of the JSCBAPR in February 2018, the
Committee held five public hearings, fulfilling the requirement
in the BBA 2018.\12\ The JSCBAPR held the following hearings.
---------------------------------------------------------------------------
\12\ Id.
April 17, 2018--Opportunities to Significantly Improve the
---------------------------------------------------------------------------
Federal Budget Process
May 9, 2018--Bipartisanship in Budgeting
May 24, 2018--The Budget Resolution--Content, Timeliness, and
Enforcement
June 27, 2018--Members' Day
July 12, 2018--Opportunities to Improve the Appropriations
Process
A complete compilation of the transcripts of each of these
Hearings follows:
HEARINGS OF THE JOINT SELECT COMMITTEE
=======================================================================
JOINT SELECT COMMITTEE ON
BUDGET AND APPROPRIATIONS
PROCESS REFORM
ONE HUNDRED FIFTEENTH CONGRESS
SECOND SESSION
__________
HEARINGS HELD IN WASHINGTON, D.C., APRIL 17,
MAY 9, MAY 24, JUNE 27, AND JULY 12, 2018
__________
Serial No. 115-1
__________
Printed for the use of the Joint Select Committee
Available on the Internet:
www.govinfo.gov
JOINT SELECT COMMITTEE ON BUDGET AND
APPROPRIATIONS PROCESS REFORM
Republicans Democrats
REP. STEVE WOMACK, Arkansas REP. NITA LOWEY, New York
Co-Chair Co-Chair
SEN. ROY BLUNT, Missouri SEN. SHELDON WHITEHOUSE,
REP. PETE SESSIONS, Texas Rhode Island
SEN. DAVID PERDUE, Georgia REP. JOHN YARMUTH, Kentucky
REP. ROB WOODALL, Georgia SEN. MICHAEL BENNET, Colorado
SEN. JAMES LANKFORD, Oklahoma REP. LUCILLE ROYBAL-ALLARD,
REP. JODEY ARRINGTON, Texas California
SEN. JONI ERNST, Iowa SEN. BRIAN SCHATZ, Hawaii
REP. DEREK KILMER, Washington
SEN. MAZIE HIRONO, Hawaii
C O N T E N T S
Page
INTRODUCTION..................................................... 61
__________
APRIL 17, 2018
ORGANIZATIONAL MEETING FOLLOWED BY HEARING ON: OPPORTUNITIES TO
SIGNIFICANTLY IMPROVE THE FEDERAL BUDGET PROCESS............... 65
Hon. Steve Womack, Co-Chair, Joint Select Committee.......... 66
Prepared statement of.................................... 68
Hon. Nita M. Lowey, Co-Chair, Joint Select Committee......... 70
Prepared statement of.................................... 71
Martha Coven, J.D., Lecturer and John L. Weinberg/Goldman
Sachs & Co. Visiting Professor, Woodrow Wilson School of
Public and International Affairs, Princeton University..... 88
Prepared statement of.................................... 90
Douglas Holtz-Eakin, Ph.D., President, American Action Forum. 95
Prepared statement of.................................... 97
Hon. Lucille Roybal-Allard, Joint Select Committee, statement
submitted for the record................................... 126
Hon. Steve Womack, Co-Chair, Joint Select Committee,
questions to Ms. Martha Coven submitted for the record..... 127
Ms. Martha Coven's answers to questions submitted for the
record................................................. 128
Hon. Steve Womack, Co-Chair, Joint Select Committee,
questions to Dr. Douglas Holtz-Eakin submitted for the
record..................................................... 131
Dr. Douglas Holtz-Eakin's answers to questions submitted
for the record......................................... 132
Hon. David Perdue, Joint Select Committee, questions to Ms.
Martha Coven submitted for the record...................... 134
Ms. Martha Coven's answers to questions submitted for the
record................................................. 135
Hon. David Perdue, Joint Select Committee, questions to Dr.
Douglas Holtz-Eakin submitted for the record............... 137
Dr. Douglas Holtz-Eakin's answers to questions submitted
for the record......................................... 138
__________
MAY 9, 2018
BIPARTISANSHIP IN BUDGETING...................................... 139
Hon. Steve Womack, Co-Chair, Joint Select Committee.......... 139
Prepared statement of.................................... 140
Hon. Nita M. Lowey, Co-Chair, Joint Select Committee......... 141
Prepared statement of.................................... 142
G. William Hoagland, Senior Vice President, Bipartisan Policy
Center, U.S. Senate Staff 1982-2007........................ 143
Prepared statement of.................................... 146
Donald R. Wolfensberger, Fellow, Bipartisan Policy Center,
Fellow, Woodrow Wilson International Center for Scholars... 151
Prepared statement of.................................... 154
Supplemental statement of................................ 158
Emily Holubowich, Participant, Convergence Building a Better
Budget Process Project; Executive Director, Coalition for
Health Funding............................................. 162
Prepared statement of.................................... 164
Addendum to the Testimony of Emily Holubowich............ 167
Matt Owens, Participant, Convergence Building a Better Budget
Process Project, Vice President for Federal Relations and
Administration, Association of American Universities (AAU). 170
Prepared statement of.................................... 172
Hon. Sheldon Whitehouse, Joint Select Committee.............. 198
Letter submitted for the record.......................... 198
Hon. Sheldon Whitehouse, Joint Select Committee, question to
Emily J. Holubowich and M. Matthew Owens submitted for the
record..................................................... 204
Emily J. Holubowich and M. Matthew Owens's answer to a
question submitted for the record...................... 205
__________
MAY 24, 2018
THE BUDGET RESOLUTION--CONTENT, TIMELINESS, AND ENFORCEMENT...... 207
Hon. Steve Womack, Co-Chair, Joint Select Committee.......... 207
Prepared statement of.................................... 209
Hon. Nita M. Lowey, Co-Chair, Joint Select Committee......... 211
Prepared statement of.................................... 212
Maya MacGuineas, President, Committee for a Responsible
Federal Budget............................................. 213
Prepared statement of.................................... 216
James C. Capretta, Resident Fellow, Milton Friedman Chair,
American Enterprise Institute.............................. 224
Prepared statement of.................................... 226
Bill Dauster, Former Democratic Staff Director and Chief
Counsel, Senate Budget Committee........................... 236
Prepared statement of.................................... 238
Joseph White, Professor, Department of Political Science and
Center for Policy Studies, Case Western Reserve University. 242
Prepared statement of.................................... 244
Congressional Budget Office letter submitted for the
record................................................. 275
__________
JUNE 27, 2018
MEMBERS' DAY: HOW TO SIGNIFICANTLY REFORM THE BUDGET AND
APPROPRIATIONS PROCESS......................................... 301
Hon. Steve Womack, Co-Chair, Joint Select Committee.......... 301
Prepared statement of.................................... 303
Hon. Nita M. Lowey, Co-Chair, Joint Select Committee......... 304
Prepared statement of.................................... 305
Hon. Paul D. Ryan, Speaker of the House of Representatives
from the State of Wisconsin................................ 306
Prepared statement of.................................... 310
Hon. Nancy Pelosi, Democratic Minority Leader of the House of
Representatives from the State of California............... 316
Prepared statement of.................................... 320
Hon. Steny H. Hoyer, Democratic Whip of the House of
Representatives from the State of Maryland................. 324
Prepared statement of.................................... 327
Hon. Bob Corker, United States Senator from the State of
Tennessee.................................................. 329
Prepared statement of.................................... 331
Hon. Peter J. Visclosky, U.S. House of Representatives from
the State of Indiana....................................... 334
Prepared statement of.................................... 336
Hon. Devin Nunes, U.S. House of Representatives from the
State of California........................................ 340
Prepared statement of.................................... 342
Hon. Keith J. Rothfus, U.S. House of Representatives from the
State of Pennsylvania...................................... 344
Prepared statement of.................................... 346
Hon. Lloyd Smucker, U.S. House of Representatives from the
State of Pennsylvania...................................... 348
Prepared statement of.................................... 350
Hon. Warren Davidson, U.S. House of Representatives from the
State of Ohio.............................................. 353
Prepared statement of.................................... 355
Hon. J. French Hill, U.S. House of Representatives from the
State of Arkansas.......................................... 357
Prepared statement of.................................... 359
Hon. James B. Renacci, U.S. House of Representatives from the
State of Ohio.............................................. 363
Prepared statement of.................................... 365
Hon. Pramila Jayapal, U.S. House of Representatives from the
State of Washington........................................ 368
Prepared statement of.................................... 371
Hon. David E. Price, U.S. House of Representatives from the
State of North Carolina.................................... 373
Prepared statement of.................................... 376
Hon. Steve Daines, United States Senator from the State of
Montana.................................................... 382
Prepared statement of.................................... 385
Hon. Robert B. Aderholt, U.S. House of Representatives from
the State of Alabama....................................... 390
Prepared statement of.................................... 392
Hon. Elizabeth H. Esty, U.S. House of Representatives from
the State of Connecticut................................... 399
Prepared statement of.................................... 401
Hon. Tom McClintock, U.S. House of Representatives from the
State of California........................................ 405
Prepared statement of.................................... 407
Hon. Bill Foster, U.S. House of Representatives from the
State of Illinois.......................................... 410
Prepared statement of.................................... 412
Hon. Bruce Westerman, U.S. House of Representatives from the
State of Arkansas.......................................... 414
Prepared statement of.................................... 416
Hon. John Curtis, U.S. House of Representatives from the
State of Utah.............................................. 421
Prepared statement of.................................... 423
Hon. Jim Himes, U.S. House of Representatives from the State
of Connecticut............................................. 426
Prepared statement of.................................... 428
Hon. Roger Marshall, U.S. House of Representatives from the
State of Kansas............................................ 430
Prepared statement of.................................... 432
Hon. Hal Rogers, U.S. House of Representatives from the State
of Kentucky................................................ 434
Prepared statement of.................................... 436
Hon. Daniel Webster, U.S. House of Representatives from the
State of Florida........................................... 442
Prepared statement of.................................... 444
Hon. Ralph Norman, U.S. House of Representatives from the
State of South Carolina.................................... 446
Prepared statement of.................................... 448
Additional statements submitted for the record:
...................................................
Hon. Rob Bishop, U.S. House of Representatives from the
State of Utah.......................................... 450
Hon. John Carter, U.S. House of Representatives from the
State of Texas......................................... 459
Hon. Bradley Byrne, U.S. House of Representatives from
the State of Alabama and Hon. Paul Mitchell, U.S. House
of Representatives from the State of Michigan.......... 462
Hon. Mario Diaz-Balart, U.S. House of Representatives
from the State of Florida.............................. 470
Hon. Virginia Foxx, U.S. House of Representatives from
the State of North Carolina............................ 473
Hon. Dean Heller, United States Senator from the State of
Nevada, submitted a letter for the record.............. 477
__________
JULY 12, 2018
OPPORTUNITIES TO IMPROVE THE APPROPRIATIONS PROCESS.............. 479
Hon. Steve Womack, Co-Chair, Joint Select Committee.......... 479
Prepared statement of.................................... 481
Hon. Nita M. Lowey, Co-Chair, Joint Select Committee......... 483
Prepared statement of.................................... 484
Hon. Leon E. Panetta, Former Secretary of Defense, 2011-2013;
Chairman, The Panetta Institute for Public Policy and
Former Secretary of Defense................................ 485
Prepared statement of.................................... 489
Hon. David R. Obey, Former Chairman of House Appropriations
Committee, 2007-2011....................................... 498
Prepared statement of.................................... 501
INTRODUCTION
----------
The Joint Select Committee on Budget
and Appropriations Process Reform
The Joint Select Committee on Budget and Appropriations Process
Reform (JSCBAPR) was established by the Bipartisan Budget Act
of 2018 (BBA 2018), which was signed into law on February 9,
2018.\1\ The JSCBAPR is a bipartisan and bicameral panel tasked
with considering and recommending legislative language that
will ``significantly reform the budget and appropriation
process.'' The JSCBAPR is comprised of 16 members, equally
divided between the House and Senate. Four members each were
appointed by the Speaker of the House, the Senate Majority
Leader, the House Minority Leader, and the Senate Minority
Leader. House Budget Committee Chairman Steve Womack (R-AR) and
House Appropriations Ranking Member Nita Lowey (D-NY) serve as
co-chairs of this panel.
---------------------------------------------------------------------------
\1\ Bipartisan Budget Act of 2018, P.L. 115-123 (2018).
Members Appointed by the Speaker:
Representative Steve Womack (AR-3)
Representative Pete Sessions (TX-32)
Representative Rob Woodall (GA-7)
Representative Jodey Arrington (TX-19)
Members Appointed by the House Minority Leader:
Representative Nita Lowey (NY-17)
Representative John Yarmuth (KY-3)
Representative Lucille Roybal-Allard (CA-40)
Representative Derek Kilmer (WA-6)
Members Appointed by the Senate Majority Leader:
Senator Roy Blunt (MO)
Senator David Perdue (GA)
Senator James Lankford (OK)
Senator Joni Ernst (IA)
Members Appointed by the Senate Minority Leader:
Senator Sheldon Whitehouse (RI)
Senator Michael Bennet (CO)
Senate Brian Schatz (HI)
Senator Mazie Hirono (HI)
The deadline for the JSCBAPR to vote on recommendations,
legislative language, and an accompanying report was November
30, 2018.\2\ For the JSCBAPR to report recommendations,
including legislative language and an accompanying report, it
required votes of a majority of the committee members appointed
by the Speaker of the House of Representatives and the Majority
Leader of the Senate; and a majority of the committee members
appointed by the Minority Leader of the House of
Representatives and the Minority Leader of the Senate.\3\ This
voting threshold was intended to ensure that these
recommendations and this report are comprised of bipartisan
solutions.
---------------------------------------------------------------------------
\2\ Id.
\3\ Id.
---------------------------------------------------------------------------
Purpose
JSCBAPR was created in part because Congress has not followed
regular order for the congressional budget and appropriations
processes for more than two decades. Fiscal year 1995 was the
last time Congress passed a conference report on the budget
resolution and thirteen separate appropriations bills before
the beginning of the fiscal year.\4\ Congress has continually
failed to complete its work before the start of the fiscal year
and as a result, continuing resolutions (CRs) have become the
norm for funding the federal government.
---------------------------------------------------------------------------
\4\ Grant A. Driessen, The Federal Budget: Overview and Issues for
FY2019 and Beyond, Congressional Research Service, May 21, 2018.
Members have also expressed concerns regarding the lack of
legislative tools available for Congress to address the
national debt in a bipartisan manner. In 2018, the national
debt eclipsed $21 trillion and is projected to rise to $34
trillion by 2028 unless Congress acts. The JSCBAPR viewed its
purpose through the lens of these challenges: a broken budget
process and an unsustainable fiscal trajectory.
Hearings
Following the creation of the JSCBAPR in February 2018, the
Committee held five public hearings, fulfilling the requirement
in the BBA 2018.\5\ In addition to these public hearings, the
JSCBAPR has also held two closed briefings and multiple formal
and informal meetings. The JSCBAPR held the following hearings.
---------------------------------------------------------------------------
\5\ Id.
April 17, 2018--Opportunities to Significantly Improve the
---------------------------------------------------------------------------
Federal Budget Process
During this hearing, members considered the current challenges
facing the budget and appropriations processes in Congress and
discussed possibilities for improvement. Witnesses included:
Douglas Holtz-Eakin, Ph.D., President, American
Action Forum
Martha Coven, J.D., Lecturer and John L. Weinberg/
Goldman Sachs & Co. Visiting Professor, Woodrow Wilson School
of Public and International Affairs, Princeton University
May 9, 2018--Bipartisanship in Budgeting
During this hearing, members discussed ways to ensure that the
budget and appropriations processes work in a bipartisan manner
and are effective regardless of political dynamics. Witnesses
included:
G. William Hoagland, Senior Vice President,
Bipartisan Policy Center
Donald R. Wolfensberger, Fellow, Bipartisan Policy
Center; Fellow, Woodrow Wilson International Center for
Scholars
Emily Holubowich, Participant, Convergence Building
a Better Budget Process Project; Executive Director, Coalition
for Health Funding
Matt Owens, Participant, Convergence Building a
Better Budget Process Project; Vice President for Federal
Relations and Administration, Association of American
Universities (AAU)
May 24, 2018--The Budget Resolution--Content, Timeliness, and
Enforcement
During this hearing, members examined the current purpose and
role of the budget resolution and considered possible options,
presented by expert witnesses, to bolster the budget
resolution's impact and influence in the federal budget and
appropriations processes. Witnesses included:
Maya MacGuineas, President, Committee for a
Responsible Federal Budget
James C. Capretta, Resident Fellow and Milton
Friedman Chair, American Enterprise Institute
Bill Dauster, Former Democratic Staff Director and
Chief Counsel, Senate Budget Committee
Joseph White, Professor, Department of Political
Science and Center for Policy Studies, Case Western Reserve
University
June 27, 2018--Members' Day
During this hearing, members of both chambers of Congress
testified before the JSCBAPR on their ideas for improving the
budget and appropriations processes. Members who testified
before the JSCBAPR included:
The Honorable Paul D. Ryan, Speaker of the House of
Representatives
The Honorable Nancy P. Pelosi, Democratic Minority
Leader of the House of Representatives
The Honorable Steny H. Hoyer, Democratic Whip of the
House of Representatives
Representative Hal Rogers (KY-05)
Representative Pete Visclosky (IN-01)
Representative Robert Aderholt (AL-04)
Representative David Price (NC-04)
Representative Rob Bishop (UT-01)
Representative John Carter (TX-31)
Representative Devin Nunes (CA-22)
Senator Bob Corker (TN)
Representative Jim Himes (CT-04)
Representative Tom McClintock (CA-04)
Representative Jim Renacci (OH-16)
Representative Daniel Webster (FL-11)
Representative Elizabeth Esty (CT-05)
Representative Bill Foster (IL-11)
Representative Keith Rothfus (PA-12)
Senator Steve Daines (MT)
Representative French Hill (AR-02)
Representative Bruce Westerman (AR-04)
Representative Warren Davidson (OH-08)
Representative Pramila Jayapal (WA-07)
Representative Roger Marshall (KS-01)
Representative Lloyd Smucker (PA-16)
Representative John Curtis (UT-03)
Representative Ralph Norman (SC-05)
Additional statements submitted for the record:
Representative Virginia Foxx (NC-05)
Representative Mario Diaz-Balart (FL-25)
Senator Dean Heller (NV)
Representative Bradley Byrne (AL-01)
Representative Paul Mitchell (MI-10)
July 12, 2018--Opportunities to Improve the Appropriations
Process
During this hearing, members considered the current challenges
facing the appropriations process in Congress and discussed
possibilities for improvement. Witnesses included:
The Honorable Leon Panetta, Former Secretary of
Defense, 2011-2013; Chairman, The Panetta Institute for Public
Policy and Former Secretary of Defense
The Honorable David Obey, Former Chairman of House
Appropriations Committee, 2007-2011
ORGANIZATIONAL MEETING FOLLOWED BY HEARING ON: OPPORTUNITIES TO
SIGNIFICANTLY IMPROVE THE FEDERAL BUDGET PROCESS
----------
TUESDAY, APRIL 17, 2018
House of Representatives,
Joint Select Committee on Budget and
Appropriations Process Reform,
Washington, D.C.
The committee met, pursuant to call, at 10:32 a.m. in Room
HVC-210, Capitol Visitor Center, Hon. Steve Womack and Hon.
Nita M. Lowey [co-chairs of the committee] presiding.
Present: Representatives Womack, Sessions, Woodall,
Arrington, Lowey, Yarmuth, Roybal-Allard, and Kilmer.
Senators Blunt, Perdue, Lankford, Ernst, Whitehouse,
Bennet, Schatz, and Hirono.
Co-Chair Womack. Good morning. The committee will come to
order.
I want to welcome everyone, and welcome to the first public
hearing of the Joint Select Committee on Budget and
Appropriations Process Reform. Before we begin our hearing, we
will first conduct the organizational meeting.
After our administrative business, the co-chair and I
intend to recognize members for opening statements. I encourage
opening statements at the hearing. In future hearings we hope
to minimize them.
Finally, we will hear from our distinguished witnesses who
have joined us.
Before we consider the committee's rules, we would like to
designate the committee's staff director. Pursuant to the co-
chair's authority under the Bipartisan Budget Act of 2018, Dan
Keniry, who currently serves as the staff director for the
House Budget Committee, will serve as the Joint Select
Committee staff director, with the understanding that he will
consult with David Reich, counsel to Co-Chair Lowey.
We will now consider the committee's rules of procedure.
The proposed rules have been shared with all members of the
committee. These rules set out the committee's procedures and
are consistent with both House rules and the Bipartisan Budget
Act of 2018. If there are any questions, staff are available to
answer those queries.
The committee will now proceed to the consideration of the
committee rules package. My understanding is that we will have
no amendments. So I would like to move from the chair to the
adoption of the rule.
Senator Lankford. Mr. Chairman, can I ask one question, a
parliamentary inquiry?
Co-Chair Womack. The gentleman will state his inquiry.
Senator Lankford. My question was I had raised before just
a clarification on what a majority is. The way the actual bill
was written is it is unclear whether a majority--it is a
majority from each party or a majority total. So that could be
10 people to pass the final product or 12 people. Has that been
clarified yet?
Co-Chair Womack. Based on guidance that the co-chairs have
received, 10 votes total, including a minimum of 5 Republicans
and 5 Democrats, are required to report the committee's
legislative recommendations and report.
Senator Lankford. Thank you. Thanks for putting that on the
record.
Co-Chair Womack. Thank you.
Today's formal hearing record will provide this guidance.
Co-Chair Lowey. Mr. Chairman, our staffs have consulted
regarding these rules. We are both in agreement. This is a
pretty simple, plain vanilla package. The committee will be
fundamentally guided by the legislation that set it up, but
these rules provide a useful supplement. So I move that the
proposed rules be adopted and that the co-chairs be authorized
to submit them for printing in the Congressional Record.
Co-Chair Womack. Within a timeframe specific? Thirty days?
Co-Chair Lowey. Correct.
Co-Chair Womack. Okay.
Is there any debate on the motion by the co-chair?
If not, the question is on the motion offered by the
gentlelady from New York.
All those in favor, say aye.
Those opposed, no.
The ayes have it. The rules package is adopted.
That concludes the business portion of the meeting.
Now we will begin the hearing portion of the meeting, and I
yield myself 5 minutes.
Established by the Bipartisan Budget Act of 2018, our panel
of 16 members is charged with the task of significantly
reforming the budget and appropriations process. Prior to this
hearing, our panel has met twice to start the conversation and
identify the problems. While this Select Committee is comprised
of a diversity of political thought, we have clearly shared a
common goal from the start. We believe that the current process
isn't working, and reform is long overdue.
Perhaps the most visible sign of dysfunction is that
Congress has not followed regular order for the budget process
for more than 20 years. Fiscal 1995 was the last time Congress
passed a budget conference agreement followed by all of the
separate appropriation bills before the beginning of the fiscal
year.
Since then it has become commonplace for Congress to rely
on short-term funding measures and continuing resolutions in
order to avoid government shutdowns, and even those efforts
have not always been successful.
It is our job to keep the government's lights on. We have
failed to do it five times. The most important role given to
Congress under the Constitution is the power of the purse. This
panel is charged with ensuring we can fulfill this essential
duty.
It is no mistake that our Constitution begins in Article I
by describing the powers and role of the legislative branch,
and I believe that any proposals of this panel should affirm
the distinct role intended by our Founding Fathers. Congress
should always be at the center of deciding budget and spending
issues for our nation.
While respecting the role of the other two branches of
government, any recommendations from this committee should
reflect improvements to the congressional process rather than
offer prescriptions for specific budgetary outcomes that
benefit Republicans or Democrats. Our goal is to ensure a
framework that works regardless of what party holds the
majority in either Chamber of Congress.
And it is my hope that we can come to agreement on
recommendations and ultimately develop legislation that
significantly reforms the budget and appropriations process. If
we can design a better budget process to allow Congress to more
effectively put forward its proposals, the budgetary outcomes
will ultimately be returned to the American people through the
elections.
While the Bipartisan Budget Act requires that our panel
come up with solutions by November 30, I believe we can and
should get agreement on solutions sooner. So in the coming days
and weeks, it is important that we quickly and thoughtfully
move through our work. As we identify possible solutions, I
urge my colleagues to bring up proposals that encourage and
incentivize the completion of budget and appropriations work on
time.
In recent years, there have been four 2-year budget
agreements. Our work should build on this trend, developing an
overarching framework for Congress and ensuring certainty for
funding decisions earlier.
I look forward to today's discussion with experts on the
advantages and disadvantages of various fixes. Today we will
have two esteemed witnesses to help talk us through ideas for
solutions.
I am pleased to welcome Dr. Douglas Holtz-Eakin, who was
appointed as Director of Congressional Budget Office in 2003
and led the agency for nearly 3 years. He served on President
George W. Bush's Council of Economic Advisers, and he is
currently president of the American Action Forum.
Also joining us is Martha Coven, who previously served at
the Office of Management and Budget and at the Domestic Policy
Council during the Obama administration. Prior to her work in
the executive branch, she spent several years at the Center on
Budget and Policy Priorities. Currently a lecturer and visiting
professor at Princeton University.
Thank you.
And with that, I yield to the distinguished co-chair, the
gentlelady from New York, Mrs. Lowey.
[The prepared statement of Co-Chair Womack follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Lowey. And I would like to say thank you and
welcome to Co-Chairman Womack, all of our members and
witnesses, to the first public meeting of the Joint Select
Committee.
We all have our discontents with the budget process. Having
recently emerged from the marathon negotiations over the 2018
omnibus appropriations package, I would put at the top of my
list not enacting spending bills until the fiscal year is half
over, our reliance on numerous short-term continuing
resolutions, and appropriations getting bogged down by
extraneous issues.
But the process itself, which has served Congress well in
the past, is not the fundamental cause of all these problems.
The root cause of our current situation has much more to do
with deep policy disagreements, often over issues that
shouldn't be part of appropriation bills and a lack of
political will.
Procedural reforms alone are insufficient. But perhaps an
improved process could facilitate reaching and implementing
agreements when there is the will to do so. And perhaps changes
to the process could help change some norms and expectations
about how we function. It is well worth consideration.
What kinds of problems should we be tackling? I would like
to find a way to reach much earlier agreement on topline totals
we need in order to make serious progress on appropriations
bills. Among other things, that would make consideration of
appropriation bills in the House and Senate much more
meaningful as we would be working with common totals and bills
more likely to be enacted, rather than leaving all that to the
last minute.
I would also like to find a better way of handling the debt
ceiling, a process that currently serves no useful purpose but
invites brinksmanship that menaces our economy. And I would
like to find ways to once again make budget resolutions more
meaningful and more useful.
I look forward to working with my colleagues on this panel
and to making progress on the task we have been given.
Thank you.
[The prepared statement of Co-Chair Lowey follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the Co-Chair.
We are in the opening statements' portion of this hearing,
and we will alternate House and Senate and Republican and
Democrat.
And with that, I will yield 5 minutes to the gentleman from
Georgia, Senator Perdue.
Senator Perdue. Thank you, Mr. Chairman.
I really am honored to be a part of this Select Committee.
I don't think there is anything this year that we are going to
do that will have a longer-term potential impact on the fiscal
nature of our country and our ability to do what we all want to
do. We are losing the right to do the right things financially.
First of all, my learned opinion after the last 3 years of
looking at this very, very closely is that our budget, and I am
going to include our funding process in the United States
Senate, is totally broken. While our appropriations process in
the House indeed does work, I agree with the Co-Chair, Mrs.
Lowey, that the lack of will keeps us from doing many things in
the Senate.
But I will argue this, that the budget process itself is
totally broken. April 15 was this past Sunday, 2 days ago. It
is a date that, in the Senate, we are supposed to have, by
statute, we are supposed to have the budget complete. We
haven't even talked about the budget yet this year, and I
indeed believe we will not do a budget this year, just like we
didn't do a budget last year and we didn't do a budget the year
before.
In 2015 we did a budget in the Senate. It took $7.5
trillion out of the future expenditures of the federal
government. But it was fake, it was partisan, and it only lived
for 4 months. It was waived in order to do the grand bargain so
that we could fund the government that fall.
The next year we deemed a budget so the Republicans could
get to reconciliation and do what they wanted to do at 51 votes
under the reconciliation law. Then last year we did the same
thing. So we attempted healthcare, we attempted taxes all under
reconciliation, which is part of the budget process. In my
opinion, reading the Budget Act of 1974, that is a bad way to
use, that is it is an improper use of the reconciliation rule.
But the reality is that results speak for themselves, Mr.
Chairman. Our budget process has only funded the government
four times by the end of the fiscal year in the last 44 years
since the 1974 Budget Act was put in place. Four times.
Actually, the federal government has been closed down 20 times
in the last 44 years because Congress did not fund the
government by the end of a due date, either the fiscal year or
the end of a continuing resolution.
We are supposed to in the Senate, since 2000, we are
supposed to appropriate 12 appropriation bills a year. The
truth is we have only averaged 2\1/2\ appropriation bills being
put on the floor of the Senate and passed in the Senate over
those 44 years, an average of 2\1/2\ out of 12.
Mr. Chairman, I would argue that there is no way anybody
can argue that this process does not need dramatic
revitalization. As a matter of fact, I think it takes a zero-
based budget approach to the budget process itself, and that is
a clean-page approach.
We are indeed in a crisis financially. We just passed $21
trillion. I would argue that we will not solve the debt crisis
unless and until we solve this budget process and funding
crisis that we have today.
In my opinion, other countries have to fund their
government on time. And many countries, their constitution says
that if you don't fund the government by the end of the current
fiscal year, they dissolve that particular government and they
form another one.
I just believe that we have release valves in our system
here that allow us in the Congress to not do our duty. The
number one responsibility of the U.S. Congress is to fund the
government. Article II very clearly lays out the
responsibilities of the executive branch. Nowhere in there, in
those itemized responsibilities, is to be involved in the
funding of the government or, indeed, providing budgetary
advice. The OMB Act of 1921 in many ways, in my view, violates
that Article II piece of the Constitution.
And so when I look at where we are today, we don't even
start this process until we get an executive branch budget. I
think that is wrong. I personally believe there is no higher
calling right now for the United States Congress than to
finally face up to the failure of this Budget Act of 1974, take
a clean page approach, and finally, once and for all, develop a
politically neutral platform that allows us to fund the
government on time without all this drama and without creating
crisis for the rest of the world regarding what are we going to
do in terms of funding the federal government the next year.
Thank you, Mr. Chairman.
Co-Chair Womack. I thank the gentleman.
The Senator from Rhode Island, Mr. Whitehouse.
Senator Whitehouse. Thank you, Chairman. Thank you to you
and your Co-Chair, Representative Lowey, for your leadership of
this group. I hope that we are able to be effective and to
discharge our duties here.
I note that we are both Senators and House members, and the
Senate and the House have different perspectives and different
procedures. And the problem areas are budget and
appropriations, and budgeters and appropriators have different
procedures and perspectives.
I do believe there are some commonalities. I think we can
probably agree together that a 2-year budget cycle makes more
sense. We could perhaps even agree that a 2-year appropriations
cycle, perhaps staggered year to year, might make some sense.
We can perhaps agree that the executive branch doesn't need
to have a formal role in the budget timeframe and process, that
there is plenty of political interaction to take place so that
we don't need to boil that into our scheduling.
But I would just like to say a few words from my
perspective as a Senator who sits on the Senate Budget
Committee.
I would concur with Senator Perdue that the Senate Budget
Committee process is completely broken. It became ineffectual
when the Senate went to a 60-vote baseline for virtually
everything, and the penalty for violating the Senate budget is
60 votes. A fence that is at the level of the ground is no
fence at all.
Moreover, the Senate Budget Committee is the mechanism for
the delivery of reconciliation, which has been morphed over the
years away from its original purpose to become a general
partisan delivery system. Both sides, I think, need to stand
down on that and redirect the Senate Budget Committee to a
budget process.
Now, in order to do that, I think there are some baselines
that we have to achieve. The first is that we have to create
within the Senate Budget Committee at least the possibility of
a bipartisan process. Everything about the Senate process right
now pushes towards partisanship. We need to create a rule that
provides the option of traveling a bipartisan road.
If we can get over the hurdle of bipartisanship, then there
are some other things we need to consider. If we are going to
look at debt and deficit, we have to comply with the
mathematics of debt and deficit, which means you have to look
at appropriated spending, you have to look at healthcare
spending, you have to look at tax spending, and you have to
look at revenues.
If you are not looking at all of them, you are necessarily
mathematically incomplete, and it is virtually impossible to
get anything meaningful done.
I think everybody who has ever been before the Senate
Budget Committee has agreed that debt to GDP is the measure of
safety with respect to long-term debt and with respect to
regular deficits. So we need to do the basic task of deciding,
and I think we can do this, bipartisan fashion, what is a fair
and sustainable debt-to-GDP ratio.
And then how long is it going to take us to get there? You
don't land a plane by driving it straight down to the ground.
You have a glide slope. And we need to have a glide slope. And
what should that glide slope be? That is something I think we
can also agree to.
And then what are the warnings that let you know you are
off your landing path, that you are not on the glide slope? I
think we can install those as well.
If we have a bipartisan path that considers all those
elements, tracks us towards a sustainable debt-to-GDP ratio,
and warns the public when we are off course, I think we will
have accomplished a very significant task, and the Senate
Budget Committee will once again be somewhat useful.
I would close by echoing what Representative Lowey said
about the debt ceiling. I see the debt ceiling as like somebody
who put a bear trap in their bedroom. And they know they are
going to get up in the night, and if they are lucky, their
best-case scenario is that they avoid the bear trap.
There is no good that comes out of having that bear trap in
the bedroom. There is the chance that you step in it. And if
you step in it, it is a catastrophe.
If we can build through this process some sense of public
confidence that we have a track towards a sustainable debt-to-
GDP ratio, then perhaps we can undo this completely unhelpful,
completely manipulable, and dangerous debt ceiling process that
we go through, which appeals to the nature of our very worst
angels.
So with that, I look forward to working productively with
everyone. I do think it is important that we understand that
the Senate operates a little differently from the House, and
budget folks have different perspectives from appropriators.
And we all need to pull together to try to come up with
something that can solve this problem.
I think it is very doable, and I look forward to joining
all my terrific colleagues in doing it. And I thank you both
for your leadership.
Co-Chair Womack. Thank you, Senator.
Based on order of arrival, the next opening statement will
be given by the gentleman from Texas, Representative Arrington.
Representative Arrington. Thank you, Mr. Chairman and
Chairman Lowey, for your leadership to take on this daunting
task. I am grateful to join my distinguished colleagues in
solving what I believe is not a fundamental, but the
fundamental problem for Congress, the budget and appropriations
process.
We all start with one thing in common. We believe that the
process is broken, and I believe we are all truly committed to
fixing it and doing it in a bipartisan and bicameral fashion,
not just for our institutions, respectively, but for the
American people, more importantly. Because if there is one area
that I think highlights that Congress plays by a different set
of rules than the American people, it is certainly the budget
process.
All someone has to do is review the tape of the past reform
efforts, we went over that in painful detail last meeting, and
look at the budget outcomes to appreciate the abysmal failure
of past reform efforts and the Herculean challenge we have to
implement any meaningful reforms in this one.
If we don't do something to improve our situation, we will
not only fail our frustrated colleagues and ourselves, we will
fail our children. As a new member and a new generation
policymaker, I am convinced that getting to the right budgetary
outcome and the right budgetary process is the challenge of the
21st century. And if we stay on the current trajectory, I
believe that it is the biggest threat to our nation's future. I
don't think I could overstate that.
Whether your priorities include infrastructure and the
benefits to our economy in that regard, or the food supply and
the Farm Bill safety net that we are working on, I believe that
is important to food security, and R&D, as a former Vice
Chancellor for research, I know that helps our global
competitiveness, the list goes on and on. We all have our list
of what we believe are national priorities. I think we would
all agree on national defense.
But it is all going to be in jeopardy if we, God help us,
enter a sovereign debt crisis, not to mention the terrible
economic conditions we will thrust on the next generation of
Americans if we don't do something.
I don't think that an external threat is going to take this
country down. And when I say down, I mean lose our
exceptionalism. I think it is going to be like most great
civilizations, I think our most formidable foe is ourselves. I
think it is our inability to govern ourselves, in many ways,
but I think this being the greatest example. This inaptitude
for self-governance, self-restraint, self-discipline is
highlighted, again, I think most prominently in this process.
So it seems to me that we are either going to make the
sacrifices that other generations have made and muster the
courage to put our country's interest ahead of our own
political interest, or we are not going to have a choice. The
harsh and indiscriminate realities of a sovereign debt crisis
will force us to make the changes that we must make.
And that is a sad state of affairs, that we know the train
is heading for a collision. We know probably, I think
collectively, we know what needs to be done. Will we have the
courage to do it? Even in this group, even among this
committee, will we have the collective courage to do it?
Because if we do wait, we will have lost that privilege,
that unwritten pledge that we made when we took this office to
hand this country better than we found it to our children and
grandchildren.
What is our mission? I think, Mr. Chairman, we should start
with what is our task at hand? And it should be something that
we should be able to attain, but something that is aspirational
at the same time, and we will have to figure out the balance of
the two.
But it is simply to ensure a process that results in timely
and continuous funding for our government instead of this
stopgap shutdown show that we have seen that you guys have
described and my friend, Senator Perdue, described in his
opening statement.
I think the other component, I hope we can get there, I
believe we can, is to not just focus on the process, but to
ensure that we have the process, mechanisms, and incentives in
place for responsible and cost-effective budget outcomes. I
hope we can do that.
We have to learn from history. We have to learn from our
own experiences. But I believe fundamentally, and I hate to say
this, but actually I am going to lump myself in this, but
Congress as a whole and by nature I don't think has the
collective will to do this. We have to find ways to align
incentives. And if we do that, I think we will be successful.
I will yield back.
Co-Chair Womack. I thank the gentleman.
Next to the Commonwealth of Kentucky and the Ranking Member
on the House Budget Committee, the gentleman, Mr. Yarmuth.
Representative Yarmuth. Thank you very much, Mr. Chairman.
And I want to thank you and Co-Chair Lowey for getting this
process off to a very good start.
As I said in one of our initial meetings, I think it is key
that we focus on defining the problems we are seeking to fix.
And from the tenor and the substance of the opening remarks
that I have heard from our members so far, I can see where this
is going. This is going to be a situation in which everything
will have been said but not everybody has said it.
And I think that is actually very encouraging, because I
think it shows that this committee is committed to a very
serious nonpartisan approach to solving what is a very
difficult problem. And I find that very encouraging.
I think it has been said several times already that
whatever we propose should not be aimed at some kind of a
philosophical result or any kind of outcome. And I think that
is very positive in the way we ought to approach it.
I just have a couple of thoughts that have occurred to me,
and having been on the Budget Committee now for almost 10
years, one of the things that I think is very important is that
most people when they look at the federal budget think of it as
in terms of the context that they see elsewhere, a corporate
budget, a personal family budget.
And I think this is a mistake. I think a governmental
budget is something that is very, very different from a
business budget and from a personal family budget.
In the government, we have a responsibility for coming up
with a budget, but we are not the managers. The managers are
the voters.
We are also not the customers. The voters are the
customers. And we have to figure out what they want us to do.
Of course, that is part of our campaigns.
But it is a very different perspective when we are trying
to figure out what is an appropriate level of spending for
which categories when we are not the ones who are actually
finally ratifying our choices.
And the other thing that concerns me, and Senator
Whitehouse mentioned this as well, is that in practice revenues
have been totally detached from the budget process. And if you
are in a business, as I have been, when you are thinking about
what you want to accomplish in your business, other than making
money, you think about, first, what you want to accomplish.
I was in the newspaper business. I decided on what kind of
product I wanted to produce, and then I decided what resources
were necessary. If there weren't enough resources, I hired a
new sales manager or a new sales representative who would go
out and try to generate more income.
And I don't think we can view government quite the same
way, but we also can't ignore the fact that revenue is a very
critical part of what we do. And this process, at least as long
as I have been involved in it, has totally ignored revenue as a
component of the budget.
When we put out an alternative budget last year and the
year before that, the Democratic budget actually called for
increased revenues, and of course that lead to political
challenges from the other side. And I don't expect to hear that
in this process.
But that, I think, is something that we cannot fail to
recognize, that as much as expenditures are important, we have
expectations that our managers place on us. They know what they
want government to do for them. And we have to figure out not
only how to allocate money for those responsibilities, those
functions, but we also have to figure out how to generate the
revenue as well.
So once again I am very encouraged by the tenor of the
discussions so far in our prior meetings and today, and I look
forward to a very productive process.
I yield back.
Co-Chair Womack. Next to the State of Iowa and the
distinguished Senator, Ms. Ernst.
Senator Ernst. Thank you, Mr. Co-Chairman. And I truly am
thrilled to have the opportunity to serve on this committee.
The most fundamental role of Congress as laid out in
Article I, section 8 of the Constitution is to raise revenue
and fund the federal government. And, unfortunately, Congress
has consistently failed to execute this responsibility in a
timely or an effective manner.
As noted before, since 1974 Congress has only passed all of
its appropriations bills four times. Over the past 20 years we
have passed a budget resolution only 11 times. And since 1999
we are averaging five continuing resolutions per year. Five per
year.
Unsurprisingly, our dysfunctional process has also yielded
dysfunctional outcomes, growing deficits and $21 trillion in
debt. This ineffectiveness is not only bad governance, it is a
threat to our national security.
Our reliance on continuing resolutions has a devastating
effect on our military. As a result of our continued reliance
on continuing resolutions, only 3 of the Army's 31 brigade
combat teams are capable of deploying immediately to conflict.
During continuing resolutions, the Army has $400 million less
per month in their operating accounts.
Richard Spencer, the Secretary of the Navy, has said that
inefficiencies stemming from continuing resolutions have
consulted in $4 billion in waste for the Navy since 2011.
Our constituents deserve better than this cycle of
governing crisis to crisis, and I look forward to working with
my colleagues in a bipartisan manner to put in place reforms to
get our budget and appropriations process working again.
Again, I am thrilled to have the opportunity to spend this
time with my colleagues working towards, again, a bipartisan
fix to this very devastating situation.
So again, thank you, Mr. Co-Chair. And I will yield.
Co-Chair Womack. The gentleman from Colorado, Senator
Bennet.
Senator Bennet. Thank you, Mr. Chairman. And thank you and
your Co-Chair for such an encouraging start. I appreciate the
comments of my colleagues.
When I first came to the Senate, I was a little more
optimistic than I am today about the ability of Congress to
deal with our long-term fiscal challenges. By coming together,
I thought we would figure out ways to pay for investments in
the future while curbing spending to stay within our means. In
other words, I thought there was a bipartisan commitment to do
for our kids and grandkids what our grandparents had done for
us.
Unfortunately, as we have heard today in a bipartisan way,
Congress has excelled over and over again taking the path of
least resistance. We have had, I think by my count, roughly 39
continuing resolutions since I became a member of the United
States Senate.
And following recent tax and spending decisions by
Congress, we are now on a path to have the largest deficits
outside of a recession since World War II. The Congressional
Budget Office now projects that even as we are approaching full
employment we will have deficits approaching $1 trillion next
year and on track to grow every year after that.
At some point, the growing gap between spending and revenue
will catch up with us if we don't do anything and will
certainly catch up with the next generation of Americans.
In the meantime, we are grinding down the parts of our
government vital to our future--education, innovation,
infrastructure, and efforts to reduce child poverty--and we are
putting at risk the obligations we have made to our seniors,
our veterans, and most vulnerable, including Medicare,
Medicare, and Social Security.
Mr. Chairman, I am under no illusion that reforming our
budget process is a silver bullet to address the toxic levels
of partisanship that seem to infect, for no good reason,
everything we do around here. And no process reform can produce
the political courage needed to take on the tough fiscal
challenges that we face. But I do believe this committee can
make important bipartisan progress and demonstrate leadership.
I hope that we will work in good faith. We have a rare
opportunity to do that on this committee. My hope is that all
of us will keep an open mind and remain constructive in the
face of hard and inevitable differences.
Here are a few areas that I think we could think about
working together.
We might create more predictability for appropriators by
putting in place a 2-year cycle for topline discretionary
spending levels through so-called biennial budgeting.
We will also need to come up with reasonable enforcement
mechanisms that are a constructive push for us to act within
deadlines.
We should consider creating an appropriations process that
is more predictable and inclusive, one that encourages
bipartisan work, not partisan work, and limits the meaningless
showboats that have become an unfortunate tradition around
here.
Lastly, we should de-weaponize the debt limit. Senator
Schatz and I have a bill to eliminate the debt limit entirely
since it serves no purpose other than risking default. I am
open to considering alternative mechanisms to focus our
attention on our actual fiscal problems while eliminating the
threat of default once and for all. We should be responsible
when we decide revenue and spending levels instead of trying to
walk out on a bill when it comes due.
I look forward to working with you, Mr. Chairman, and all
of my colleagues up here to see where we can make progress, to
see where we can make a difference. And I hope that we can show
the world that even in these troubled times bipartisan progress
really is possible.
Thank you, Mr. Chairman.
Chairman Womack. The gentleman from Georgia, Mr. Woodall.
Representative Woodall. Thank you, Mr. Chairman. I thank
you and our Co-Chairman for our leadership here. I appreciate
Speaker Ryan entrusting me with a spot on this committee.
My very first vote of significance, Mr. Chairman, that I
took in this institution back in 2011, you will remember it,
you were a freshman as I was, was the vote for the Budget
Control Act that created the last Joint Select Committee that
had a chance to make a difference here.
And I was so excited. We only had two Republicans in
Georgia who supported that bill. I was so excited. I knew I was
going to get defeated without question, but I knew I was going
to have an opportunity to move the needle for our children and
our grandchildren, which is what everybody has been talking
about.
I can't tell you the disappointment I had when that
committee adjourned having agreed on absolutely nothing. Now,
we entrusted, the Congress entrusted that committee with
looking at the entire budget over a decade-upon-decade-long
window, and they couldn't find a thing to do to make anything
better for anybody.
I would tell you the men and women of that committee I am
sure regret that today and found themselves in a political
environment that made that difficult.
Mr. Chairman, everything I have heard from every member on
this committee in the times we have gathered has led me to
conclude we are not going to meet that same fate.
To my friend from Texas' point, we have big, lofty
aspirational goals that I hope that we will achieve. I believe
that we can.
But we also have those areas of fundamental agreement, as
the Senator from Colorado pointed out, that we absolutely can
achieve. There are some floors on our success as well. And I
recognize that this is an opportunity that many of us came to
Congress to be a part of, doing those things that otherwise
would be unable to be done.
And I want to encourage my colleagues. We talk about our
current situation as if we are experiencing something that no
generation before us has experienced, as if we are the first
ones to overpromise and underdeliver, to cut taxes while
promising new benefits.
I will remind everyone of the story of Ida May Fuller, the
very first woman to ever receive a Social Security pension.
Those were our colleagues in 1935 that made those promises on
behalf of a nation.
And Ida May Fuller worked for 3 years under the Social
Security system, paid in just over $24 in her 3 years. Her very
first Social Security pension check was for just over $22, and
she received that benefit over a lifetime that ultimately paid
her almost $23,000 in Social Security benefits.
So lest you think that our track record together is not
that praiseworthy, I will tell you, we have not made $22
commitments for which we have paid out $22,000 in exchange.
This has long been a problem. And much of the burden that is on
us today is to solve problems not that we have created, but
that previous generations of Members of Congress have created.
And I am pleased to be a part of that.
I appreciate the discussion of a glide slope forward, that
we are not going to be able to get this all done overnight.
But I think back to the Social Security amendments of 1983,
another big vote that folks thought they would lose their seats
over, restored solvency to the Social Security trust fund for
decades, raised taxes, reduced benefits in many cases, but took
effect far enough out into the future that folks had a chance
to plan.
I have read the testimony of both of our witnesses. Both
suggest that we have process problems, flawed processes produce
flawed products, and process problems that lead us to tools
that were supposed to be productive and we use them in
gimmickry fashions today.
I think that much of our job, Mr. Chairman, is to build
trust. I have often commented on Chairman Lowey and the trust
that she builds on the Appropriations Committee, and we have a
chance to do that.
I would just close with a cautionary tale, though. I have
never served on the United States Senate. I have spent a decade
as a chief of staff on the House side, a decade as a member. I
don't have any idea the challenges that go on in the United
States Senate. But I hear the mention of the debt ceiling over
and over again.
You know, on the House side, that provides a minority voice
opportunity in ways that otherwise the minority has no voice on
the House side. Whether you are in the Progressive Caucus or
whether you are in the Freedom Caucus, a debt ceiling
conversation allows a stop in the process and requires that
folks come together. Every single debt ceiling increase, Mr.
Chairman, since you and I have come to Congress has resulted in
moving the needle for more responsible spending or more
responsible governing, every single time.
I think we have to think through those challenges that
obviously create lots of headaches. But sometimes those
headaches are designed to create opportunities.
And I yield back.
Co-Chair Womack. The gentleman from Washington, Mr. Kilmer.
Representative Kilmer. Thanks, Mr. Chairman. And I thank
both of our Co-Chairs for your leadership on this.
In the fall of 2012, I came to freshman orientation. I was
elected for the first time. And they had a presentation from
the Congressional Research Service to talk about how the budget
process works.
And after explaining the rules and the timelines in
tremendous detail, they then said, ``But it never actually
works that way. Let us tell you how it actually works.'' And I
understand you have a similar experience teaching at Princeton.
I have only served in Congress for 5 years, but I have
spent a lot of time over the last few weeks trying to think
through the budget process as I prepared to serve on this
committee. And I think I have an idea why Congress doesn't
follow the 1974 Budget Act, and it is because it would require
Congress to make tough choices. And it is a whole lot easier to
simply waive the rules.
They tell me the last time Congress passed all 12 bills
into law before the expiration of the fiscal year was back in
the 1990s. And to me what that means is that no one in a
position of leadership today feels like they are opening
themselves up to any sort of criticism if they stray from the
budget rules.
Here we are 2 days after the Budget Act says Congress was
supposed to have passed a budget resolution, and there is no
uproar. There is no downside to having failed the act. It has,
in fact, become an expectation that Congress won't follow the
budget rules. And that seems like a problem.
But I think it also creates an opportunity. If we are able
to recommend some reforms and if congressional leaders from
both parties support these new budget rules, then hopefully it
will create some accountability and some pressure to follow
those rules next year when the new Congress is sworn in.
And that is not to say that a new budget process will lead
to significantly better fiscal outcomes right away. I don't
think this committee will be able to balance the budget or put
us on a quick path to eliminating our deficit and paying down
our debt overnight.
But I do think there are very real problems that we can
solve, and those are shutdowns, the threat of shutdowns, the
persistent use of long-term continuing resolutions to fund the
government.
And we are going to hear from one of our witnesses today
that those are wasteful and inefficient and destabilizing to
our economy and unfair to our federal workforce and unfair to
our military. And I think we have got to stop playing that
record.
I think there are a few principles that should guide the
work that we are doing as we work toward those goals. First,
whatever the budget process we put down on paper, in my view,
should reflect the reality of how Congress actually works.
I have only served in the post-BCA world where the budget
resolution is purely a messaging and political exercise that
is, frankly, largely a waste of time in a Congress that has
plenty of opportunities for messaging and political efforts.
The real budget process that I have seen involves Congress
coming together on a bipartisan basis and passing a 2-year
budget law and then working within that framework. And it seems
like we should decide which of these paths we want to follow
and have a process on paper that reflects that.
Second, we should empower the independent, nonpartisan
budget organizations. Someone needs to call balls and strikes.
And we should do everything we can to insulate the CBO from the
excessive partisanship that seems to have affected every other
part of our legislative system.
And, third, we should have a budget that is as honest and
as transparent as possible. Congress may need gimmicks to get
over the line, but it shouldn't rely on them to make the
process work.
So as we consider ideas for reform, I think there are a few
things that we ought to avoid. First, inducements or incentives
to actually be positive and not negative. We have already seen
what happens when Congress puts a gun to its head. It ends up
pulling the trigger. And I can't think of a single trigger that
we could design to force action that wouldn't end up being some
faction's preferred policy outcome.
On top of that, I think we should create incentives for
action, not inaction. Given the option, Congress always seems
to want to kick the can and avoid hard choices.
And the last thing we need to do is create a process that
incentivizes delaying difficult decisions.
And I want to close by saying that I approach serving on
this committee with genuine hope and excitement that we can
make a positive difference. I have had a chance to meet with
and talk to many of you who I am serving with on this, and I
hope to get to know all of you better as we undertake this work
together. I think it is really important.
And I thank you, Mr. Chairman. I yield back.
Co-Chair Womack. I thank you the gentleman;
Let's go to Oklahoma now, and the Senator from Oklahoma,
and my classmate, James Lankford.
Senator Lankford. Thank you, Mr. Chairman.
I had folks in Oklahoma that I visited with a couple of
weeks ago in a townhall meeting. I tried to describe this
process to them, and they said, ``What are your thoughts on the
success of this process?''
I said, ``I am in the early optimistic phase of this,''
that we are all together, we are all nodding our heads saying
something needs to be done. Ask me again in July how we are
doing, because at some point we will move from larger concepts
of recognizing problems to having to fight through how do we
actually get to a solution on this.
The problems are fairly obvious to us. In fact, it has been
obvious for decades. As one of our witnesses today will
mention, I am sure, today is April the 17th, 2 days past when
the budget is required to be done by Congress, yet the Congress
hasn't even taken up the budget much less actually passed it.
We have clear issues that we continue to face with the
deadlines and the structure as it exists. Eighteen of the past
20 years, we have had an omnibus bill. We are not even trying
to be able to go through the process.
What is interesting is to be able to see the history of
this. This is not something new. But the battle over leaving it
as is or saying that we need to actually have major changes is
something that we have not only seen, but it seems to be every
time the solutions seem to be the same, and we are reoccurring
those over and over again.
For instance, Senator Byrd, who was the Chairman of the
Senate Appropriations Committee in the 1990s, made the comment
that there is not a need to make a change in the budget process
because the Senate always gets its 13, at that time, 13 bills
done expeditiously, was his words, and so there is no need to
be able to change the budget process.
At the same time, the Budget Committee was making
bipartisan recommendations to be able to make major changes to
the budget process.
I would expect that would occur again. There will be
individuals that will stand up in this body and say, ``Things
are going fine, we are still open, we are still functioning,''
while this body stands up and says, ``No, there are major
changes that are needed, this is not working.'' We are going to
have to be able to work through that.
Most of these issues are not new to us. As I have gone back
through the history, as most of the members of this committee
have already done as well, and as we walk through as a body
together, we have seen some very basic things. Biennial
budgeting. Do we need to do this every 2 years? How does the
appropriations process work into that? Does the leadership
committee need to be able to take the lead on forming the
budget, or do we need to have a Budget Committee determine
that?
The big fight between authorizing and appropriating that
only makes sense in Washington, D.C., continues to come up
decade after decade after decade in the arguments, but yet we
have still not resolved that. How many bills should come to the
floor? How should those bills come to the floor? What is the
process for the Finance Committee? Do they engage with that in
Ways and Means?
The oversight committees and the lack of oversight from the
appropriations process. I can't tell you what it is in the
House right now, but I believe the Senate did exactly zero
oversight committees on anything in appropriations last year.
With over a trillion dollars in spending, you would think we
could work in at least one oversight hearing through that
process.
The CBO was designed to be a neutral balls-and-strikes
arbitrator. It has become a great way to be able to game the
system to be able to get done what you want to get done with
fun rules like ChIMPs and pension smoothing and whatever rules
that may be devised to create a new way to be able to spend
money, not to actually be able to get insight and information.
CRs, government shutdowns, debt ceilings, all of those things
all fall into the chaos of the system.
So my hope is that we can take the optimism that we
currently have and the recognition that something needs to be
done to look back at what has been discussed for decades and to
say, how do we break through individuals who will say,
``Everything is working fine because I still have power in the
process,'' and everyone else saying, ``No, this process is
broken''?
Just for the House Members that are here, let me describe
the Senate appropriations process that I have the joy to be
able serve on the Senate Appropriations Committee.
The bills come to the Subcommittee--out of the
Subcommittee--and you get the text of it the night before. You
can't get it digitally, because if you got it digitally, you
could search it.
You get the text if you go into a room, much like you are
going into a classified setting, to be able to flip through the
text of that, and then you vote on it with no amendments the
next day in the Subcommittee.
And then it comes to the full committee, and you fight off
all amendments during the full committee process. And then you
never see it again until it shows up in the omnibus bill.
By the way, may I mention, when it comes to the full
committee and you actually vote on it in the full committee,
each bill, you vote on it first, passing it up or down, and
then amend it second.
The process is broken from the subcommittee process, the
budgeting process, all the way through. And I would hope this
is something that we can address and should address.
With that, I yield back.
Co-Chair Womack. To the great State of Hawaii, Senator
Schatz.
Senator Schatz. I thank the Co-Chairs for their great work.
And I want to agree with almost everything that has been said.
I have a couple of additional thoughts.
I think we should do this on an ongoing basis. We may want
to consider doing this during every Congress as a good
housekeeping for rules and process issues.
It took us decades to get where we are. And although I am
optimistic, I am in the early optimistic phases of this process
as well, I am not optimistic that we can fix this in a matter
of months, and I think we have to be committed over the long
run to iterate this.
We are in the beginning stages of the NBA playoffs, and the
NBA has a Competition Committee that continually considers rule
changes and brings those recommendations to the NBA's Board of
Governors for their approval. And I think this is a good model
for us. The Joint Select Committee should be just the beginning
of a regular effort to develop reforms in our processes.
In terms of specific proposals, under normal circumstances
I wouldn't repeat what was said before, but I want to reiterate
my determination to deal with this debt ceiling problem. I see
no benefit.
I understand what Representative Woodall is talking about
in terms of giving the minority rights, but I think that is a
broader question about the functioning of the House and Senate.
And although there are sometimes some salutary effects, for
both parties and both ideological perspectives, I think it is
basically a trap for ourselves.
A couple of final thoughts. We are talking a lot about
budget and appropriations and not a lot about finance and Ways
and Means. We are very possibly the only legislative body left
on the planet that divides budget, appropriations, and revenue
in the way that we do. I don't think it is the main problem,
but it is a quite convoluted way to do our business.
And the final point I will make is that success in this
process depends on goodwill. The House has their Rules
Committee in which they establish a rule for a bill, which
usually deviates from the normal rules. And in the Senate, just
to be clear, the only way the Senate functions and the only way
the Senate has ever functioned is if you deviate from what they
call the regular order.
We need unanimous consent on a daily and sometimes hourly
basis to allow the Senate to function, and the only way you get
UCs is if you have goodwill. So I want to be cautious about our
instinct to establish new rules when, in fact, what we need in
the Senate in order for things to function is the waiving of
the rules on a regular basis.
But the reason that I am hopeful is that this process is
the beginning of establishing trust and goodwill, and that is
at least what will help on the Senate side.
So I yield back.
Chairman Womack. I thank the gentleman.
To Missouri, the distinguished Senator from Missouri, Roy
Blunt.
Senator Blunt. Well, thank you, Chairman.
And as my friend Mr. Yarmuth pointed out, everybody has
said almost everything now, and with great commonality,
actually, which is the interesting thing here. The tremendous
sense of common purpose and an understanding that what we are
doing now is just not working. We are down, essentially, to one
bill that not only, as Mrs. Lowey pointed out, is the
appropriations bill, but now is more and more the one big
legislating bill.
And this really has to stop. We are in a situation now
where, basically, four members of the Congress, the leaders of
the House and the leaders of the Senate, maybe five, maybe
possibly six, and a dozen staffers make way too many decisions
in way too closed an environment with not nearly enough
information. And all these bills always reflect how far afield
some of those decisions have wound up in that environment.
At least the appropriators in the House and Senate get a
chance to have input on the initial bill, and many questions
are decided before they get to those four leaders. But bringing
this down to one vote, you have one vote on one bill to decide
whether you are going to do all the things in that bill and try
to weigh that balance.
The system was never designed that way. Early on, there was
one vote on one bill, but it was a little bill that spent, what
did we learn the other day, maybe $5 million was the funding of
the government. And that is not the case.
The President then has also one decision. He gets a chance
to sign that one big bill and keep the government operating or
to veto that one bill.
This is a foolish position we have gotten ourselves in, and
I think everybody understands that. Last week we had 229 years
of congressional history in 36 minutes. But it was a pretty
good reminder of just how this system worked so well for so
long and has stopped working in recent years.
Today we have two really extraordinary witnesses who
understand this process as well as anybody, Mr. Chairman. And
thanks to you and thanks to Congresswoman Lowey for leading
this effort.
Co-Chair Womack. And finally, to the great State of Texas
and the Chairman of the House Rules Committee, Mr. Sessions.
Representative Sessions. Mr. Chairman, thank you very much.
Much has been said here today that I completely agree with. I
am just going to add my few comments. I am not sure it has all
been said yet, but a lot has been said.
First of all, let me say this: I think we need to use the
word ``common sense.'' I think we need to use the word
``goals.'' And I think we need to use the word
``recommendations.''
I think that there is a cadre of things that we see. We
should call them out. We talk about balls and strikes. There
are about probably 200 pitches along the way that take place in
not only the budgeting process, but the appropriations process,
and I think we should delineate those.
I think we should have a good idea upfront about, what are
our goals? What are our recommendations? What do we look at as
common sense? Perhaps we can or cannot come to an idea.
The gentleman, Rob Woodall, spoke clearly about, not
disagreeing with Mrs. Lowey or others, but about raising the
debt ceiling. I think that that should be a huge stop sign. I
don't think it should be something that we should blow through
and take as pro forma. I think we should expect that that is an
important element for us to look at.
Once again, I will agree with Mrs. Lowey, but we have to do
it. We cannot allow us to default. But we need to look at it,
at what is the goal and what is the recommendation that we
would receive out of it.
I think we should also include, and I intend to be a part
of this, making sure that we put some delineation in about cost
of noncompliance. A few people have talked about the real cost
that happens to the United States Navy since 2011, us not
accurately giving the government, in particular Health and
Human Services, and in particular the United States military,
their money day one.
I think it should come as a goal, I think it should come as
a recommendation that the largest elements of the United States
Government must be funded first. It must be a goal. It must be
a recommendation.
And we should look at those items on a bipartisan basis, on
a bicameral basis, and with, certainly, the President of the
United States and Article II of a delineation that we believe
would be common sense. And that is, giving someone that has
$600 billion worth of responsibility, that you must allow them
that opportunity to effectively make plans, do the things that
are in the best interest of the country.
You can vote for it or against it, but we ought to decide
that we are going to do it day one.
The other areas, look, I would like to say, sure, we need
to fund all the other areas, and we should not drag that on.
But the largest items, I think, common sense should prevail.
Secondly, I think we should have an idea, and it has been
spoken about by our Republican and Democrat colleagues, that I
am very pleased to hear, but I think we should call it a
pathway to balance. What are we aiming at? We have used the
terms, ``can't get there overnight,'' I agree with that. But I
think we ought to have an idea about a goal and a
recommendation that we follow about how we are going to proceed
and not add to it.
Lastly, I am going to see if I can push to getting my arms
around a look at nonfunded or unfunded liabilities in the
future. I think we have got to be driven by facts that we all
agree with. Instead of saying, ``Well, we didn't get our work
done, maybe the American people did not expect us to do that,''
I think that there has to be some opportunity for us to
understand why we are doing what we are doing and that we make
tough decisions.
I was elected to make tough decisions. We all were. I hope
we can use this time to effectively look at goals,
recommendations, and common sense.
Thank you, Mr. Chairman.
Co-Chair Womack. I thank the gentleman.
In the first hour of this first public hearing, you have
heard from 14 of the 16 members of this Joint Select Committee,
a very thoughtful opening discussion of the challenges that we
face and the opportunities that lie in front of us.
I would like now to, again, welcome our witnesses, Dr.
Holtz-Eakin and Martha Coven. Thank you for your time today.
The committee has received your written statements. They will
be made part of the formal hearing record. You will each have 5
minutes to deliver your oral remarks.
At this time, I would like to briefly yield to the
distinguished Co-Chair, Mrs. Lowey, to welcome our first
witness.
Co-Chair Lowey. Well, thank you.
And it is such an honor for me to introduce Martha Coven,
who brings 25 years of experience working on domestic policy
and the federal budget, inside and outside of government.
She is currently a visiting professor, lecturer at
Princeton University's Woodrow Wilson's School of Public
Affairs. Ms. Coven started her career as a staff member in the
House of Representatives, spent several years at the nonprofit
Center on Budget and Policy Priorities. She has a BA in
economics, a JD from Yale.
And we look forward to hearing your testimony. Thank you
for being here today.
STATEMENTS OF MARTHA COVEN, J.D., LECTURER AND JOHN L.
WEINBERG/GOLDMAN SACHS & CO. VISITING PROFESSOR, WOODROW WILSON
SCHOOL OF PUBLIC AND INTERNATIONAL AFFAIRS, PRINCETON
UNIVERSITY; AND DOUGLAS HOLTZ-EAKIN, PH.D., PRESIDENT, AMERICAN
ACTION FORUM
STATEMENT OF MARTHA COVEN
Ms. Coven. Co-Chairs Lowey and Womack and Members of this
Joint Select Committee, thank you for inviting me to testify
today.
When I arrived at OMB, I had no idea I would soon acquire
such skills as how to implement a midyear sequestration,
including how to furlough staff; how to prepare to hit the debt
ceiling; how to structure exception apportionments under
protected continuing resolutions; and how to manage the
government during shutdowns.
So much wasted energy has gone into tasks like that over
the last several years. So I commend the Congress for forming
this committee.
As a further sign that it is time to rethink things, I
found myself earlier this year cutting dozens of pages from my
syllabus. Teaching students how Congress assembles and enforces
a budget resolution felt quaint, to put it mildly.
So my hope is that I have only temporarily lightened my
students' load and that by this time next year they will be
reading about the well-considered reforms you have produced.
Let me begin by offering a few reflections on the existing
process.
However imperfect a tool the Congressional Budget Act has
become, it has left an important legacy. It has created the
Congressional Budget Office, a neutral voice telling it
straight to members of both parties. And more broadly, as the
saying goes, plan beats no plan.
And the Budget Act has had a pretty good run. Its framework
and complementary measures, like the PAYGO rule, helped guide
Presidents and Congresses of both parties to a situation where
we fleetingly had budget surpluses. So I would caution you
against tearing up the existing rules until you are certain you
have a better approach.
I will turn now to some specific recommendations for
improving the process. So I will start with a caveat.
A wise colleague once observed to me that budget rules are
much better at enforcing agreements than at forcing them. What
we most need, as many of you have said, is for Congress and the
President to set responsible fiscal goals and make tough
choices.
With that said, there are three specific measures I would
urge you to consider.
My first recommendation is to restructure the
appropriations calendar to match the congressional calendar. It
has become laughable to imagine that appropriations bills could
be done by September 30.
Chronic delays in the appropriations process make
implementation difficult and get in the way of a shared
bipartisan goal of making the most efficient use of whatever
funds are appropriated. Your jobs may be done when you finally
pass the bills, but for everyone else, the work is just
beginning.
Delays are frustrating, not only to federal agencies, but
also to the many other individuals and institutions across the
country whom we ask to carry out activities with those funds,
including state and local governments, nonprofits, and private
contractors.
It is hard to make smart decisions or do good planning if
you have to scramble midyear just to get the money out the
door.
Nothing can fully prevent delays, but two steps would help
restore regular order.
First, shift the federal fiscal year to the calendar year.
Both Congress and the President take office in January, so it
makes sense to treat that as the start of the budget year as
well. You would have the full year to get your work done, and
legislation does tend to get wrapped up in December as jingle
bells start to chime.
Secondly, at the beginning of each Congress, both Chambers
and the President should negotiate aggregate discretionary
levels for the next 2 years. You have done this three times
already through bipartisan budget acts, but not at predictable
times or in standardized ways.
My second recommendation is to end the debt ceiling
brinksmanship. Indulging in buyer's remorse at the point when
Treasury has to pay the bills risks damaging our economy and
harming vulnerable citizens.
And my third recommendation is to reserve reconciliation
for fiscally responsible legislation. Reconciliation should be
used for the politically difficult work of deficit reduction,
not the politically convenient work of cutting taxes or
increasing spending.
Let me close by echoing the comments many of you made in
encouraging you to approach your tasks in a politically neutral
manner. Efforts to stack the deck in a progressive or
conservative direction will hamper your ability to carry out
your mission.
Future Congresses need to retain the flexibility to make
decisions about the appropriate levels of revenue and spending
to meet the changing economic needs of their time and stay true
to the people they represent. You can provide a framework for
those decisions, but you can't make decisions for them.
To that end, I encourage you to set aside proposals that
would establish rigid targets or enforcement mechanisms that
aim to steer mandatory spending or revenues in a particular
direction or to lock our nation onto a particular fiscal path
without knowing what the future holds.
Thank you, and I look forward to your questions.
[The prepared statement of Martha Coven follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you, Ms. Coven.
Our next witness is Doug Holtz-Eakin, who has served in a
variety of very important policy positions since 2001. During
2001 and 2002, chief economist for the President's Council of
Economic Advisers, where he also served as the senior staff
economist. But most notably, from 2003 to 2005 as the sixth
Director of the nonpartisan Congressional Budget Office.
He brings a wealth of experience in the subject matter
before this Select Committee, and we are delighted that he has
joined us here this morning on this panel.
Dr. Holtz-Eakin, the time is yours.
STATEMENT OF DOUGLAS HOLTZ-EAKIN
Mr. Holtz-Eakin. Chairman Lowey, Chairman Womack, Members
of the Committee, thank you for the privilege of being here
today. And let me open by simply thanking you for your
willingness to serve on this very important committee.
I am a long-time observer of this very broken process, and
everything I have heard today leaves me in the early optimistic
stage as well. I hope I see you again later in a comparably
optimistic stage and that your service turns out not to be
thankless.
There are enormous budget problems. They take the form of
both debt trajectory as a threat to this nation and a process
that regularly threatens shutdowns of the government,
brinksmanship over the debt ceiling, and I think it is
important that everyone here recognizes that. I think that it
is an important early sign.
We know that those problems will not be solved by process
reforms alone, that, in fact, there will have to be some very
important policy changes as well.
But in thinking about the process reforms, there really are
two branches, and we have heard both of them today. I would
urge you to pick early between radical reforms, clean pages,
starting over from scratch, versus modifications of the Budget
Act.
I am willing to entertain the former, but I think my
experience leads me to suggest that on the timetables you have,
the latter might be the way to go.
I would concur with some previous sentiment that those
process reforms should be policy-neutral. This should not be a
committee that stacks the deck for a particular set of
outcomes, however much I might want one or the other.
And in my written testimony I have some suggestions, for
example, in reformulating the baseline so that it is truly
neutral between tax and spending decisions as you come to terms
with the large debt problem.
And I guess I would echo what has now been said several
times about the importance of building on success. There are
things that the Congress and the President have gotten done in
recent years, and they have been 2-year agreements on how to
fund the appropriations and what the levels of spending will
be.
Those are, perhaps, a sign that the budget resolution
should be a 2-year resolution, that we should have something
closer to a biennial budget. It is also true that the President
has signed those agreements in every case.
Perhaps that is indication that it is time to move from a
concurrent resolution to a joint resolution where there is
agreement on budgetary totals, appropriations, mandatories,
taxes, and the borrowing between the House, the Senate, and the
White House, something that doesn't happen right now.
I regularly tell people, the U.S. Government does not have
a budget. It doesn't have a fiscal policy. It doesn't have any
single document that everyone agrees on for how it will add up.
Instead, we have budgetary outcomes, usually bad. And it is
time to change that record. And so I think building on that
success, I think, would be an important thing.
There is a lot of talk about different ways to manage
internally the enforcement, carrots and sticks on getting
things done. And there have been attempts at No Budget, No Pay,
No Budget, No Recess, a variety of sticks.
I was encouraged to think about carrots in the process of
preparing my testimony. I try not to think about vegetables
very often, but I did. It is hard.
But it seems to me that there are some techniques that
would be modeled on, essentially, the Gephardt Rule, which used
to provide for deeming the debt limit as being passed when you
pass the budget resolution, that would allow Congress to
address some votes that are politically toxic, but which are
real, like giving yourself a pay raise, which should happen and
which is an impossible vote for anyone to take, and that if you
pass a budget resolution, there would be a process to expedite
those kinds of votes.
And I would encourage you to think about those things,
because we do need to both fix the budget process, but we also
need to fund the government and fund the people who make this
government run in a timely and efficient fashion.
And so I thank you for the chance to be here today. I would
say that I would be happy to aid this process in any way, not
just at this hearing, but in the months to come.
[The prepared statement of Douglas Holtz-Eakin follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you, Dr. Holtz-Eakin, and Ms. Coven
as well, for your prepared testimony here today. We are going
to move into the Q&A period.
Dr. Holtz-Eakin, you have a thoughtful analysis in your
prepared remarks of the pros and cons of making the budget
resolution a joint resolution and sending it to the President
early in the year.
On one hand, it certainly establishes executive branch buy-
in early in the process, but on the other hand, could be giving
the White House a little more power than they currently have
and turn even more authority over to them, even make the
congressional budget process worse if, in fact, there is no
agreement.
So expand on your prepared testimony on these thoughts.
Talk about the tradeoffs, if you will.
Mr. Holtz-Eakin. I think you expanded on it perfectly.
I offer it with mixed emotions, quite frankly. Funding the
government is a congressional obligation under the
Constitution. The power of the purse belongs in the Congress.
The Congress is responsive to the voters, and I think there
should be a deep commitment to that.
But the way we are doing things right now, as I said,
doesn't constitute genuine budgeting. There is no place where
we require that it all add up and that people sign off on that
plan on behalf of the voters.
So the argument for going to a joint resolution is to have
some vehicle for that buy-in by all parts of the government so
that we actually get coherent fiscal policy and don't find
ourselves in the position we are today.
It could make things worse. It certainly changes the
balance of power. You now have a President who has to sign off,
and it is one more person who can play brinksmanship, one more
person who can hold up the process. And it might, in the end,
turn out to produce outcomes that are even worse than right
now. I don't know for sure.
So I can't give an enthusiastic no reservations
endorsement, but I do think we need to be cognizant of the fact
that we aren't really doing budgeting. We are doing a subset of
it, and not very well.
Co-Chair Womack. Ms. Coven, you mentioned in your testimony
that delays in getting the final appropriation numbers for an
agency in any given year produces a significant impact on the
agency's operation. Can't plan, and when they do a lot of
contingency planning, a lot of what-ifs, there is a lot of
inefficiency in that type of process. As an appropriator, I
certainly agree with your testimony.
Automatic CRs have been suggested as one way to reduce the
potential of this brinksmanship. What impacts would an
automatic CR have on the appropriations process and agency
operations, in your opinion?
Ms. Coven. Well, with all due respect, Mr. Chairman, I
think if you passed automatic CR legislation, you may as well
disband the appropriations committees. It removes the incentive
for there to be that process of carefully looking at the
funding levels for each program.
I think, further, it creates a risk that we will not have
adequate funding. Our funding will go to the wrong places,
speaking of inefficiencies, if the government just continues.
Circumstances change on the defense side of the equation, on
the nondefense side of the equation.
We have private market forces that affect where those needs
are in veterans' medical care, in housing assistance.
So the idea that the default plan is to just continue where
the funding had been previously, I think is recipe for greater
inefficiency rather than for a better process.
Co-Chair Womack. My last question for you is that many
state and local governments have procedures in place to ensure
that government still functions even if a new budget is not
passed. I particularly like what Arkansas does. You know, it
has a Revenue Stabilization Act, a form of a balanced budget
agreement that forces the legislature to have to look at
different components of government from time to time.
Are these forms of government guardrails, as it were,
appropriate? And if so, is there a model out there that we
should look to?
Ms. Coven. Well, I don't know the precise model that you
are pointing to in Arkansas. I will caution you, I think it is
wonderful to set out to provide yourselves with information
about where we are heading so that you can judge whether the
sum total of the actions that you have taken are pushing you in
the right direction.
I think if you move to something that is more rigid, like a
cap, like a balanced budget requirement, anything like that,
you are setting up a situation where you are ignoring the
underlying factors, which we know are an aging population and
healthcare and revenues and the matters that you have
considered, and you are sort of dodging the idea of making
thoughtful policy choices, and instead, potentially letting
some sort of automatic mechanism, like sequestration, be the
solution. I don't think that was very popular here and I don't
think it was very popular around the country.
So I think it is wonderful to provide yourself with
information, and that is one role that budget committees can
play, but I would really caution against putting yourselves on
some kind of autopilot.
Co-Chair Womack. My distinguished Co-Chair, Mrs. Lowey.
Co-Chair Lowey. Thank you.
And thank you both for your testimony.
It is interesting to me that while our two witnesses have
different perspectives, you both make the point that budget
process reforms should be policy-neutral. And we would hope
that reforms should help facilitate good decision-making by
Congress. But we should avoid things that try to force
particular policy outcomes, such as fixed targets enforced by
automatic spending cuts.
I would appreciate if either of you would elaborate on that
point.
Mr. Holtz-Eakin. I think there are a couple of reasons why
this committee is not the right place to do that policymaking.
First of all, you are tasked with the budget and appropriations
process, not the fiscal policy of the United States. And so it
seems like a bit of an overreach.
The second, though, is if there isn't genuine buy-in, not
just by your colleagues in the House and Senate, but by the
public, inevitably whatever targets, triggers, mechanisms you
put in place will be overridden.
We have seen this again and again and again, whether it was
the SGR mechanism in the docs pay in Medicare. I am old enough
to remember Gramm-Rudman-Hollings and fixed deficit targets,
which we overrode because we couldn't hit them. People hadn't
bought into matching them.
As Martha said, you can use these kinds of things to
enforce an agreement, but you can't force a policy outcome. And
I would urge you to not try.
Ms. Coven. I agree with that. The only thing I would add is
that you really--and this is really as to what Doug said--you
want your reforms to be durable. And as you all know, control
of Congress and the Presidency shifts from time to time, and
you don't want the first order of business of each new Congress
to be to rejigger the rules that the previous one set.
So I think establishing policy-neutrals will help make sure
that these are lasting reforms.
Co-Chair Lowey. I think I will save my other questions and
give opportunities to others. Thank you, Mr. Chairman.
Co-Chair Womack. Thank you.
Senator Perdue.
Senator Perdue. Thank you.
And I am so excited by your testimony. I have been through
every word of it.
Mrs. Coven, there must be something wrong today. You are
the Democratic witness today, and I agree with every word you
have written here.
In all seriousness, you make four recommendations: shift
the fiscal year, look at biennial budgeting, get rid of debt
ceilings, and use reconciliation, if you are going to use it at
all, use it for what it was written for, and that is to reduce
the deficit.
But the thing I like the most, and we have all said this in
different ways, not just the process here of the Select
Committee should be politically neutral, but I believe the
budgeting and funding process itself, the process, should be a
politically neutral platform. And you say: I encourage you to
approach this task in a politically neutral manner.
Dr. Holtz-Eakin, you say the same thing.
Here is my question for both of you. There are a lot of
things we can do to change the process, but there are two
issues. One is policy and one is outcome.
The policy we are talking about. Let's separate the process
from the policy in this Select Committee, is my opinion, and
look for a politically neutral platform.
Senator Hirono said it best, I think, in our first meeting,
that her only wish here is that we have a process in which we
will never have to use a CR again. I think that is a high
calling, and I love it, because I think it is very simple and
it ought to be our outcome. The thing that we are trying to do
here is fund the government.
Would you both help me? You both talked about consequences.
You both talked about incentives. But if we have a process and
we get to the end of the fiscal year, and let's say it is 12:31
along with the calendar year--Ms. Coven, would you start, and,
Dr. Holtz-Eakin, I would love to get your opinion--what can we
do to hold ourselves accountable and get that done so that we
don't have to deal with, ``What if we don't do it?'' That is
where sequestration was born. That is where the Budget Control
Act was born.
We need a process that functions without all the drama. And
by the way, every other country in the world, every company I
know of and every state I know of does this without the drama
of the U.S. federal government.
Would you guys just address how we get there at the end of
this process?
Ms. Coven. So I will start, I guess. Thank you. And I
thought a bit about this, obviously, after being invited to
testify.
I think the best you can do is look for the natural
breakpoints for the U.S. Congress. And December, usually the
end of the year is the most natural breakpoint in the action
for you. Sometimes it is the end point, because you know a new
Congress is taking over.
Senator Perdue. Yeah, I agree with that. And it gives us
more time during the year, too.
Ms. Coven. Right.
Senator Perdue. So my question is, if you don't get that
done by that date, what happens? And what are the things you
would suggest to us to hold us accountable to where we would do
it?
Ms. Coven. So, I mean, Doug put some of those ideas on the
table. You all are adults. You take your responsibility
seriously. To me, having something that actually withholds your
pay or something else from you, I don't know if that is a road
that you want to walk down.
My hope is that by rejiggering the calendar so that there
is an expectation--and a lot of budget process operates through
norms and expectations--that that is enough to get things on
course. But if you want to talk about stronger measures, I
don't know----
Senator Perdue. Well, I am sorry, I am not looking for
stronger measures. But the reality is, if you start January 1,
which we do today, you get a document from the White House.
When we start, we have 14 weeks for budgeting. In the Senate,
you have 16 authorizing committees.
And by the way, we haven't authorized in years. The State
Department for a while wasn't authorized for 15 years, until 2
years ago. It is a joke. We are the only real entity that still
uses an authorizing process.
But that is 16 weeks. Another 12 weeks for the
appropriations. That is if you do one a week in the Senate,
which has really never been done, obviously. Well, that is 42
weeks out of a 52-week calendar. Even if you change the fiscal
year, it is not going to happen. So I understand there have to
be some structural changes.
But, Dr. Holtz-Eakin, help us with it, very quickly, as I
want to yield time to the other guys here as well.
Mr. Holtz-Eakin. I don't have a magic solution on that. I
really don't. I mean, if you walk through the mechanics that
you just outlined, the first thing that jumps out is maybe
there are too many appropriations bills. Maybe 12 is the wrong
number.
Senator Perdue. Is that what you meant by potentially
incrementalizing our way there? Then let's say you do that, you
go to biennial, you reduce the number of appropriation bills,
you give yourself a better chance. Then the question, major
question is, do we still need an authorizing process?
I don't have time. I will submit that question to both of
you. I would love to get your response on that.
Mr. Holtz-Eakin. Sure.
Senator Perdue. Most every other entity we looked at in the
last 3 years has a budgeting process that has efficacy, it has
an appropriating process that works. Very few, if any, had an
authorizing built in there. Authorizing was part of the
budgeting allocation process.
Are you familiar with that?
Mr. Holtz-Eakin. Yeah. Why don't I get back to you in
writing?
Senator Perdue. Okay. All right.
Thank you, Mr. Chair.
Co-Chair Womack. Senator Whitehouse.
Senator Whitehouse. Thank you both for your testimony, not
only here but in many other Budget Committee hearings.
Is it fair to say that you can't even calculate the deficit
in any given year without looking at revenues, appropriated
spending, healthcare spending, and tax spending? It is just a
mathematical truth, correct?
Ms. Coven. Yes.
Mr. Holtz-Eakin. Yes.
Senator Whitehouse. Both witnesses agree that is a
mathematical truth. Good.
And how broadly accepted is debt-to-GDP ratio as the
metric, whatever the number actually is, but as the metric that
we should be looking at with respect to a sustainable national
debt?
Mr. Holtz-Eakin. I think that is pretty widely accepted.
The footnote on that would be what measure of debt do you want
to put, debt of the hands of the public or the total debt.
Senator Whitehouse. Correct.
Mr. Holtz-Eakin. So I would be a fan of debt in the hands
of the public as the economically relevant measure.
Senator Whitehouse. Ms. Coven.
Ms. Coven. I would agree. But you made an important
distinction, which is what the number actually is, and that can
vary with the business cycle. So it is not that there even is
one number, but as a general measure----
Senator Whitehouse. The conversation should be about debt-
to-GDP with those asterisks.
Ms. Coven. It is a very useful conversation to have.
Senator Whitehouse. Okay. That is good to know.
And are we going to be able to fix this in a year or do you
need to plan for a glide slope that gets you from where we are
to where we need to be?
Mr. Holtz-Eakin. It will certainly take many years.
And in terms of where you need to be, I think the
economically relevant thing is that the U.S. display to global
capital markets that debt-to-GDP is on a downward trajectory,
even if a tiny slope. But right now it is going straight up.
Senator Whitehouse. Let me jump in on that because that is
a point that I would like to ask you guys about.
Let's say that all that this committee was to secure the
passage through Congress of a plan that set a sustainable debt-
to-GDP ratio and set a mechanism for a glide slope to get there
and some alarms to let you know if you got off course. How do
you believe global markets would react to that achievement now?
Mr. Holtz-Eakin. I don't think they would react at all
because I think global markets would view that the way I view
it, which is a fairly empty promise since you haven't got
political buy-in on the policies that would make it happen.
Senator Whitehouse. So you would actually have to start
doing it.
Mr. Holtz-Eakin. Yeah.
Senator Whitehouse. Okay. And then how would they react?
Mr. Holtz-Eakin. That would be a very good day.
Senator Whitehouse. Okay.
You have talked about the reconciliation process. In my
view, in the Senate it has been hijacked to completely
unrelated purposes from dealing with the debt or the deficit.
It is a bipartisan sin. We used reconciliation to help pass
ObamaCare. The Republicans just used reconciliation to pass
massive deficit-creating tax cuts.
And make this a response for the record if it is going to
take a long time, but I would be interested in what constraints
or restrictions you think we might be able to agree on that
would actually be effective in limiting reconciliation to its
intended purpose now that it has kind of gotten out of control.
How do we get it back in the cage?
Ms. Coven. Yeah, I want to make one very important
distinction, though, which is that, whatever your feelings on
this panel may be about ObamaCare, that was not legislation
that was scored as adding to the deficit. I think we have seen
that more in the tax arena. But it is certainly possible in the
entitlement arena.
Senator Whitehouse. And as somebody who supported it very
energetically, I like it, too. I get all that. But I don't
think it was our view that we were doing that as part of a debt
and deficit measure.
Ms. Coven. That was not the primary purpose, right.
Senator Whitehouse. That was designed as a healthcare
measure and to help people across the country. And we used this
process because it worked, not because we were trying to solve
primarily a debt or deficit problem.
Ms. Coven. Right. Right. But I think the point, the
important thing is that it is more important that
reconciliation not be abused and increase the deficit than to
set some particular target for how much deficit reduction has
to be achieved in order to have that tool.
Senator Whitehouse. Exactly.
Ms. Coven. The risk is in the negative direction. So what I
do is implement something like what used to be the Conrad Rule
in both Chambers, which is to say that you can't use it to
increase the deficit.
Senator Whitehouse. Okay. And if you have any further or
more complicated thoughts than that that you want to put in
writing for me, I would be interested. Because we do need to
solve, I think, the abuse of the reconciliation process in all
of this.
Mr. Holtz-Eakin. So, briefly, the thing I would just
mention for everyone is that reconciliation is really a way to
get around the rules of the Senate.
Senator Whitehouse. Yeah. Exactly.
Mr. Holtz-Eakin. In the end.
Senator Whitehouse. And the Senate Budget Committee has
become a delivery system for that rule breaking.
Mr. Holtz-Eakin. And so, since this is a general entity, I
would hesitate to dictate to one Chamber how they are going to
run themselves.
Senator Whitehouse. I am just asking for recommendations.
You are not going to be dictating.
Last thing is the debt ceiling. Upside? Downside?
Specifically, what does it look like if one day we should fail
at passing a needed debt ceiling and went into default?
Mr. Holtz-Eakin. U.S. Treasury's are the foundation of the
global financial system. Impairing their liquidity even a
little bit would be an economic catastrophe. It can't happen.
Ms. Coven. And similarly, the programmatic consequences of
having to tell the American people, our contractors, everyone
else we do business with that we are not sure when we can pay
you is--and we had to deal with planning for this a few years
ago when we actually got up to it--it is no way to run a
railroad.
Senator Whitehouse. Thank you both.
Thank you to the chairman.
Co-Chair Womack. Mr. Arrington of Texas.
Representative Arrington. Thank you, Mr. Chairman.
And I want to thank the panelists for your thoughtful
testimony and responses to our questions.
As a new Member, I have been surprised by a lot of things,
but not the least of which has been the lack of accountability
and oversight, which is the governing part of the job I thought
was going to take most of my time.
I think in my, again, year of service, whether it was on
the VA Committee or some other, Agriculture, Authorizing
Committee where we have oversight responsibilities, I think the
lack of oversight has created a culture that lacks
accountability and a focus on results. And so the federal
government is not operating effectively in service to its
citizens.
I can't tell you how many times I have asked the question:
So tell me, before we fund or reauthorize your program or make
recommendations for such, how is it going? Are you achieving
the desired outcomes? Are you off-the-chain great or are you
way underperforming? And maybe we need to invest more money in
this because it is working so well to serve the veterans or the
farmers or what have you.
So I believe that we could have a policy-neutral
recommendation to have oversight before we actually throw money
at something that may not be achieving its desired outcome,
whether it is a Republican idea or program or it is a Democrat
idea or program.
Can you both comment on how in the world we get back to
that component of regular order, good business, and as my
friend and fellow Texan says, common sense?
Ms. Coven. So I absolutely agree with what you are saying.
I think we don't take a hard enough look at, particularly, some
of the programs that we set in motion and ask ourselves: Do we
know it is working? Is it achieving the result that we are
asking?
The question was raised earlier, I think by Senator Perdue,
about what the role for the authorizing committees are. And I
think one useful reform coming out of this process could be to
step up the expectation that they are the partners with the
Appropriations Committee in asking those hard questions.
Now, in fairness to the appropriators, those questions do
get asked of federal agency witnesses and others who come
before them every year to defend their budget request and
explain why the administration thinks funding should be
increased in one place and cut in another.
But the authorizing committees have a lot of scope to do
this, to delve more deeply to answer the questions you have
asked. And I think their thoughts should have more input into
the decisions that are made by appropriators.
Representative Arrington. Thank you.
Mr. Holtz-Eakin. I am going to echo that, and I will do it
via a very particular example, which is Chairman Womack
recently had me testify in front of an oversight hearing for
the Congressional Budget Office. It was the first time I had
delivered such testimony, even though I ran it. There were no
oversight hearings.
The closest that I came to an oversight hearing was the
legislative branch appropriations bill when I had to defend
CBO's budget request and to explain what it did and how we were
going to use that money. I think that's a real problem.
And I would echo that a good use of the authorizing
committees is to have them be your partners with a much more
explicit role for this. And if you have a different calendar,
they can go first and then you can appropriate based on the
results.
Representative Arrington. Senator Whitehouse has gone. Is
he here? No, he has left.
Well, I want to say that I align my thinking about how we
ultimately get at responsible and effective outcomes. I
recognize that we may not get there and we may just have a
better process, a smoother and more seamless process. I am for
that, by the way. So I like the glide slope. I like the
targets.
I don't know what mechanisms or accountability or pain or
shame or carrot or stick that is going to move this seemingly
immovable body. So it is discouraging after we got the history
of almost 200 years of reforms and then we look and it is $21
trillion in debt.
I do think the fixed target and glide slope idea, I think
it is a great idea. I just don't know how in the world we are
going to change the behavior of the United States Congress.
Isn't that the million-dollar question here on anything,
whether it is timeliness, whether it is unauthorized to now
authorized spending? Whatever it is, isn't the million-dollar
question how do we change the behavior of this animal that
doesn't seem to want to change?
Give us some ideas on that in that regard.
Mr. Holtz-Eakin. So this has come up a number of times
around the globe. And the essential issue is that there is
nothing that you can do in the way of a mechanism that you
can't also undo. And so you can't bind yourself to delivering
any particular outcome or process or whatever.
So in other places, Scandinavia, there are a couple
countries who did this, you adopt fixed fiscal rules that
bind--the parliament in that case--that they have to adhere to.
In our case, that would require amending the Constitution.
That is the thing which you cannot change to which you must
adhere, and that is a very high bar for changes.
Representative Arrington. I yield back.
Co-Chair Womack. The gentleman from the Commonwealth of
Kentucky, Mr. Yarmuth.
Representative Yarmuth. Thank you, Mr. Chairman.
Thank you both for your testimony. And I am glad to hear
you both reject the notion of No Budget, No Pay or No Budget,
No Recess. It seems to me that is a recipe for doing shoddy,
sloppy work. There is an incentive to do anything to avoid
those repercussions rather than to do responsible work.
Ms. Coven, I have a question for you. Dr. Holtz-Eakin
suggested that we consider a joint budget resolution to get the
President more involved in the process earlier. He also
suggested that change would have pluses and minuses. What is
your view of that potential change and how would you weigh the
advantages and disadvantages for that change?
Ms. Coven. So I am not a fan of that proposal. And Doug
helped to explain some of the pitfalls. Let me just amplify
briefly.
So, first of all, if you think what we need is more
gridlock, that, to me, is the recipe for it. It is hard enough
to get an ordinary budget resolution done. As you all have
said, they often don't get done. Inviting another party into
that negotiation could make it more difficult.
Secondly, it is a power shift in two directions, not only
shifting some of your Article I power down the other end of
Pennsylvania Avenue, but also, if we are talking about this
resolution being a 51-voter, shifting power away from the
minority party in the Senate.
And as the saying goes, sometimes you are the windshield,
sometimes you are the bug. You don't know which party you are
in that situation. So the idea that you would permanently say,
``Well, the minority just doesn't have a voice,'' doesn't make
sense to me on something as important as this.
And the third thing is that it risks, if it is a bill,
which it would be if it were signed into law by the President,
becoming a Christmas tree, a mega budget bill, a mega revenue
bill that tangles everything up in one big knot.
So while I understand and appreciate the notion that you
want the Congress and the President to be on the same page, and
I have suggested it with regard to caps and appropriations
because that is just practical, otherwise the government shuts
down, the idea of trying to do the whole ball of wax in one
fell swoop seems to me too ambitious and likely to deteriorate
the process rather than improve it.
Representative Yarmuth. I appreciate that.
This morning I woke up to see that Senator Enzi has floated
the idea of possibly doing away with the Budget Committee. I
don't know if he was talking about in just the Senate. So I am
interested in getting your thoughts on that.
And also something that occurred to me once, an idea, I
have no idea whether it makes any sense or not to even think
about it, but the possibility of a Joint Committee to
essentially save a step, where the Senate and House developed a
budget resolution together. Any thoughts on either of those?
Mr. Holtz-Eakin. I am not familiar with what possessed Mr.
Enzi to suggest getting rid of this committee, so I won't
answer that one.
In the template that was the Budget Act, the Budget
Committee as a coordinating function and as a consolidator and
as handling the reconciliation process made perfect sense. Like
much of this, it just hasn't worked out so well, so that
suggests that some change does make sense.
I see no reason why a Joint Committee wouldn't be a good
first step. If nothing else, the act of looking at the problems
together, identifying the range of solutions together would
inform both Chambers in a much more effective fashion than we
are getting right now. There is a lot to be said for just
knowing what ideas will and will not fly on the other side of
the Capitol.
Representative Yarmuth. Thank you.
Do you have some thoughts, Ms. Coven.
Ms. Coven. Just really briefly. The only thing I would say
is that I do like the idea that a number of people have
expressed, and I think members of this panel, is making sure
that the Budget Committee can speak for both Chambers, whether
that is a Joint Committee or separate committees, and is well
represented in terms of your leadership, the tax-writing
committees, the entitlement committees, and so on.
So I just think if it remains, it should make sure that it
does speak for the Chamber and can provide leadership for the
rest of the Chamber.
Representative Yarmuth. Thank you very much. I yield back.
Co-Chair Womack. Senator Ernst.
Senator Ernst. Thank you, Mr. Chair.
And I would like to go back and revisit. We have had an
interesting conversation about the sticks and the carrots.
Because it is wonderful we are going through this process, and
I believe it is extremely important that we find a solution
that we can adhere to. But I think that many that have served
in the Senate and the House before us thought that they also
had a process that we could adhere to.
And I would argue, I again want to go back and visit some
of the sticks, because like No Budget, No Pay or No Budget, No
Recess, we have found that--and I am going to push back on the
shoddy workmanship, because I would say the omnibus bill that
we just had was shoddy workmanship. Four or five people
involved in a process. It is thrown together, we vote on it, we
go home. You know, everybody is maybe not necessarily happy,
but, wow, look, we have a product.
We have to do our job. And what we have seemed to find
lately in the United States Senate is, especially if you look
at our nominations process, which also seems to be hampered, is
that when the leader starts threatening to hold over weekends
or cancel recesses, all of a sudden we start getting our
nominations through the process.
So I do think that we should have a discussion. We should
not dismiss this just outright. I think that we need to be
doing our jobs. But we are humans, and we like to go home on
the weekends and we like to see our family at Christmas and
Thanksgiving. If those sticks are out there, perhaps we know
and we can plan ahead and understand that we need to get our
jobs done.
Would you please, if you could, maybe make comments about
sticks and carrots that have been used in the past, maybe in
your experience, that have tended to work or not tended to
work?
Mr. Holtz-Eakin. I don't have a long list of things. Most
of the things that have been used have been mechanisms designed
to make you hit a particular budgetary target, say, a deficit
target or a spending target. And you can override those
mechanisms. So they have not been effective at all. By and
large, process doesn't produce solutions.
There has been some No Budget, No Pay sort of sentiment,
and at least my understanding is that is probably not
constitutional, so I would suggest not going that route. It is,
however, I think constitutional for you not to see your family.
So I would echo what Martha said about the empirical
regularity with which things get done as you back up against a
recess or some other part of the calendar. That does seem to
motivate people to get things done.
Senator Ernst. Thank you.
Ms. Coven. Just one thing to add to that, which is that, as
you think about those kinds of mechanisms, make sure that the
collateral consequences fall on Congress and not on the
American people.
Senator Ernst. Exactly. I would agree wholeheartedly with
that. It is incumbent upon us to make sure that we get our jobs
done. And I would say, just as I stated in my opening comments,
that for 44 years only four times have we done our job.
So that speaks to, it is wonderful going through a process,
making sure we have rules in place to do that, but we have to
have the desire to get it done. Otherwise we just find ways
around it and we end up with continuing resolutions and omnibus
bills.
Yes, Dr. Holtz-Eakin.
Mr. Holtz-Eakin. I want to just echo something that Martha
said earlier, which I think is a good thing that you revisit
the budget process. There is no reason why you should budget
the same way all the time. Budgets should reflect priorities
and problems, and these change for the nation, and the process
should change with it.
And if you make changes, I believe the folks who make those
changes, meaning your colleagues and you, will have a buy-in to
make them work. And there is more to this than rigid mechanical
things. There is pride of craftsmanship and doing one's job
well. And if you settle on a new budget process, I think it
will, at least for some time, be in and of itself enough to get
things moving better.
Senator Ernst. Thank you. And I appreciate the time. And,
again, I am truly looking forward to this. I think we can find
a solution that hopefully we will be able to market and sell to
the rest of our colleagues. But it is up to us to get it done
and not look for specific loopholes that we can use in the
process.
So thank you. I yield.
Co-Chair Womack. Representative Kilmer.
Representative Kilmer. Thanks, Chairman.
And thanks again for being with us.
I think this conversation around carrots and sticks is
actually kind of an important one, in part because it seems
like a lot of the sticks that have been used that damage has
accrued to the American taxpayer or to the military. And in
part because when the sticks accrued to Congress, it finds a
way to get around it, right? It waives them.
So I think it is worth thinking about, is there more of a
positive inducement to get Congress to do the right thing? And
I know you have been asked that in various ways. But I would
just encourage us, collectively, to think about that down the
road.
I want to ask about when we get on the eve of a shutdown.
The Chairman asked should there be an auto CR. Some have
suggested an auto CR minus a percent or some have suggested an
auto CR plus a percent. And it seems like the problem is,
whichever route you choose, someone will like that route. And
it creates an incentive for inaction.
I understand that during the Clinton years they said no CR
beyond 2 days, and they did 21 of them, but they eventually got
there on an agreement.
What is the right, what do you think, on the eve of a
potential shutdown, what would you recommend as a smarter
approach?
Mr. Holtz-Eakin. My first recommendation would be for this
committee to be so successful that we are not on----
Representative Kilmer. Amen, I am with you.
Mr. Holtz-Eakin. That is the fundamental indictment of this
era, right?
Representative Kilmer. Yeah.
Mr. Holtz-Eakin. The second is, I think you should not rely
on a mechanism. Mechanisms become someone's preferred policy,
whether you anticipate it or not. Mechanisms can be overridden.
That happens all the time.
So if you are going to have a situation like that, empower
someone in the Congress, someone who has been elected to make
decisions, to make a decision to keep the government open. And
the idea of you handing over all of your hard-earned clout from
running for elections and being in the Congress, handing it
over to someone else to do whatever they want, is going to
really make you not want to do it.
Ms. Coven. I agree with that. I think you can't automatic
anything in this process.
Representative Kilmer. I know that there has been some
suggestion of taking OMB out of the budget process. I wanted to
get your reaction to that. And if that happened, wouldn't CBO
need a whole lot more resources?
Mr. Holtz-Eakin. I was unaware of that. It is a bad idea.
The CBO was created because up until the 1974 Budget Act the
only source of budgetary information was the Office of
Management and Budget, and prior to that the Bureau of the
Budget. It is a good thing for the executive and for the
legislature to have their own entities.
And, bluntly, competition is a good thing. It is a good
thing for CBO to look over to OMB and say, ``Gee, do you think
they did a better job of figuring out what is going to happen
here?'' and vice versa. So I am inherently skeptical of
monopolies and government monopolies who know better than any
other.
Ms. Coven. I would also add to that that another really
important function of OMB, and particularly agency budget
offices, is they just have a lot more information about what is
going on, because they are operating in the executive branch.
So CBO performs a somewhat different function, and it is
the ultimate truth-teller, but you also need the agencies and
OMB aggregating this information, which they are privy to
because they are actually in the day-to-day operational mode.
Representative Kilmer. Yeah. You spoke about the importance
of CBO as a neutral voice, sort of calling the balls and
strikes. Are there measures you think we ought to take to
protect the integrity of CBO as an impartial referee in the
budget process?
Ms. Coven. I think it does a pretty good job. And I would
more caution you against tampering with their ability to tell
it straight than say that there are major reforms that are
needed now.
Representative Kilmer. Okay. You know what, I think I am
just going to leave it at that.
Thank you, Chairman. I yield back.
Co-Chair Womack. Thank you.
Senator Lankford.
Senator Lankford. Thank you. I appreciate this.
Let me try to pepper you all with a whole series of
questions. And first let me push on a little bit what we were
already talking about with auto CR.
You had mentioned not wanting to have auto anything, and I
understand that. We are trying to figure out how to be able to
make sure we protect us from having shutdowns. And at the end
of the day at some future Congress there is no resolution, how
do we keep us going, as you mentioned, hold the American people
harmless, put consequences here, to be able to get it done?
That has been the conversation about we don't go home,
there are automatic quorum calls where we stay in session
continuously until we get it finished. But there has to be some
kind of process to make sure that the American people are held
harmless in this. That is going to require some mechanism in
place, policy-neutral or not, some mechanism has to be there.
Agree or disagree? That would mean something has to be
automatic, I would say.
Ms. Coven. Not if it means an automatic CR, no.
Senator Lankford. Okay. What would you recommend instead,
you get to the end of a budget year?
Ms. Coven. I think what we find is Congress pretty quickly
figures out that it has created a mess and it cleans it up. And
that is a better thing than putting the government on
autopilot.
Senator Lankford. Okay.
Mr. Holtz-Eakin. My suggestion was an automatic decision-
making process, kick it to the majority leader of the House and
the President pro tempore of the Senate, just to make it up on
the spot. But somebody has to make a decision on what will or
will not get funded, and the threat of handing it over to those
individuals is what should motivate you to not end up there.
Senator Lankford. Okay. Let me bring back up the issue
about Budget Committee going away. That is an issue that has
been around for several decades at this point.
As I go through the notes of this body, in 1993, kicking
around budget reforms even at that point, 20 years into the
Budget Reform Act, the act of 1974, there was already this
conversation that was brewing about leadership establishing the
302(a)'s. And it would be leadership of the House and the
Senate being able to work through the process and then bringing
that to the body to be able to vote on. And then the body
establishes those 302(a)'s.
But basically you have got, as the term that was used
during that time by Senator Kassebaum, you have got someone
with a little more clout in the process to be able to make that
decision earlier on.
What is your thoughts about a budget, the 302(a)'s being
established by a leadership group, voted on by the House and
the Senate, obviously the President would have to vote on that
as well to be able to make it law, and then to be able to work
on from there?
Mr. Holtz-Eakin. So I think the key insight is that the
budget committees as they are currently constituted can't
remain. And the question is, do you want to make them more
powerful by putting on them leadership, Ways and Means, Senate
Finance, key committees like that, or do you want to make them
go away?
But they existed the way they do now because there was
supposed to be the entire scope of operation, revenues,
mandatories, discretionaries. They had that key coordinating
function. No one is doing all that so the Budget Committee has
no role.
Senator Lankford. Right.
Martha, do you have a thought on this.
Ms. Coven. I agree with that. I would just say that there
is some role for oversight of the budget broadly and that it
worries me to think that Congress would have no group of people
whose task was to be looking at the reports that CBO comes out,
to be thinking about the long-term fiscal trajectory, et
cetera.
Senator Lankford. No, I would agree with that. Currently,
our process is leadership decides everything at the end. How do
we switch it to where there is a decision at the beginning on
what the main number is and get more people involved in
oversight throughout the process, rather than no oversight
anywhere in the process and try to figure out how to be able to
resolve that?
Ms. Coven. Right.
Senator Lankford. The concept of CBO in some of the scoring
issues brought up before, CHIMPs, pension smoothing, payments
shifts. Even PAYGO has become just a speed bump of late rather
than something that is an actual mechanism.
Are there recommendations that you would make to be able to
reform some of these processes to make sure that they work?
Mr. Holtz-Eakin. So that is an issue that is broader than
CBO. There are scorekeepers, the OMB folks, CBO folks,
appropriators, Budget Committee staff, minority and majority,
who have met regularly for years and years, decades, and agreed
upon the budgetary treatment of certain transactions like
CHIMPs and a variety of other things.
You could legislate that they go away. Other than that,
there is nothing else that can you do.
Senator Lankford. Is there a gain to having them?
Mr. Holtz-Eakin. They are the little grease that is left to
get things through. And grease is great until you abuse it. And
so the question is, is it being abused?
Senator Lankford. Okay.
Ms. Coven. There is a stock of them built into the base. So
I think you can't just say let's get rid of CHIMPs without
acknowledging you are getting rid of billions of dollars of
budget authority that is supporting programs that you all have
voted for.
Senator Lankford. Does that budget authority, does that at
the deficits or is that----
Ms. Coven. It is part of the aggregate totals that you
provide when you pass an omnibus spending bill. And I just
think we need to acknowledge that that is part of the totals
that we----
Senator Lankford. Totally agree. Yeah, I totally agree. And
that has been my challenge, is if CHIMPs go away, you are not
reducing deficit, but you are getting a more accurate number
that is out there.
And part of the challenge that we have right now is
actually getting to the number. We have the number that is
budgeted, then you have CHIMPs, then you have OCO, and then you
have emergency funding. And everyone just says, no, but just
look at this number. But the total aggregate debt is something
completely different.
And if we are going to go through this process, I think
there should be some gain and to try to clean up so we get a
number that is actually the number.
With that, I yield back.
Co-Chair Womack. Senator Hirono.
Senator Hirono. Thank you, Mr. Chairman.
Thank you both for testifying.
Just before this hearing White House economic advisor Larry
Kudlow said, and I quote, ``Never believe CBO,'' end quote,
because he claims they don't score tax cuts right. Do you
agree?
Ms. Coven. I don't agree with that.
Mr. Holtz-Eakin. I have a lot of disagreement with that,
beginning with his misunderstanding the Joint Committee on
Taxation is responsible for scoring tax bills.
Senator Hirono. Congressman Kilmer asked whether we should
move to protect CBO's independence. And, Ms. Coven, you said
that you thought they do a pretty good job. But when we start
talking about some people wanting them to engage in dynamic
scoring and other ways to make whatever programs they are
pushing look better, maybe we do need to ensure the
independence of CBO, as long as we are looking to them as that
independent voice for us.
Ms. Coven. I think anything you can do to strengthen that
function would be terrific. And it is interesting to see how
that discussion played out on dynamic scoring because there is
what the Joint Tax Committee said and then there is what lots
of other people said. And then there is what a one-pager out of
the Treasury Department said. And people are hanging their hats
on whatever is convenient.
But I agree that protecting the integrity of what they
produce and the Joint Tax Committee is really important.
Senator Hirono. Do you agree?
Mr. Holtz-Eakin. I do. I would just hasten to add that in
my experience this is a very common occurrence. People are
always lobbying for their programs to be fantastic and free,
and they want you to say that. And it is business as usual to
ignore that and just do the work.
Senator Hirono. Well, I like what you said, that
competition is good, that we have the executive branch putting
out their best explanation of what is going to happen and then
we rely on CBO as an independent voice.
Well, hope does spring eternal that this Select Committee
will be able to come up with a budget reform that is policy-
neutral, because the broken process we have hurts real people.
And I wanted to ask Ms. Coven, one of our tasks is to
explain to the American people why the budget and
appropriations process, or lack of process, matters in their
everyday lives. And I am sure many people are unaware of the
serious challenges that agencies face during shutdowns or CRs.
And in particular, I am sure many people don't realize that
agencies like Labor, Education, and the others that you oversaw
face potential life-and-death concerns when faced with
congressional inaction.
My question to you is, could you elaborate on the situation
or situations you were referring to in your testimony where you
had to determine when a situation was so precarious that there
is a threat to human life?
Ms. Coven. Yes, I would be glad to. And thank you for
asking that.
So we have a law that has existed I think since the 1800s,
I want to say, called the Anti-Deficiency Act, that makes it
such that the executive branch cannot expend funds that
Congress has not provided.
So when the government is operating during a shutdown, one
of the tasks that executive branch officials are engaged in is
making sure that we do not violate that statute. There are
criminal penalties attached, too, if you want to talk about
sticks.
So we were in a situation during one of the shutdowns where
the WIC program, which provides nutritional support for infants
and pregnant women and young children, was starting to run out
of carryover and contingency funds.
And right before the government, thankfully, reopened, we
were in the process of trying to make a determination of
whether or not, per the terms of the Anti-Deficiency Act, there
was an imminent threat to the safety of human life if babies
were not going to be able to get nutritional support,
consulting with medical experts.
These are hours of my life I can't believe I spent and I
would love to have back. The idea that that is what we should
be engaged in when we are implementing the federal budget is
absurd, and it was heartbreaking to go through those
discussions with medical experts.
Senator Hirono. And that is just one concrete example of
our inaction, our inability to do our jobs, how it impacts real
life people, literally, in life-or-death situations.
Are both of you familiar with the Convergence Center's
``Building a Better Budget Process Report''?
Ms. Coven. Yes.
Senator Hirono. So would you care to comment, both of you,
on the report or any of the recommendations?
Mr. Holtz-Eakin. I would be happy to get back to you. It
would be a long, long answer. I would be happy to provide it.
There are a lot of interesting ideas in there.
Ms. Coven. I think the one quick thing I would call out is,
I do like the idea of sort of standardizing and more regularly
presenting to Congress and the public the snapshot of where we
stand and where we might be headed. And CBO does lots of
products like that. But I think there is some logic to
consistently providing information in a form that people start
to recognize and can use.
Senator Hirono. I think that is really important because of
their suggestion that we have a fiscal state of the nation
report every 4 years, for example, and a pretty regular
performance of portfolio of federal programs reports just to
let people know what the heck is happening. I think that is
good.
And then they also say that we should synchronize the
budget cycle with the electoral cycle. That is a pretty
straightforward recommendation. Do you have an opinion about
that particular recommendation?
Ms. Coven. The only thing I would say I think there was
some hinting at things that are a little bit more like a joint
budget resolution in that document, and I have urged caution on
that. I think that is not the best path to walk down. But in
terms of synchronizing the calendar, and particularly setting
limits on appropriations every 2 years, makes a ton of sense to
me.
Senator Hirono. Did you want to add to that?
Mr. Holtz-Eakin. I concur with that.
Senator Hirono. Thank you very much, Mr. Chairman.
Co-Chair Womack. Mr. Woodall.
Representative Woodall. Thank you, Mr. Chairman.
I will pick up on the Anti-Deficiency Act. We have talked a
lot about the 1974 Budget Act. But prior to the
reinterpretation of the Anti-Deficiency Act during the Reagan
era we didn't have these kinds of shutdowns, we were kind of on
autopilot.
Given your experience at OMB, Ms. Coven, you would have
said you would not support an autopilot. You don't want to go
back to the Carter days where the American people are held
harmless and the shutdown is just a word document. You want it
to have consequences.
Ms. Coven. I want Congress to make choices, yes.
Representative Woodall. Right.
Thinking about your calendar year idea, of course, we
started down this road in 1976, went back in 1986, and moved
the fiscal year from July to October. I went back and looked.
Just over the past 20 years, it turns out in 11 of those last
20 years, we didn't make it by January 1 either. So you have
solved half the problem with that idea.
Candidly, I think solving half the problem sometimes is a
pretty good start. Knowing of our failure to have those funding
decisions resolved even by January 1, you still see the merit
of the calendar year vision.
Ms. Coven. I do because the delays are shorter, which means
the implementation can happen more quickly and the agencies and
others who receive federal funds can make better use of them,
yes.
Representative Woodall. Mr. Holtz-Eakin, when we talked
about misusing reconciliation, I appreciate those comments in
Ms. Coven's testimony. She quickly corrected the record of
ObamaCare being a money saver, which, of course, is exactly
what CBO reported. Any time you start taxes in year one and
benefits in year five, you tend to create a money saver. We
gamed the system there. If we looked out over 20 years, we
would have gotten a different number, 30 a different number.
You said some of those games, CHIMPs, in response to
Senator Lankford's questions, weren't the purview of the CBO to
sort out. But given your experience as the scorekeeper, in the
same way that process changes can be used, to Mr. Kilmer's
point, in favor of or against folks who simply prefer that
policy, I found our CBO scores to be that very same way. I can
draft the legislation to achieve my goals in ways that pervert
CBO's scoring to give me the freedom I need to have my
language.
What have you learned about how we could address CBO in
ways that limit the perversion of some of the scoring games
that go on now?
Mr. Holtz-Eakin. CBO's job is to identify the federal
budget costs of legislation. That is its primary function as a
scorer. And it is not supposed to identify the benefits. It
identifies the federal budget costs over the budget window
specified by the budget committees at that point in time.
Sometimes it has been 2 years. Right now it is 10. It has been
a lot of things.
And for that reason, it is always possible to, quote, game
CBO, because they will score the legislation and not the
legislation's intent. And you can, by front-loading things and
leaving things out of the budget window, give a misleading
presentation of the intent of a bill.
I don't think you should pretend that you can fix CBO or
fix the scoring process to avoid that. You need to provide a
lot of information. You can ask CBO, what do the second 10
years look like? You can bring that into the debate on the
floor. And the way you stop those things is voting no.
Representative Woodall. I find it incongruous to have a
conversation about the critical importance of a nonpartisan
referee calling the balls and the strikes as they exist and the
understanding that I can recraft the rules for CBO to get just
about any result I want.
At the same time, it seems that the utility of an unbiased
scorekeeper is undermined by biased rules. I would also point
out, when we no longer even use the CBO's baseline, when we
find it not useful, there is some opportunity for change.
But let me close with this and ask you if you have counsel.
Yes, it is true we do things differently than anybody else
does. We have a budget that seems fairly partisan. We have
authorizers that do some oversight and not. And we have
appropriators who actually get the job done at the end of the
day.
I think that structure can be politically useful. It allows
lots of places to let steam out the system. Yes, we could be
more efficient. But I am not sure that efficiency and utility
are synonyms.
Do you all have thoughts on that as experts in the field?
Mr. Holtz-Eakin. I think it is a good observation. I mean,
I can say honestly that I thought one of my jobs at CBO was to
have Congress scream at me and vent their frustration. And that
was just part of going to the office, and that was fine,
because Congress needs to vent on occasion, but it also needs
to get its work down. If you need to do the venting first,
good.
Ms. Coven. The only thing I would add is that the biggest
observation I had, shifting from working in the legislative
branch to the executive branch, is that here there are 535
people all up for reelection. In the executive branch there is
one person up for reelection at most once. So it makes sense
that your process, with 535 people constantly responding to the
needs of the American people, is going to be a little bit more
complex than it is when one person is making decisions.
Representative Woodall. Thank you both.
Mr. Chairman, I yield back.
Co-Chair Womack. Ms. Roybal-Allard.
Representative Roybal-Allard. I apologize for being late,
but I had another hearing at the same time.
Being that I just came out of an appropriations hearing, I
am going to ask the question with regards to the appropriations
process.
One of the things that has always been annoying is to
receive a President's budget request that zeroes out funding
for a popular program that the administration knows Congress is
going to add back to the final appropriations bill. And then
this has a ripple effect throughout the budget and
appropriations, because in order to fund the program that is so
popular something else has to give. And then there is the
debate as to what that is going to be.
What recommendations do you have to maybe stop this
practice, which has been used by both administrations and both
parties? And what are your thoughts about how we should look at
the duplicative programs or cases where agencies are operating
somewhat outside the lanes even if the programs are popular?
Because I believe that that contributes to the overall budget
delays and problems that we face today.
Ms. Coven. So I think this happens in two kinds of
circumstances, and one, I think, is legitimate and one isn't.
The nonlegitimate use of what you described is when the
President fully supports that activity and is just playing
games to get the numbers to fit. And I think that is not
something that should continue. And, Congress, whatever
pressure you can apply to make sure it discontinues,
particularly in the agencies.
But there is a legitimate use of it, which is if what you
are asking the President for is a request that reflects what he
or she thinks the best distribution of resources across the
country is, it may well be that the President, again, who is
not quite as interactive with the voters on a regular basis, is
exerting some courage and saying: This isn't working and I am
zeroing it out, and I know it is popular, but I think these
resources can be spent somewhere else.
And I, frankly, think you want a President's budget that
makes some of those kinds of choices and shows you where, with
the full expertise of the executive branch, where you can make
shifts towards better use of resources. Then you all can decide
if that is a direction you want to follow or not. But you
wouldn't want the President anticipating what your political
choices are rather than providing you his or her best judgment.
Mr. Holtz-Eakin. So let me echo the second part of that. In
my experience in two White Houses, there were a long, long list
of programs that the career staff at OMB had identified as
candidates for elimination.
And so it wasn't so much the political process that was
doing it, it was the review process that looked for the
effectiveness of programs and whether they were meeting their
objectives. And then if they weren't, they should not be there.
So I think that is a legitimate thing and that you should
respect it.
I think the second part of the question was about really
oversight, right? If we have got duplicative programs and we
have things that are wandering outside their legislative
intent, the oversight process should be catching that and
reining it in. And if it is not, then that is the call for
better oversight.
Representative Roybal-Allard. And when I came in, was there
a question by Senator Hirono with regards to how we could make
the budget more transparent and understandable for the public?
Did I hear that?
Ms. Coven. I think she was referencing a proposal by the
Convergence Group that included this fiscal report, yes.
Representative Roybal-Allard. And you are going to be
responding in writing to that?
Mr. Holtz-Eakin. She asked for our thoughts on the whole
Convergence report and I thought it would be more efficient to
just get back to her.
Representative Roybal-Allard. Okay. All right. Okay, then I
will just leave it at that.
And it seems to me that there has been a growth also in the
number of policy riders that we have been considering in the
appropriations bills and that these policy fights are also
contributing to delays in the process.
Why do you think that is happening? And are there any ideas
that you might have as to how we can address this?
Ms. Coven. So I think it is happening because you have the
must-pass bills. And the remedy lies not necessarily in your
committee, the Appropriations Committee, although stricter
parameters, keeping those riders out would be terrific, but
more in the rest of the Congress making sure that there are
other pathways for those legislative priorities to get
addressed so the appropriations bills don't get bogged down
with them.
Representative Roybal-Allard. Okay. I think my time has
about run out.
Co-Chair Womack. All right. So the gentlelady is yielding
back.
All right. We have completed the Q&A round. Recognizing
that there is only a handful of our members left, I think it
would be appropriate, if anybody has a burning question that
can elicit a very brief response, I would be more than willing
to give that alibi right now to somebody if they wanted to ask
something.
Senator Perdue.
Senator Perdue. I am sorry. I would like to iterate,
though, for the record, I would love to ask both these
witnesses to provide this back to us, though, as a more in-
depth conversation about the Senate's--the budget is a
resolution. We pass it with 51 percent of the votes. The
authorization is a law. We pass it with 60. The appropriation
is a law. We pass it with 60.
Once the minority party has a budget resolution crammed
down their throat, it is very difficult for them, Republican or
Democrat, to come back in the authorizing process and play
ball. It is very difficult for them to come back in the
appropriation process and play ball.
Please give us your thoughts about that three-step process,
and talk to us about other countries that you found that have
done that. We can't find anybody that does a three-step
process.
So I think this authorizing issue is one we need to really
focus on. We haven't talked about it much today. But in
subsequent hearings, I suspect that we will end up going more
in-depth. But because of your two backgrounds, I would love to
get you on the record relative to that issue.
Thank you.
Co-Chair Womack. Thank you, Senator.
Mrs. Lowey.
Co-Chair Lowey. In conclusion, I think we have all asked
many questions, and perhaps we will save some of the other
questions or repeat them again for the next time. So I would
like to thank you both.
As I look back upon the appropriations process, it would
seem to me there are two things that are very evident. Number
one, when we got a topline number, the 302(b)'s, for each of
the committees, no problem. Our staffs worked together.
Number two, the only thing that caused some problems was
169 of them, shall we say, what some of us would call poison
pills, others might say, oh, this is a very important policy
decision.
So maybe if the authorizers did their work and the question
would be how do we keep those authorizing items away from the
appropriations process, we would be better off.
And I think, Mr. Holtz-Eakin, you mentioned something about
OMB, I think that is what you said, that we should be
respecting it and the process. And it really depends on who is
there at the time, because I would say I have had totally
different experiences.
And I don't want to blame it on different parties. But I
can remember one head of OMB who used to check in with me
three, four times a week. And I don't think I have spoken to
this head of OMB in the last 6 months.
So how do you keep the politics out of the process? Give
us, as appropriators, the information so we can move forward.
Because once we get those numbers, and I want to emphasize this
again, on Appropriations, the bipartisan work of our 12
subcommittees was so impressive. We got the numbers, we went to
work, we got the job done, and then some other policy issues
came up that would extend the process.
But how do we move it forward so that Democrats and
Republicans can do their work? And that is what I see as a
major challenge here.
But I think it is time for us to close this hearing. So let
me thank you both for your excellent testimony and say it is a
pleasure for me to work with my co-chair.
Thank you.
Co-Chair Womack. Always a pleasure and a privilege.
Thank you, Dr. Holtz-Eakin and Ms. Coven, for appearing
before us today.
I want to advise our members that they can submit written
questions to be answered later in writing. Those questions and
your answers will be made part of the formal hearing record.
And any member that wishes to submit a question or any
extraneous material may do so within 7 days.
And with that, let's go eat. The committee stands
adjourned.
[Whereupon, at 12:44 p.m., the committee was adjourned.]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
BIPARTISANSHIP IN BUDGETING
----------
WEDNESDAY, MAY 9, 2018
House of Representatives,
Joint Select Committee on Budget and
Appropriations Process Reform,
Washington, D.C.
The committee met, pursuant to call, at 10:00 a.m., in room
HVC-210, Capitol Visitor Center, Hon. Steve Womack and Hon.
Nita M. Lowey [co-chairs of the committee] presiding.
Present: Representatives Womack, Sessions, Woodall,
Arrington, Lowey, Yarmuth, Roybal-Allard, and Kilmer.
Senators Perdue, Lankford, Ernst, Whitehouse, Bennet, and
Hirono.
Co-Chair Womack. The committee will come to order.
We have a little bit different seating arrangement than we
did before. I am up here in a different ZIP Code, you know. And
we will see how this goes.
Good morning, and welcome to the second public hearing of
the Joint Select Committee on Budget and Appropriations Process
Reform.
The most important role given to Congress under the
Constitution is the power of the purse. Our panel is charged
with ensuring we can fulfill this essential duty.
Today's hearing is appropriately titled ``Bipartisanship in
Budgeting'' and reflects the consensus regarding our mission
and the goal for any potential recommendations. To be clear, we
are not in the business of prescribing specific budget outcomes
to benefit Republicans or Democrats. We want to ensure a budget
process that works for either party, regardless of who holds
the majority.
As we continue talking through possible improvements in
this committee, it is a pleasure to welcome other perspectives
to the ongoing conversation. Today, we are joined by a group
who have extensively studied the current process, observed some
of the problems with it, and developed their own solutions for
making it work.
From the Bipartisan Policy Center, we have Bill Hoagland
and Don Wolfensberger, both of whom have extensive backgrounds
in congressional procedure and history. And representing the
findings of the Convergence Building a Better Budget Process
Project, we have Emily Holubowich--I hope I have that name
correct--and Matt Adams--or Matt Owens. I am sorry.
Thank you.
And, with that, I yield to my co-chair, Mrs. Lowey, for her
brief opening remarks.
[The prepared statement of Steve Womack follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Lowey. And I do want to thank Co-Chair Womack for
his collaboration in arranging this hearing.
I welcome our witnesses here today to discuss
bipartisanship as it relates to the budget process. Our
witnesses include Bill Hoagland and Don Wolfensberger, two very
experienced former senior congressional staff who are now
affiliated with the Bipartisan Policy Center.
And I am pleased that we have Emily Holubowich and Matt
Owens, two participants from the Building a Better Budget
Process Project of the Convergence Center for Policy
Resolution. They will talk about the Convergence Center
process, which convenes groups of disparate stakeholders to try
to arrive at consensus recommendations, as well as the
substantive proposals that emerged from their dialogue on the
budget process.
Thank you all for coming. I look forward to an interesting
hearing.
[The prepared statement of Nita M. Lowey follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. In my introductions, I said ``Matt
Adams.'' I want the record to reflect that the first baseman of
the Washington Nationals is not with us today; it is Matt
Owens. I am a big baseball fan, so I don't know how I just came
up with that, but thank you.
I would now like to welcome our witnesses. Thank you for
your time today. The committee has received your written
statements, and they will be made part of the formal hearing
record. You will each have 5 minutes to deliver your oral
remarks.
Mr. Hoagland, you can begin when you are ready. The floor
is yours, sir.
STATEMENTS OF G. WILLIAM HOAGLAND, SENIOR VICE PRESIDENT,
BIPARTISAN POLICY CENTER, U.S. SENATE STAFF, 1982-2007; DONALD
R. WOLFENSBERGER, FELLOW, BIPARTISAN POLICY CENTER, FELLOW,
WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS, STAFF
DIRECTOR, HOUSE RULES COMMITTEE, 1991-1997; EMILY HOLUBOWICH,
PARTICIPANT, BUILDING A BETTER BUDGET PROCESS PROJECT,
CONVERGENCE CENTER FOR POLICY RESOLUTION; AND MATTHEW OWENS,
PARTICIPANT, BUILDING A BETTER BUDGET PROCESS PROJECT,
CONVERGENCE CENTER FOR POLICY RESOLUTION
STATEMENT OF G. WILLIAM HOAGLAND
Mr. Hoagland. Thank you very much, Mr. Chairman.
Co-Chairmen Womack and Lowey and members of the committee,
thank you for the opportunity to appear before you.
I have my list of favorite reform options, but today I will
focus just on one, and that is the often-discussed-but-never-
agreed-to biennial budgeting and appropriation process.
The written testimony provides the long history of the
congressional efforts in this regard. There are various
approaches to biennial budgeting and appropriations. But my own
thinking on this has evolved from initially not supporting it
to, today, supporting it from a split biennial budget and
appropriation process.
As early as 1987, a bipartisan agreement between the
Congress and President Reagan was reached, setting 2-year caps
on discretionary spending. This was followed with similar
bipartisan agreements in 1990 and 1997.
And the Budget Control Act, as you know, of 2011 set
appropriation caps for 10 years, through 2021. But those caps
were adjusted by the Bipartisan Budget Acts of 2013, 2015, and,
of course, most recently, 2018. And I predict that you will
adjust those final 2-year caps again in 2019.
In other words, 2-year caps over time periods seem to be
what Congress has abided to, and, therefore, institutionalizing
what has become standard practice seems like a recommendation
this committee could find consensus around.
Most recently, in 2016, both the House and Senate Budget
Committee chairmen, Mr. Price and Mr. Enzi, advanced biennial
budget proposals. Like previous proposals, they proposed that
the budget resolution be adopted in the first session, setting
forth appropriation allocations for the next 2 fiscal years.
But, unlike previous versions, they proposed splitting the
12 appropriation bills into half, 6 appropriations being
considered in the first year of the biennium and 6 in the
second. Mr. Price's legislation even specified what those six
bills would be, and they included Defense and Labor-HHS, so
that 75 percent of all appropriations would have been done in
that first biennium.
The Bipartisan Policy Center issued a brief report in 2015
entitled ``Proposals to Improve the Process,'' authored by two
of my former bosses, the late Senator Pete Domenici and Dr.
Alice Rivlin. Among other reform items, it recommended that we
move to a biennial budget cycle to address the goal of
transparency and timeliness.
A couple of quick comments addressing the skeptics of
biennial budgeting process.
Incentives are important for Congress to do its work.
On the stick side of the incentives, in the private sector,
nonperformance of a contract results in nonpayment. The
Domenici-Rivlin biennial budget recommendation concluded that
garnishing your pay would not pass constitutional muster, but
legislation to prevent all planned congressional recesses until
a biennial budget resolution was adopted could.
This is consistent with existing statute that makes it out
of order to consider any adjournment resolution in the House of
Representatives in the month of July that provides for an
adjournment of more than three days unless you have completed
annual appropriations or a reconciliation bill if ordered. A
similar prohibition for all months could apply to both the
Senate and House for failure to adopt a conference agreement on
a biennial budget.
I would make it mandatory, also, that the last
appropriation bill considered in a biennium is the legislative
branch bill, your funding bill.
On the carrot side, once a biennial budget agreement is
reached, setting the 2-year appropriation allocations, if it
does that, Senate rules could be adopted to eliminate the
filibuster on the motion to proceed the consideration of the
appropriation bill. This would not jeopardize in any way
senators' right to filibuster the underlying legislation but
would guarantee at least a debate moving forward on
appropriation bills themselves.
Finally, one of the reoccurring criticisms of biennial
budget has been the argument that making accurate projections
two years in advance is difficult. Nothing in a biennial budget
process precludes funding of supplemental appropriations if
needed for unanticipated and therefore unplanned emergencies. I
would argue that 1 off-year supplemental, however, is better
than having to do 12 appropriation bills every year.
Let me conclude with what so many others have stated
before. No process changes will make your decisions any easier.
Budgeting is governing, and governing is challenging. But the
failure of this committee I don't think is an option. Failing
to reach some consensus would once again telegraph to the
American public that the Congress was not willing to address
its most obvious, fundamental Article I responsibility, and the
result would be a further erosion of the confidence in this
critical institution.
But if this committee could reach agreement, if even on
limited changes to the process, it could set the stage for even
more fundamental comprehensive changes in the next Congress.
Your time is short, and the litany of reform options is
long. But I believe one of those bipartisan reform options'
time has come, and that is biennial budgeting.
Thank you, Mr. Chairman.
[The prepared statement of G. William Hoagland follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you very much, Mr. Hoagland.
Mr. Wolfensberger.
STATEMENT OF DONALD R. WOLFENSBERGER
Mr. Wolfensberger. Thank you very much. And congratulations
to you all----
Co-Chair Womack. Just make sure that mic is on.
Mr. Wolfensberger. Got it.
Co-Chair Womack. There we go.
Mr. Wolfensberger. Yeah. I just wanted to congratulate you
all on being appointed to this important committee and wish you
well in coming to some solution by your November 30th deadline.
I have been asked by the staff to give some background on
previous bipartisan efforts to reform the Congress. And so, I
have not confined mine simply to budgeting, but there is a lot
of that in this.
And what I have done in my testimony is look at six
examples of things that I was involved in through the Rules
Committee, through my leaders, Trent Lott and later Jerry
Solomon, and, prior to that, John Anderson, my first boss, to
try and improve things in the Congress.
So I am just briefly going to go through those six examples
and talk about briefly what prompted the formation of these
bipartisan panels to begin with, how they did, did they succeed
or fail, and then what lessons have we learned from previous
bipartisan efforts.
The first thing that I was involved in, 1969, was--or 1965,
I am sorry. I was an intern up here, and my boss, John
Anderson--I am from his home district in Illinois--sent me to
the Joint Committee on the Organization of Congress. It was
having hearings on congressional reform. So I monitored those
hearings, reported back to him, helped prepare his testimony
before the panel. He, at the time, wanted a joint committee on
government research, as I recall, and that was what my work was
on.
But the joint committee went through a long litany of
hearings that summer of 1965. They finally reported something
in 1966, but then it laid dormant for about four years. Why?
Well, it seems that the Congress no longer was broken, so there
was no need to fix it. Why? A guy name Lyndon Johnson was
President, and he was putting through his juggernaut of Great
Society legislation. And so things sort of laid dormant there
for about 4 years.
I returned to the Hill full-time in 1969. And, lo and
behold, it came back to life; the recommendations of the joint
committee came back to life. Why? Well, there was another guy
in town called Dick Nixon, who had some other ideas about how
to run government. And so Congress thought it might be a good
thing to address the ``imperial presidency'' now. So the
recommendations came to life. They were passed.
I think you could say that the whole idea behind that joint
committee was to modernize Congress, yes, improve its
resources, staffing, and so on. But, also, the Democratic study
committee was behind a lot of this, and they wanted to really
address the problem of conservative committee chairmen there
through the seniority system who were blocking a lot of
progressive legislation.
So one of the things done in that law that was enacted in
1970, the Legislative Reorganization Act, was a committee bill
of rights. And the Democrats addressed other issues through
their caucus rules changes, such as electing of committee
chairmen for the first time. I think that was in 1971 or 1972.
So that was my first experience. The next thing, though,
came about in 1972 when President Nixon started impounding
funds, withholding funds that had been appropriated by
Congress. Congress was furious. They appointed a joint study
committee, similar to this, to come up with some ideas as to
how to address that. What they came up with: a suggestion for a
congressional budget process and also an impoundment control
regime.
So those two things were recommended, but the Democratic
leadership decided, first of all, to go with impoundment
control. So they put that through the House and the Senate, and
then they became stalled in conference committee because one
side wanted a two-house approval of impoundments, the other
wanted a one-house veto of any Presidential impoundments.
When that stalled, they finally came around to what the
Republicans had been urging them, which is put the two
together, have some balance, have a congressional budget
process, impoundment control. That was done, and it went
through. And that became, of course, the Congressional Budget
and Impoundment Control Act of 1974.
The next thing that I was involved with in the 1973-1974
was a select committee, bipartisan, a select committee on
committees in the House. And they were tasked with realigning
committee jurisdictions. They came up with a proposal. It was
very sweeping, comprehensive, but unfortunately it got stalled
in the Democratic Caucus. Finally, the Democratic Caucus
brought out their own substitute, which left the jurisdictions
intact. And, as a result, the Bolling recommendations were
doused in favor of, basically, status quo.
The next thing that I was involved with, the Beilenson
bipartisan task force on budget reform in 1982. That basically
went on for about 3 years. Actually, it was renewed in the next
Congress. They came up with a set of recommendations. The Rules
Committee reported them, but it never came up on the floor. But
then, lo and behold, in 1985, we had a debt limit bill that
went to conference, and the opportunity was there, and the
Beilenson proposals were finally brought in together with the
Gramm-Rudman-Hollings deficit control measure, which had
sequestration.
Well, my time has run out. I did want to talk about the
other things. There was a leadership task force on ethics in
1989--Vic Fazio and Lynn Martin. I worked for Lynn Martin at
the time. Came up with some recommendations. The big thing that
you all may have heard of was they gave up honorary in favor of
a congressional pay raise. So that was sort of the carrot with
that one.
And the other thing was the Joint Committee on the
Organization of Congress, 1993-1994. Their recommendations
didn't go anywhere because the leadership, Democratic
leadership, in the House pulled the plug. They were not behind
it.
But we can talk a little bit later about what lessons were
learned from these various things. It is a mixed bag,
obviously, but leadership has a lot to do with--making sure
they are behind whatever recommendations do come out.
Thank you.
[The prepared statement of Donald R. Wolfensberger
follows:]
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Co-Chair Womack. Thank you, sir.
Ms. Holubowich.
STATEMENT OF EMILY HOLUBOWICH
Ms. Holubowich. Co-Chair Womack, Co-Chair Lowey, and other
members of the Joint Select Committee, I thank you for the
opportunity to testify before you today as a member of the
Convergence Building a Better Budget Process Project. It is a
distinct honor to be invited to represent my Convergence
colleagues.
As a senior vice president at CRD Associates, I have
advocated on behalf of several health groups through several
appropriations cycles. I participated in the Convergence
project in my role as executive director of the Coalition for
Health Funding, an alliance of 95 national health organizations
representing more than 100 million patients and consumers,
health professionals, and researchers.
In both the Convergence budget project and in my testimony
before you today, I am representing the views of myself and not
those of the Coalition for Health Funding, my employer, or the
health groups I represent.
I am not an expert in budget rules and procedure like my
colleagues from the Bipartisan Policy Center, but I am an
expert in what the Federal budget means to Americans and what
happens when the process goes off the rails.
As you know, the vast majority of Federal funding for
discretionary public health and health research flows from
Federal agencies to State and local governments, academic
institutions, and nongovernmental organizations in communities
across the nation. These entities rely on predictable, stable
funding to pursue their missions of protecting and promoting
Americans' health.
When the Federal budget process breaks down, dysfunction
disrupts their operations. New initiatives and new hires are
put on hold, procurement cycles lapse, opportunities are lost,
and the American people are ultimately hurt.
In the Convergence project dialogue, I saw an opportunity
to work with others who, despite our differing perspectives,
share an interest in making the process work. None of us are
naive enough to believe we can perfect the process or that
changes can work without the political will to make them work.
But even marginal improvements that bring about greater
predictability and stability would be welcomed by the
communities we represent.
So how did our group of strange budget bedfellows find
consensus?
In 2015, Convergence was funded by the Hewlett Foundation's
Madison Initiative, with additional support from the Stuart
Family Foundation, to elevate the voice of stakeholders who
represent those directly affected by Federal revenue and
spending decisions.
Convergence staff first conducted more than 100 interviews
with myriad stakeholders across sectors, constituencies, and
ideologies to solicit their perspectives on the budget process
and ultimately invited 24 stakeholders, including my colleague
Matt Owens and myself, to participate in the project.
For the next 16 months, we met under the guidance of the
Convergence staff and a professional facilitator to find common
ground and reach consensus. After our first meeting to identify
pain points in the current budget process and build camaraderie
and trust in sharing our misery, we focused on developing
principles that would serve as our true north in guiding our
discussions and evaluating our proposals.
After several meetings and iterations, we ultimately agreed
on nine principles to which a budget process should adhere and
that we have submitted to the record.
For me, the principle that resonated most is that the
process should be neutral or unbiased. As several of you noted
during your first hearing and as you noted this morning, Mr.
Womack, the process should not be designed to favor a
particular policy or outcome or ideology. This principle is
essential to any successful process reform and was key to
reaching consensus on our proposal.
If we had allowed our discussions to veer away from process
toward outcomes, I don't believe we would have reached
consensus. Without this principle and others, we don't believe
your attempts to reform the process will succeed either.
During the development of our nine principles for process
reform, four themes emerged that informed our thinking and may
inform yours.
The first theme is that elections drive outcomes. The
ultimate incentive for lawmakers to address any issue,
including the Federal budget, is whether or not their
constituents care about it and the extent to which it
influences their vote.
The second and third themes are that credible information
provided at the right time matters and that effective budget
institutions like CBO are crucial to the production of trusted
information.
The final theme and what I believe the group thinks is most
important is that new norms are needed to break bad habits. For
any budget process to work, you and your colleagues have to
want it to work and see the value in it doing so. As someone
who works in public health, I appreciate that behavioral change
is hard. If changing people's behaviors was easy, we wouldn't
be in the midst of an opioid crisis and an obesity epidemic. It
will take concerted effort on the part of you and your
colleagues to make lasting changes.
I hope my testimony has helped frame the Convergence Budget
Process Project and has provided additional context for our
proposals. My colleague Matt Owens will now review our five
consensus proposals for you.
Thank you again for this opportunity to be here today. I
look forward to your questions.
[The prepared statement of Emily Holubowich follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you, ma'am.
Mr. Owens.
STATEMENT OF MATTHEW OWENS
Mr. Owens. Thank you to the co-chairs and members of this
important panel for the opportunity to testify.
I have worked on behalf of research universities for over
20 years, and I have seen the consequences of Federal budget
process dysfunction. Student financial aid decisions are held
up, important medical research is delayed, and long-term
planning is made more complex and time-consuming because
Congress does not complete the budget in a timely or
predictable manner. This is highly inefficient. It wastes time
and institutional and taxpayer resources that would otherwise
be used to achieve the teaching, research, and service missions
of universities.
I chose to participate in the Convergence project for this
reason and in the spirit of what people at research
universities do every day; they seek to address and solve
difficult problems facing the Nation. My employer, the
Association of American Universities, supports the Convergence
group proposals for these same reasons.
Understanding that you have copies of the report, I will
briefly highlight our five consensus proposals.
The first proposal is what we call the Budget Action Plan.
It synchronizes the budget process with the electoral and
governing cycles, and it calls on each new Congress to adopt a
2-year budget that is signed into law by the President.
The Budget Action Plan has three required elements and one
optional provision. First, it sets discretionary spending
levels for 2 years. Second, it lifts the debt limit by any
shortfall agreed to in the legislation. And, third, it
authorizes a lookback report to analyze the impact that
enactment of the budget would have on the long-term fiscal
outlook. Additionally, the plan allows Congress the option to
consider one reconciliation bill per fiscal year.
Our second proposal requires the CBO to produce a report
that we entitled ``The Fiscal State of the Nation.'' It would
be issued during the Presidential election cycle and would
outline key information about our Nation's finances, including
but not limited to: long-term projections for debt, deficits,
interest payments, revenues, and spending; a breakdown of all
major revenue sources and tax expenditures; and any estimated
shortfalls in long-term spending programs.
This report would be widely distributed and provide
information in reader-friendly ways to allow non-Washington-
insiders to better understand the budget. We believe this
report would provide a full picture of the Nation's finances,
elevate public discussions about the budget, and help voters
make more informed choices at the polls.
Our third proposal seeks to reinforce the importance of the
long-term effects of budget decisions. We propose that every 4
years the GAO review portfolios of programs that involve long-
term or intergenerational commitments. The reviews would cover
programs grouped by topics such as retirement security, health
coverage, or national security. This information would also be
included in the ``Fiscal State of the Nation'' report.
Our fourth proposal is to strengthen the Budget Committees.
It was irresistible for some in our group to suggest
eliminating the committees; however, we agreed that the stature
of the committees needs to be restored to help improve their
ability to lead the process. We propose that the chairs and
ranking members of key fiscal and authorizing committees, or
their designees, serve on the Budget Committees. We believe
this proposal would ensure that those who are responsible for
carrying out the budget would be vested in the process to
develop it.
Our last proposal calls on Congress to give budget support
agencies, such as the CBO and the GAO, the resources necessary
to provide credible, high-quality, and independent information.
Our proposal includes new responsibilities for these agencies,
so it is important that they have adequate resources.
These five proposals will not yield a perfect budget
process; however, we believe they contain practical and
achievable measures that can be developed further to implement
a process that facilitates informed, unbiased, and sound
decision-making.
In closing, I will offer a shared view among our group:
namely, no single budget process reform or package of reforms
can by themselves remedy the prevailing dysfunction. Process
reforms alone cannot force Congress to reach budget deals.
Political will is needed.
But process matters, and small or large changes can create
ownership and buy-in for new expectations and norms for
budgeting. Right now, expectations are low and norms are
broken. It has been more than 20 years since all appropriations
bills were passed prior to the start of the fiscal year. Just
27 percent of Senators have seen the process work, and for
House Members it is only 16 percent.
As such, we believe our proposals are a strong starting
point for your consideration. On behalf of all the Convergence
project participants, we wish you success. Your work is
critical not only to effective Federal budgeting but also the
governance of our Nation.
Thank you.
[The prepared statement of Matthew Owens follows:]
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Co-Chair Womack. We appreciate the opening comments by our
witnesses here this morning. We are now going to begin our
question-and-answer period. I will begin first.
Mr. Hoagland, do you believe the debate over 2-year
budgeting has evolved? Is it time?
Mr. Hoagland. Absolutely. I go back a long way. When I
first arrived to the Congressional Budget Office in 1976, there
was discussion about this. In my written testimony, you will
see that even this young House Whip called Trent Lott was
recommending it back in 1981-1982. Leon Panetta, chairman, all
the way through, including his final job at Department of
Defense, was recommending it. It has evolved, and I think it--
as I said, it is a direction that is necessary.
As I also said, Mr. Chairman, in my opening comments, I
originally did not support it, but I see that we basically have
gone to the 2-year system, so let's go ahead and
institutionalize it through a biennial budget.
Co-Chair Womack. What do you think is different, in your
view, as we think about both the structure of the budget
resolution and the ability of the modern Congress--and I stress
the word ``modern'' Congress, ``modern Congress,'' meaning this
isn't your grandfather's Congress; I mean, this is a much
different time--our ability to handle all of the appropriation
bills in one cycle?
Mr. Hoagland. Absolutely. Part of my evolution over that
period of time when I was staff director of the Senate Budget
Committee was that I felt it was the responsibility of the
Budget Committee to produce a budget every year. As I watched
the evolution of an inability to get appropriation bills done
within the timeframe, it was a basis that gave me the thought
process to revise my thinking that maybe it is better to do a--
with the time that is limited to all of you, the issue of
transparency, the ability to have authorizations work their
will, I think it is--you just--your time is just limited more,
it seems to me, than in the days when I was up here back
working here.
I am not here, I am not watching you as closely as when I
was here on the Hill, but it does seem to me like your time is
much more restrictive than it was when I was working as staff
director of the Senate Budget Committee. And that time
limitation is what you are really working with.
Also, let me just say there is redundancy. It seems to me
like you vote on things an awful lot in a redundant way. Let me
give you a best example. I have a number of other
recommendations besides the biennial budgeting, but one of them
is that, if you pass a budget resolution, even a biennial or
even an annual, you have voted on increasing the debt limit. In
the budget resolution that you adopted earlier last fall, you
have a debt limit figure. You have already voted on it. And it
does seem to me like you ought to somehow institutionalize the
fact that you have voted once, that is enough.
Co-Chair Womack. Mr. Wolfensberger, your testimony
references congressional turf, ``turf'' with a capital ``T,''
relating to the congressional-executive branch relationship.
As you think about episodes of bipartisanship in budgeting,
how have Presidents and Congress been involved in either
promoting or inhibiting bipartisanship?
Mr. Wolfensberger. Yeah, that is a very good question. I
think Bill remembers better than I, because he was involved in
some of these things. But back in the old days, when you had
split control of the White House and the Congress, there were a
lot of budget summits, where they would convene the President's
top advisers and top leaders and committee folks from Congress
would convene out at Andrews Air Force Base and try and, at the
last minute, come up with some kind of a resolution.
You know, since then, I think that there has been more of a
low-key type of negotiation going on, on an ongoing basis,
between the executive and the Congress through each
appropriations bill, starting with the subcommittee levels. I
noticed that Mulvaney, the OMB Director, just sent a letter to
Chairman Frelinghuysen flagging some increases in the
legislative branch budget that is being looked at for this
coming year. And so I think that is kind of interesting to see,
you know, how much in advance he is keeping an eye on it. But
he is a former chairman of this committee and has a pretty good
idea of what goes on in that process.
But, you know, I think that the best that we can hope for
is that we have more agreements where they come together
earlier. And that is the main thing for me, is coming together
earlier. Waiting until you are into the new fiscal year
already, and you are still kicking the can down the road. So I
think that is the key challenge that this committee will face,
is how do you go about that, and I think biennial budgeting
would help in that regard.
Co-Chair Womack. Thank you.
Mrs. Lowey.
Co-Chair Lowey. Thank you.
Mr. Hoagland, you note in your statement that Congress
failed to adopt what you would consider to be real budget
resolutions in 7 of the last 10 years. You compare that to the
previous 34 years, when Congress failed to adopt a budget
resolution only 4 times.
What do you think accounts for the difference, and why has
the budget resolution process apparently fallen apart in the
last 10 years or so?
Mr. Hoagland. I wish I could answer that question directly.
I work for the Bipartisan Policy Center. It was founded by
Senator Dole, Senator Howard Baker, Senator George Mitchell,
and Senator Tom Daschle. We worked together to find common
ground. I don't mean to be critical. I just want to highlight
that the partisanship that exists here, I think, complicates
our ability.
The second thing is, I believe deficits matter. I think we
should reduce the deficit. But the tradeoffs here are so great
and so difficult that I think that has complicated the
decision-making process and forced the delays in making the
very, very hard decisions you have to make.
Let me also say, Madam Co-Chair, I was careful in what I
said. I don't want to offend anybody. But I don't consider the
last two budget resolutions to have been real budget
resolutions. They were adopted well after they were supposed to
be done, and they also were done with one purpose in mind, and
that was simply to create the fast-track reconciliation process
for consideration of legislation. That is not what--when I
began here, that was not what the budget resolution was meant
to do.
Co-Chair Lowey. I would like to follow up, Mr. Hoagland. I
see the benefit of setting budget targets every two years. But
as for appropriations, doing annual bills is one of the most
powerful oversight tools available to Congress, in my judgment.
The main source of delays, from my experience in recent
years, has been political disagreements about top-line totals,
not the time needed to actually write appropriation bills once
those disagreements were settled.
And I understand that a substantial majority of States and
almost all of the larger States now practice annual budgeting.
Should we see that as a caution against moving in the opposite
direction at the Federal level?
Mr. Hoagland. I think it is 19 States that have biennial
budgeting. I think it varies in terms of how they operate.
I do not see that the annual appropriation process is
working here. I am just simply suggesting, why not look at the
two-year process? You will be able to set those caps for two
years. And I think there is some efficiency to be gained in,
first of all, your ability then to have that second year be the
authorization and oversight year. That would take away some of
the pressure that is placed upon you.
And, in fairness, Madam Co-Chair, it is authorizations
first and then appropriations. And I am not suggesting the
appropriation process doesn't do a lot of oversight, but it is
really the authorization process, to me, that has failed under
this system. And this would strengthen--from my perspective, it
would strengthen the authorization process.
Co-Chair Lowey. Well, I am not sure we can resolve that in
the minute I have left. So I disagree on that. But----
Mr. Hoagland. Fine.
Co-Chair Lowey.----you are saying in your statement that
Congress failed to adopt what you would consider to be real
budget resolutions in 7 of the last 10 years. You compare that
to the previous 34 years, when Congress failed to adopt a
budget resolution only 4 times.
What do you think accounts for the difference, and why has
the budget resolution process apparently fallen apart in the
last 10 years or so?
Mr. Hoagland. Because of the increased degree of
partisanship up here and the very difficult decisions you have
to make as it relates to spending and revenues.
Co-Chair Lowey. I thank you for that answer. And I won't
have any time to go on, but it seems to me that that is the
real problem. And I am not sure that changing the system is
going to address the partisanship that, to me, is the core and
the base of the system.
Mr. Hoagland. Yes, ma'am.
Co-Chair Lowey. Thank you.
Co-Chair Womack. Senator Perdue.
Senator Perdue. I couldn't disagree more. We have been
trying to do it with kumbaya and all of that for 44 years. It
hadn't worked. We have only funded the government on time 4
times in 44 years since the 1974 budget act. And I have talked
to all the people who signed that bill who are still living; we
have looked at best practices. This is not something that we
are going to tweak around the edges and think that we are going
to all of a sudden eliminate partisanship and make this budget
process work.
First of all, it is not a budget process; it is a funding
process. And I want to echo what Senator Hirono has said every
time she has spoken in this committee, and that is: Whatever we
do in here, we have to, I believe, have a goal of never having
another CR, okay, that leads to an omnibus situation.
The problem in the Senate is different than the problem in
the House. The problem in the Senate--and I want to get to two
questions, because you four people have brought up now three
recommendations in here that I think are very salient.
Number one, I think the biennial budgeting has merit. I
think we need to talk about it. I don't think it is a panacea.
If we do nothing but that, everything else will fail, period.
Number two, I believe that there have to be consequences.
Mr. Hoagland, you talked about consequences, and I would like
to come back and ask you about that.
But I want to emphasize what Senator Hirono was forcing us
to think about, and that is this is about funding the Federal
Government, not just creating a budget resolution. We created a
budget resolution. We did one in 2015. It only lived four
months, and it was a way to do the grand bargain.
I agree with you, Mr. Hoagland, that we have not done a
real budget since I have been in here in three years in the
Senate. Senator Enzi, the chairman of the Budget Committee,
actually has said publicly he would do away with the Budget
Committee unless we make some substantial structural changes.
And he has also said publicly that, in the Senate, we
probably have produced the last budget that can be done under
the current law, and that is that you cannot provide, unless
you do all the gimmicks that are out there and the fraudulent
things that if somebody in the private domain did they would go
to jail, like delaying expenses and accelerating revenue--
without doing all of those things, we will never be able to
comply with the balanced budget that we are talking about.
I want to talk about over here, though, Ms. Holubowich and
Mr. Owens, you mentioned the makeup of the Budget Committee,
and I would like to dwell on that just a second.
For three years, we have looked at the makeup of Budget
Committees and the process. The problem in the Senate is we
have a resolution--and it is not a law--that says 51 percent
can pass it. That is nothing but a political statement crammed
down the throat of the minority. Both sides have done it
repeatedly for 44 years.
Then you go to an authorization process that is a law. It
is 60 votes, has to be signed.
And so here is the problem. The minority party gets ignored
in the budget, now they come over and are asked to participate
in the authorization, they never do, neither side. Then you go
to appropriations, same thing. We have only averaged 2\1/2\
appropriation bills being voted on over 44 years, 2\1/2\ out of
12.
In the Senate, this thing is broken. Going to biennial
alone will not fix that. I believe that consequences have to be
considered.
The question I have for you is: The makeup of the Budget
Committee--we looked at best practices in other countries and
States. States have consequences. Nobody goes home until they
get a budget done. Other countries have gone away from a three-
step process to combining the budget work and the authorization
work into one, and the way they do that is what you are
suggesting.
So would you talk about how you would combine the--totally
change the makeup of the Budget Committee to include a
representation of ranking members and chairmen of the policy or
authorizing committees.
Until 2 years ago, we hadn't authorized the State
Department in 15 years. The authorizing thing is a fraud. We
have not done that for 20 years, maybe, in the way that we
should.
So if we could combine it, is there a way to address that?
I wish we had time to get more into consequences and all
that, because I would love to get you to comment on that, Mr.
Hoagland. But please be brief, and maybe we will get time to do
that.
Mr. Owens. Thank you for the question.
Our group discussed this in depth multiple times. And,
again, where we came out, through a consensus proposal, was to
get that buy-in, to have the chair and ranking members of these
committees come in representing those priorities, understanding
in some cases that may not always be possible in the Senate
because you have so many committee assignments, but bring in
their designees, and that the bringing those issues, to know an
authorization bill is coming forward in that calendar year, to
make sure that is reflected in what is developed in that
budget.
There were all sorts of discussions. We said at one point
maybe we ought to eliminate the Budget Committee. We talked
about reorganizing all of Congress and decided that was way
beyond our scope because of the issues you just identified,
Senator.
Senator Perdue. Well, we have changed committee
jurisdictions repeatedly over the last 100 years. That doesn't
scare me. And one of the problems we have, we have 16
authorizing committees in the Senate and 12 appropriating
committees, and it looks like a jigsaw puzzle, really, the way
the jurisdictions cross, and it is counterproductive.
So the question is, how would you deal with things like an
NDAA, for example--which is about the only thing we try to
really authorize every year? How would you deal with that if
you didn't have a formal authorization process but it was done
actually at the oversight level, in the Budget Committee, made
up of--if you made up the committee of ranking members and
chairs of these policy committees?
Mr. Owens. You know, I don't believe we went to that level
of depth to where you would be----
Senator Perdue. Okay. So you didn't get into those details.
I want to go back. Mr. Hoagland, you wanted to make a
comment----
Co-Chair Womack. The gentleman's time is up.
Senator Perdue. Oh, I am sorry.
Mr. Hoagland. The original Budget Committee in the Senate
was made up of exactly what you are talking about, which was
leadership. Senator Tower was defense. We had Senator Byrd on
the appropriation. We had the chairman and the ranking member--
early on. You had buy-in early on.
And I would also suggest that you could rotate--say, we
have the ag bill coming up for reauthorization. You could
rotate in the chairman and ranking member of those committees.
If get buy-in early, it seems to me, on the budget resolution,
that makes a difference.
Senator Perdue. Yeah. I would like to engage--in some of
our working groups; I would like to engage with you guys more
on those four topics you brought.
Mr. Chairman, I apologize for going over.
Co-Chair Womack. Let me remind our members up here to leave
these distinguished witnesses some opportunity to explain their
answers. They do deserve the time to give a good, articulate
response to our questions.
Mr. Yarmuth.
Representative Yarmuth. Thank you, Mr. Chairman.
I want to go back to biennial budgeting for just a second.
And one of the thoughts I had--I was a co-sponsor of
Congressman Ribble's proposal I guess in the last Congress. It
may have been two Congresses ago. I have lost track. And one of
the things that I was thinking about was that possibly, because
the exercise had become, in my experience, pretty much a
rhetorical exercise and it was a messaging exercise more so
than any serious budgeting operation, that by taking it to a
biennial basis you would actually begin to think more seriously
about longer-term consequences and longer-term spending.
Is that something that you think is an advantage of it
possibly, Mr. Hoagland?
Mr. Hoagland. I have always listed timeliness, long-term
planning, simplification, and transparency. And I consider
long-term planning to be an element of the biennial budgeting,
yes.
Representative Yarmuth. And a corollary, I guess, of that
of that question is that--some of the opposition to biennial
budgeting is that it is harder to project in a fast-moving
world and so forth and it is harder to project income and
occurrences. How would you respond to that argument?
Mr. Hoagland. I would respond that you are at least
setting--right now, you have already started the process of
setting along the discretionary side 2 years, so that is a
given.
Also, I would respond that, as I said in my oral testimony
and written testimony, there is nothing to preclude Congress
from having a supplemental for emergencies and unexpected in
that second year. So I still think it is possible to adjust.
Representative Yarmuth. Okay. Thank you.
The Convergence recommendations didn't deal with biennial
budgeting. You obviously had to have talked about it at one
point. What was, I guess, the deliberation there, and why did
you decide not to?
Ms. Holubowich. Sure. Thank you for that.
I think, for us, as we looked--one of our first exercises
was to map out the budget process and, with sticky notes,
identify what we saw as the pain points, and we realized that
they were really front-loaded, that when you have a top line
established and there is buy-in and agreement, the
appropriations process tends to really flow.
So I think, on our part, and part of our discussions, we
weren't convinced that the appropriations process was the
problem. It was the bottleneck created at the front as you saw,
sort of, political documents coming out that just, frankly,
weren't really based on reality and then the breakdown of
trying to operationalize that by the appropriators and trying
to make, for example, really deep cuts in nondefense
discretionary spending a reality. And that is where you see
bills like Transportation-HUD fall apart on the floor.
From my own perspective, I think, from a public health
standpoint, as we look at public health preparedness, biennial
appropriations, for me, is a problem. You know, we have
microbes evolving every day. Just this week, we have 17 new
cases of Ebola in the Congo. We have a new Australian virus
that is 1,500 years old that is making a resurgence.
So setting numbers at the top line for 2 years, I think,
makes sense. What we need, though, is that appropriations
process to make those course corrections on an annual basis, at
least from a public health perspective, to respond to these new
threats.
And, certainly, emergency supplementals are an option, but,
to be honest, you know, in my view, an emergency supplemental
should support acute, sort of time-limited, discrete events--an
infectious disease, a natural disaster.
There are lots of things that are happening that are more
systemic and chronic, like, for example, we now have babies
born from Zika moms who, as they now become toddlers of moms
who were infected with Zika and become school age, they are
going to have developmental disabilities, so now do we need to
reinvest in those areas. Or with the opioid crisis, we now are
seeing resurgence in cocaine-related and meth-related deaths.
And so those don't necessarily warrant an emergency
supplemental.
I think the emergency supplementals, as we know with Zika,
are not exactly predictable and stable and they sometimes take
way too long. And that whack-a-mole approach to, sort of,
supporting public health readiness is not ideal. We would
prefer to see those midcourse corrections sort of through an
annual review of really what is needed and where we need to
reprioritize.
Representative Yarmuth. But you could, even under your
argument, you could set top-line numbers for 2 years and then
appropriate on an annual basis.
Ms. Holubowich. Absolutely. And that is where we came out
in the Budget Action Plan----
Representative Yarmuth. Right.
Ms. Holubowich.--which is, again, reflective of sort of our
current reality. Our view would just be, let's try the best we
can to move that to the front end of the process at the
beginning of a new Congress, so we set that plan in that stage
at the outset and allow the appropriations process to flow
annually from----
Representative Yarmuth. Thank you.
A quick question for Mr. Owens. On a debt ceiling, is there
any difference between your proposal, which is to increase the
debt ceiling by whatever the budget prescribes, or just
eliminating the debt ceiling?
Mr. Owens. The way our group discussed it, we sort of left
that to the Congress to decide. But it is important that, when
you are making the spending decisions, and if it is going to
mean there is going to be a shortfall, that that should be
acknowledged in the same piece of legislation.
Representative Yarmuth. Thank you.
I yield back.
Co-Chair Womack. Senator Ernst.
Senator Ernst. Thank you, Mr. Co-Chairman.
And thank you, for the witnesses that are here today.
Mr. Hoagland, in your testimony, you mentioned the
importance of incentives for Congress to get their work done on
time. And, as you know, since 1974, Congress has passed all of
its appropriations bills just four times, and that is pretty
paltry. And in the past 20 years, Congress has passed a budget
resolution only 11 times.
And, unfortunately, this hasn't stopped Congress from
taking a month-long recess right before the start of each
fiscal year. And if Congress hasn't passed a budget and regular
appropriation bills by August, they shouldn't be able to go on
vacation. That is what I think.
And can you discuss the impact that this type of reform
would have on ensuring that we get our work done on time?
Mr. Hoagland. Yes, Senator. Thank you.
The bottom line here is that we have looked at exactly what
you are talking about, a way that penalizes you for not getting
your work done. Senator Domenici and Dr. Rivlin looked at the
issue of pay. There may be a way to dock your pay for not
getting your work done, as it happens in the private sector.
But there are provisions within the existing law that says
the House cannot go on recess until you have completed your
appropriation bills through the month of July. You cannot take
recess. So I see no reason why you can't change the Budget Act
to make it apply across the board: no recess unless you have
passed either a biennial budget or a budget resolution on time.
Now, you waive this, obviously. I don't know how to prevent
Congress from waiving the points of order that lie against you
for going on recess. But it is easy--it seems to me you have it
already in the law that you are not supposed to go on recess.
Senator Ernst. Yeah. And I do think that is a great point.
And it circles back something I brought up, I believe, in our
last meeting as well, but that we have processes in place and
we don't follow them. We can put new processes in place----
Mr. Hoagland.----and not follow them.
Senator Ernst.----and not follow them.
So we have got to get this figured out and find a way for
us to get our work done. Because we have a lot of folks that
just truly don't have the intestinal fortitude to get it done,
and we are failing the American people.
Second question. Mr. Hoagland and Mr. Wolfensberger, as
congressional staffers, you both witnessed something as rare as
a unicorn here in Washington, D.C., which was a budget surplus.
And over the past 50 years, the United States has only had a
balanced budget four times, 1969, and then from 1998 to 2001, I
believe.
So, as our deficit approaches $1 trillion, what can we
learn from those past Congresses?
Mr. Hoagland. Very briefly, and then I would turn it to
Don.
The bottom line there again was that--I was involved in the
1997 balanced budget agreement that we reached. That was
reached in a bipartisan manner, including President Clinton and
a Republican-controlled Congress. It meant giving up on
revenues, that Republicans had to agree to some revenues. And
it also meant that Democrats had to agree to reductions in some
entitlement spending.
It has to achieve the bipartisan--we also--let's be honest
about it. We had a lucky economy that was also helping us reach
that balance during that period of time. But it was bipartisan.
Senator Ernst. Uh-huh. Thank you.
Mr. Wolfensberger. Yeah, I retired in February of 1997, so
I missed being on that glory road that Bill was talking about.
But, interestingly, I think the balanced budget agreement
that you had was in 5 years, and actually it was achieved in 2
years because of a little thing going on out in Silicon Valley.
I don't know what it was about, but----
Mr. Hoagland. Yes.
Senator Ernst. Very good. Well, I appreciate it very much.
I appreciate the input. And just bottom line, we need to figure
out what is going to get us to actually do our jobs. So I
appreciate it. Thank you to the witnesses today.
Thank you, Mr. Chair.
Co-Chair Womack. Thank you, Senator Ernst.
Before we go to Senator Bennet, there has been some
discussion recently about a previously scheduled Joint Select
Committee hearing on May 18. I just wanted to say for the
record today, because we have members that are coming and going
and staffs that are coming and going, the co-chair and I talked
about this last week, and we both have agreed that, due to the
funeral of Senator Daniel Akaka and the fact that our Hawaiian
members are not going to be here that day, and there are others
that have indicated they may not be here that day, that that
May 18th hearing is going to be rescheduled.
So, for planning purposes, let's go ahead and make sure
everybody is on the same page there. Date to be determined, but
the Member day will, of course, be rescheduled.
Senator Bennet.
Senator Bennet. Thank you, Mr. Chairman, and thank you for
this hearing.
Mr. Hoagland, I wanted to start where Senator Ernst ended
with you, which was in the 1997 agreement. And you mentioned
you got lucky because you had a strong economy. We have a
strong economy right now, and we are going to have a trillion-
dollar deficit next year.
And I wonder whether you could share with the committee
what the common elements were that made it possible to reach
the kind of agreement that you participated in in 1997 and what
is missing today.
I mean, you mentioned that Democrats gave on revenue,
Republicans gave on entitlements. I don't actually think about
it that way, really. I think about the responsibility that
people seemed to have--or the consideration that people seemed
to give to the next generation of Americans, which we seem not
to give to the next generation of Americans.
Mr. Hoagland. Yes, thank you, Senator.
I will simply say that a critical element of that 1997
agreement--you have to remember, we came off a very tough time.
In 1994 and 1995, we had government shutdowns, we had clashes
here, we had a long period of discontinuity in all that we were
doing. But it turned out that we finally had leadership, and
leadership out of the White House, particularly. And I am sure
I am getting myself in trouble here by saying this as a
Republican. But you need leadership to say that debt does
matter, that deficits do matter, and that we should be focusing
on those issues.
There was consensus up here that deficits mattered. I am
not convinced today that, with all due respect to all of you
members here, that you consider deficits to be really a
situation that is going to impact our future generation.
Senator Bennet. I heard testimony earlier today about the
importance of having the annual budget so that we could respond
to health situations. And it made me think about an opioid
crisis which we have barely responded to. We claim that we have
responded to it, but we have barely responded to it, and I
think because the deficit has robbed us of our imagination to
do that. I mean, for the first time since John Glenn went to
space, America can't send anybody into space. And I think that
is a consequence, also, of our deficit.
Mr. Hoagland, I also wondered--I know this is an issue that
you care a lot about and have for a long time as a Republican--
whether you could talk about your view of the debt limit, the
debt ceiling, and its use as a device for claiming fiscal
responsibility. Whether the threat to the sovereign debt of the
United States is something that we should appropriately do, or
is there some other way that we should--what good could this
committee do on that question, Mr. Hoagland?
Mr. Hoagland. First of all, I think Congress should find an
alternative to the periodic threat of a government shutdown or
the brinkmanship over the debt limit to force action. Because
my impression is that it really hasn't. Maybe back in 1985,
1986, when we went through Gramm-Rudman-Hollings. That was a
debt limit issue. We got Gramm-Rudman-Hollings because it was
tacked on to a debt limit increase. Senator Gramm was worried
about the debt going up to $2 trillion, and so that--and now we
are at $22 trillion or so.
So, first of all, in fairness, the Bipartisan Policy Center
has a group of six bipartisan individuals, former Members and
former executive officials, and we have been working on a
proposal. It is no surprise here, it builds upon the old
Gephardt rule that, once you pass a budget resolution, it is
automatic. In fact, that was something the House used to do.
The Senate did not have that Gephardt rule. Or in combination
with the McConnell rule, which is that if you do not pass a
budget resolution, then the President should submit a
suspension request, and then Congress should vote on a
possibility of a resolution to approve or disapprove of that
suspension.
I think it is critical that you try to get this thing out
of being the brinkmanship. It has not solved the issues of debt
and deficits going forward, and I think it jeopardizes the
country's economic future when you have to go through this.
Senator Bennet. Well, I appreciate that answer. And I am
sure there are other members who feel this way too, that when
you develop that proposal we would be very interested to see
it.
Mr. Hoagland. I would be happy to.
Senator Bennet. Thank you, Mr. Hoagland.
Thank you, Mr. Chair.
Co-Chair Womack. Mr. Arrington.
Representative Arrington. Thank you, Mr. Chairman.
And I want to thank the panelists for your input, insight,
and counsel as we deliberate on how we can put some sanity and
responsibility into this process.
I am a new Member, so don't blame me. No, I am kidding. But
my conclusion that I have come to very quickly and I think is
painfully obvious to everyone else on the outside: The
political will collectively does not exist on the budget
outcome piece of this.
Now, I do think we can find ways to have a more timely
process and add certainty--which I think there are good,
fiscally responsible aspects to having certainty and stability
and continuity.
But I am just very concerned about how in the world--and to
my colleague Senator Ernst's comments about incentives. We are
looking so desperately for ways to force us to do things that
this body politic will not do, that the dynamics just don't
exist. And they don't exist with Republicans any more than
Democrats, I learned this year.
We sent a budget to the Senate, and it was a
reconciliation, got it mandatory spending, which is driving the
debt--we all know that too--and we couldn't get it out of the
Senate.
Representative Arrington. So give me a suite of--or us--a
list of incentives or accountability measures that we should
consider that maybe have not been considered so that we can
just take those and begin to noodle on them and debate them
among ourselves. And that is for timeliness, efficiency,
process-oriented and for the, sort of, responsible outcome
orientation. What are those?
And if you don't mind, we will start with Mr. Hoagland and
just kind of work our way down. Just rattle them off.
Mr. Hoagland. Real quickly, I have already stated, I think
no budget resolution, no pay, no recess. I think those are the
strongest ones. That is on the stick side.
On the carrot side, I still believe that if you could pass
a budget resolution, a conference agreement, that we should
eliminate the filibuster on the motion to proceed on
appropriation bills in the Senate.
Representative Arrington. Mr. Wolfensberger.
Mr. Wolfensberger. Thank you.
I am not quite as drastic as no budget, no pay, but I had a
compromise that, for every day after October 1 where you have
not completed action on your appropriations bills, you put in
escrow $100 a day of Members' pay. You get about $400 a day,
believe it or not. But that might drive some things.
With respect to the comments Mrs. Lowey made about losing
control of the process, I have been very sympathetic to the
appropriators, even though I support biennial budgeting, but I
have been thinking through a process whereby you might do four
of the big bills annually and the rest biennially.
And I am looking at the four that you would do annually--
because all but one requires an annual authorization--defense,
MILCON, vets, foreign ops, and homeland security. Homeland
security does not yet require an annual authorization. But
those four I think might be worth doing on an annual basis as
sort of a compromise.
But I know that, in the past, the appropriators have been
very successful in defeating biennial budget proposals when
they get to the floor. Mr. Dreier had 245 cosponsors for his
measure to have biennial budgeting, and when he got to the
floor on an amendment that he offered to do that, he only got
201 votes. Some people went south. So it is a very difficult
nut to crack, and----
Representative Arrington. Let me keep it moving----
Mr. Wolfensberger. Yeah.
Representative Arrington.----if you would.
And the question is, what carrots and sticks should we
consider to motivate the House and Senate to do the job that
everyone in the country does but us?
Ms. Holubowich. Well, thank you. We spent a lot of time
discussing this. You will notice we did not make
recommendations around incentives. In part, we didn't feel like
that was our role, and, also, I think we couldn't come to
agreement. You know, it wasn't clear that, to Senator Ernst's
point, you could do much of anything to force yourselves to
make these choices.
Ultimately, again, to our theme that elections drive
outcomes, I think where we get at this is through the proposal
for ``Fiscal State of the Nation,'' in the same way that my
organization presents my financials to my members, as
corporations share with their shareholders. There is a real
disconnect, and it is not their fault, but Americans just
simply don't understand what the government is doing or what it
is paying for. And they say they want a smaller government, but
when you propose cuts, they don't want you to cut anything, and
definitely don't raise my taxes.
So, I mean, you are in a box where it is hard to make these
choices because, I think, the American people just simply don't
know what you are doing. So the hope is that the ``Fiscal State
of the Nation'' can help elevate the conversation about our
Federal Government's budget and sort of bridge that disconnect.
Mr. Owens. I would just add briefly, as Emily said, we
didn't reach any consensus on this, but we did talk about no
budget, no pay. We talked about no budget, no recess. We even
talked about no budget, no fundraising. We talked about a lot
of different things, that, again, what drives outcomes are
elections ultimately.
So we couldn't reach consensus, but if there is something
this body can adopt that you think will propel you towards
action, then you should most certainly consider it.
Representative Arrington. Mr. Chairman, I have gone over my
time. I yield back.
Co-Chair Womack. Mr. Woodall.
Representative Woodall. Thank you, Mr. Chairman.
And thank you all for being here. I value your expertise.
I want to pick up where my friend from Texas left off. Lots
of ``no budgets, no something'' in the tool of incentives, and
yet my Budget Committee chairman in the Senate says we might as
well just abolish the Budget Committee because it is not a
functional process anyway. My friend Mr. Hoagland says, you
know, we have gotten two budgets passed the last two cycles,
but I don't consider those real budgets anyway, though they
would have met the standard for any ``no budget, no anything.''
I want to explore the notion that maybe it is not that
folks aren't doing their jobs, but maybe folks are doing their
job. And some folks are sent here to slow a process down as
opposed to speed a process up. I think it was Coolidge who said
his most important job was vetoing bad legislation, not signing
good legislation. A lot of Members of Congress feel the same
way.
Mr. Hoagland, you talked about the debt ceiling. And
everybody has had a similar conversation, of course. I have
been here since the big freshman class of 2010. Every single
measure that has moved spending and deficits in the right
direction--and, for me, the right direction is down--came in
the context of a debt ceiling debate--no other measure, only
debt ceiling debates.
And so I want you to reconcile for me your real desire to
see real progress made and my real experience that the only way
that progress has been made has been through debt ceiling
discussions and your position that we should eliminate those
debt ceiling discussions, moving them into the budget
discussions.
Mr. Hoagland. Congressman, I understand where you are
coming from on this.
I do not think that Gramm-Rudman-Hollings, which was
designed to bring the deficit down--when we look back on the
history of that, it turned out that that was not successful in
that regard.
The last exercise you went through in increasing the
statutory debt limit had no effect whatsoever on spending, from
my perspective. Your adjustment to the caps came later.
So I just respectfully disagree. I have not seen where the
debt limit has done nothing more than create a crisis, as it
relates to the financial markets out there, that we are
possibly going to default. And I don't think we ever--I don't
think this country ever will default.
Representative Woodall. The most constructive deficit
reduction measure in my 7 years was the Budget Control Act,
pushed by John Boehner and President Obama that set budget
caps----
Mr. Hoagland. In 2011.
Representative Woodall.----reduced spending, came only in
the context of a debt ceiling deal.
Mr. Hoagland. But then you adjusted the caps every year
thereafter.
Representative Woodall. Well, not----
Mr. Hoagland. Not the first year.
Representative Woodall. But that is exactly right. And
traded off with spending reductions up to or beyond the change
in those caps, with the exception of this last cycle.
Let me think about the work that you all are doing with
reconciliation at Convergence. Part of the Budget Control Act--
again, I think it was the best vote I have taken since I have
been here--was creating the joint select committee to bring
deficit reduction measures to the floor or tax increase
measures to the floor, whatever you wanted to bring to the
floor. Thoughtful members, 16 thoughtful members, looking at
literally hundreds of trillions of dollars in Federal outlays
going out over decades, and found not one penny on which they
could agree.
I don't actually think our challenge is too many chances at
reconciliation. I think our problem is not enough chances at
reconciliation.
Tell me how, knowing that we have shared concerns about the
fiscal direction of the country, how limiting our ability to
move a 50-plus-1 deficit reduction measure, limiting those
opportunities to once a year, as opposed to currently under
Senate rules three times a year, moves us in the right
direction.
Mr. Owens. I think it was the view of our group that
reconciliation, in some ways, has become used basically just to
get around and move other types of legislation.
And so, as we thought about it and deliberated, we thought
the reality is, if you had one per year and it was authorized
in that Budget Action Plan, as we call it, it really would
focus the discussion up front so everybody knew what they would
be debating and what they would be discussing, and you would
have two opportunities within a Congress to accomplish what you
want to accomplish.
Representative Woodall. I credit Reid Ribble on biennial
budgeting. Much of his success was because folks knew who he
was as an individual, and he would vote for anything that he
thought would save his children and his grandchildren some pain
and frustration in the future.
I would just put on your thought list reconstituting that
Joint Select Committee on Deficit Reduction, a bipartisan,
bicameral committee much like this one. Anytime we have an idea
that may move us in the right direction, I would like to see
that come to the floor for that 50-percent-plus-1 to see if we
can make a difference.
I thank you, Mr. Chairman.
Co-Chair Womack. Senator Lankford.
Senator Lankford. Thank you, Mr. Chairman.
Thank you all for being here as well.
Let me click through a couple of things.
There has been some good conversation about finishing
elements, as far as how to get Congress to be able to act and
move on things. What about things like automatic CRs to try to
have something in place so we don't have a government shutdown
while Congress is negotiating and finishing things out? Let's
just pretend for a moment Congress doesn't get their work done
on time. How do we actually get that to move and hold the
American people harmless in the process?
Mr. Wolfensberger. Let me just dive in first.
I think that would be an incentive for inaction. Once you
have things on automatic pilot, there is no reason for Members
to go forward then on finishing the appropriations.
Senator Lankford. Is there a way to be able to design that
so that the pressure is put on Congress to be able to finish
the task so the American people are held harmless?
Mr. Wolfensberger. I commend your imagination to that
project, but, you know, I haven't thought of one.
Senator Lankford. Yeah. Okay.
Mr. Hoagland. Of course, there have been proposals in the
past to have an automatic CR, and the Domenici-Rivlin proposal
had an automatic CR. But we also talked about it in terms of
the context that that CR would start to--the amount of funding
would start to come down every month by a certain percentage if
you continued to enter that CR. That would create some
pressure, it seems to me, to address the issue that there
wouldn't be action on doing appropriation bills.
Senator Lankford. If we combine that with things like the--
let's say, in the Senate, you have mandatory quorum calls three
times a day, so you can't leave; you are there over a weekend.
So, while we are in that period, you are here----
Mr. Hoagland. Yes.
Senator Lankford.----and you have to be able to work
through it, so they are intended to be short-term.
Mr. Hoagland. Yes.
Senator Lankford. Okay.
Ms. Holubowich. Our group spent a lot of time talking about
automatic CRs or, you know, a CR-plus-inflation, or we even
talked about the idea of a super-sequester, again, as one of
those penalties, those sticks.
You know, I think, ultimately, we couldn't come to
agreement that this would be an effective tool. And I think the
fear, certainly on my part, again, as I spoke about public
health, is that the default becomes we just don't do it, and we
end up in sort of perpetual CR mode.
You know, I think we had hoped that, you know, through the
Budget Action Plan, again, getting that difficult decision
making up front would, you know, minimize the need for CRs
further down the road.
Senator Lankford. Which I would certainly hope for, by the
way. By the way, we are in a mode of perpetual CRs right now.
And so, to say that----
Ms. Holubowich. And it is not helpful.
Senator Lankford.----if we put some mechanism in place to
keep us from having a government shutdown, that is the target
for me, is how do we not have government shutdowns, because
that is detrimental to the entire Nation.
And when you try to weigh a government shutdown versus an
automatic short-term CR, I am going to go with an automatic
short-term CR every time rather than have a shutdown. But the
goal is those are very short and those are very temporary and
we stay here until things actually get done.
Tell me a little bit about the President's budget. Has that
been a useful document or non-useful document for us? It is
millions of dollars to create it every year.
Ms. Holubowich. Well, we talked about that. One of our
exercises was to actually take a step back and pretend we don't
have a budget process, we have a Constitution; how would you
design it? Matt and I were in the same group, and I was very
much, at the time, in a camp that the President's budget is not
helpful at all.
It is, though. I think if you think about it as a reporting
tool, you know, those congressional justifications really get
into the weeds. And that is your oversight tool, and that is
the reporting back to you on how they are spending the money.
Those are critically important. So, again, I think we thought--
--
Senator Lankford. So the information is important but not
necessarily the proactive look.
Ms. Holubowich. Correct. And I think, again, as part of
that Budget Action Plan, bringing the President in on those
conversations around the top lines and reconciliation and get
agreement up front really helps. That President's budget can
then be a symbolic policy document, in the same way our Budget
Action Plan would not preclude Congress from doing budget
resolutions if they similarly felt they needed to put out a
policy statement.
Senator Lankford. By the way, I would have no issue with
that, bringing the President on board. And so if we do a budget
document with leadership, with key members of Senate and House
committees, with the leadership of the House and the Senate,
creating a document that goes into law, that sets those top-
line numbers, gets that established early, gets the President
involved early. The President can still make recommendations
through the appropriations process to get it, but the
President's budget seems to be a distracting document more than
it does anything else. It has never, ever become law. But it is
a set of ideas. I am glad to be able to have the President and
agencies submit ideas, if nothing else.
Let me ask you one last question about authorizing and
appropriating. What about an idea like--we always get in to
this fight of we never authorize in appropriation bills, which
is a myth that goes back to 1974, because there has been
authorizing in every single one of them on some level.
What about combining the work and saying, if something is
going to be authorized in an appropriation bill, the
authorizing committee has to pass it first? So there is a
mechanism to say the authorizing committee, as a committee--it
may not go to the whole floor, but it goes to the committee.
They pass it as a committee. Then it could be inserted, and the
whole body would vote on it then in an appropriation bill to be
able to add it.
What about a blending of the two to be able to get those
committees working together?
Mr. Wolfensberger. I think that is more realistic than the
present rule, which says you have to have the authorization
signed into law before you can appropriate for them. So I think
putting the action in the particular house, authorize, at least
pass your authorization before you take up the appropriation,
that makes good sense to me.
Senator Lankford. Okay.
Thank you, Mr. Chairman.
Co-Chair Womack. Mr. Kilmer.
Representative Kilmer. Thank you, Chairman. And my
apologies. I was actually in an Appropriations subcommittee,
hearing from some constituents.
I want to start by asking the Convergence duo, your
proposal had us looking at some of the long-term drivers of
debt and deficits once every 4 years. We had bit of a
discussion in a committee markup yesterday about the notion of
having a fiscal state of the nation address, having the
Comptroller General come in. That is a proposal that Mr.
Renacci and I have introduced, which would really try to have a
joint session that is focused specifically on these long-term
fiscal issues.
I would love to get your sense of that, if you think that
having that type of mechanism in place would create more
transparency and maybe put a little political pressure on both
houses to try to get something cooking.
Mr. Owens. I would just say I think that proposal is very
consonant with what our group came up with, this notion of
having a deliberate way to look back and look ahead, where we
are going with our spending and revenues.
Ms. Holubowich. And, importantly, in a way that is
accessible to the American public. There is a wealth of
information out there that is available through CBO, GAO, Joint
Committee on Taxation. It is not accessible to the average
American.
So our idea was that, through this fiscal state of the
nation, CBO is combining and culling all that information and
synthesizing it, probably working with a communications firm to
help, but to translate that for the American public and to
really actively disseminate that. Our goal is not to produce
another report that just sits on the shelf and nobody looks at;
that it really becomes a part of the electoral process, it is
elevated in the debates, it is a part of the conversation, you
are referring to it on the stump.
And so whoever is delivering that message--I used to work
at GAO, so I would be happy to see the Comptroller General do
that. But it is certainly consistent with our recommendation.
Representative Kilmer. Thank you.
You touched on CBO, and I know that part of the report also
looks at the independence and maintaining the independence of
the CBO. I think that is really important. You want to make
sure there is an umpire who is calling legit balls and strikes.
Can you talk about some specific measures you think our
committee should look at that would maintain that independence
of the CBO?
Ms. Holubowich. We focused principally on resources for the
CBO and the other congressional support agencies, in part
because we have expanded their scope of work, so that is very
reflective of our proposals.
I can also tell you from my experience at GAO--and this was
a long time ago, but I worked on the healthcare team. At any
one time, we had 200 requests in the queue. It was at least a
year until we got to start on a project. That was more than 10
years ago and before the Affordable Care Act, so you can
imagine now what the backlog looks like, you know. So I think
it is extremely important to make sure you are investing in
those institutions.
We did not get into the issues around, you know, protecting
their credibility. That was not something, I think, we really
discussed, but certainly something we think is important.
Representative Kilmer. Do any of you have suggestions in
that regard?
Mr. Hoagland. I have one suggestion, Congressman. That is
that we had a major commission that you established; it was the
Ryan-Murray Commission on Evidence-Based Policymaking. It seems
to me that there ought to be a way to formalize the Evidence-
Based Policy Commission within the Congressional Budget Office,
establishing an organization that really looks at evidence-
based in terms of making policy.
Representative Kilmer. Thank you for that.
I know there has been some conversation already about how
do you ensure Congress doesn't just ignore whatever process we
come up with.
You know, I think some of the conversation has been around,
sort of, negative disincentives. Unfortunately, by and large,
when Congress has done that, the negative hit has been to the
American public. I think sequestration is a good example of
that.
We have been trying to noodle on whether there is some sort
of positive incentives that could push Congress to act, whether
that be expediting processes here or something else. I would
like to get your impressions, maybe collectively, if you have
suggestions on what that might look like.
Mr. Owens. Our group did discuss some of those carrots, so
to speak. And expediting processes was one of the attractive
features.
We didn't reach consensus, time and time again, on this
one. Because, at the end of the day, what someone saw as a
positive someone could easily construe a way that that could be
used against them as a negative for their interests. And so
that is why we just couldn't reach agreement on this one.
Other ideas that we surfaced on more of the carrot or
positive side dealt with setting aside, sort of, a pot of
money, that if Congress met its deadlines, then they would have
a way to expedite expenditures for certain things that they
considered a priority.
Again, that led to other people saying, eh, that is a
disincentive for me, because I would like to see spending go on
the down side, not the up side. So, hence, we couldn't reach an
agreement.
Representative Kilmer. Thanks.
Thank you, Chairman.
Co-Chair Womack. Thank you.
That completes our round. I understand that Senator
Whitehouse is on his way back, and so I do want to give him an
opportunity to ask questions. So, for the good of the order, is
there anybody else here that has a follow-up question that they
would like to ask of the panel while we wait on Senator
Whitehouse?
Mr. Woodall.
Representative Woodall. Thank you, Mr. Chairman.
Several folks have made reference to that we are kind of
existing in a biannual budgeting world today. But the truth is
we are existing in a biennial 302(a) allocation world today,
but we are doing none of the other work.
Candidly--Mrs. Lowey and I talk about it all the time--the
Appropriations Committee is working just fine. They do good
work every single year. They are successful every single year
once they get a 302(a) number. I don't actually consider that
to be the problem.
The problem is looking out, whether it is making a national
conversation out of a fiscal order of the United States--you
tell me which Presidential candidate in the last debate was
pressed on his or her plan for deficit reduction. Right? It
just wasn't a topic for the American people.
So help me to distinguish between where we are, which is a
302(a) world, and where we would all like to be, which is a
forward-looking glide path towards deficits going down, fiscal
sustainability of entitlement programs, et cetera.
Because I don't want to define what we are doing as
success. It seems to me to just be enabling the one group that
is getting its work done but doing nothing to empower all of
the other groups of government that need to begin to get their
work done.
Can anybody help me with that?
Mr. Hoagland?
Mr. Hoagland. The establishment of the 302(a)s before we
get to the 302(b)s is predicated upon there being a budget
resolution. So that is why I keep coming back to at least
having a budget resolution that establishes that or doing it,
as you had been doing it, external to the budget resolution,
passing a law that essentially sets those caps.
So I think that you are getting your work done because
there is a 302(a). You are getting your work done because there
has been an agreement to set that, either through the budget
resolution or through statutory legislation.
So I agree. I am looking at--I guess you have six markups
here in the House this morning, most of those in
Appropriations. The difficulty is, of course, you have to deal
with my old stomping ground across over here called the United
States Senate, and they have 302(a)s too. But if you can't get
those bills to the floor in the Senate, you will never get to
conference.
And so that is why I keep coming back to, if you could pass
a budget resolution and then you eliminate and get an agreement
on that, what those 302(a)s are, then you eliminate the need
for the filibuster on the motion to proceed.
Representative Woodall. Though, as you point out, when we
have been successful at that, it has not been with real
budgets, it has been with faux budgets that have gotten that
done, at least over the last couple years.
Don, you were working on trying to reorganize committees
and making them work better.
Mr. Wolfensberger. Well, you know, what the House has that
the Senate doesn't is the Rules Committee, which you sit on as
well as the Budget Committee. But what they have done there
when a budget resolution has not gone through the House and
Senate, the same one, is the Rules Committee puts out a special
rule saying that the amounts recommended by the Budget
Committee shall serve for the 302(a) purposes.
But then, if the Budget Committee doesn't report, well,
then you go back to something else. I guess we had it once
where the leadership decided what they would be. So it is very
tricky. But, you know, when you get to the Senate, you don't
have those same mechanisms that the House does.
Mr. Hoagland. That is right.
Co-Chair Womack. Senator Perdue.
Senator Perdue. Well, thank you.
Just a quick question for anyone who would like to respond
on this.
In 1965, our mandatory spending was about 34 percent of
what we spend as a Federal Government. Last year, it was almost
78 percent. And yet all of this hoopla that we have around the
budget and appropriations is around discretionary spending,
which is $1.2 trillion, $1.3 trillion. We are going to spend
$4.3 trillion this year.
I understand we have two trust funds, and they get income,
Medicare and Social Security. But, today, out of the $2.2
trillion of tax revenue we get in, we spend almost a trillion
dollars of that in mandatory--subsidizing Social Security,
subsidizing mandatory, and paying for Medicaid.
The question is, how can we really ever get control, long
term, of our debt situation unless we deal with the total
spending?
This is the only entity I have found in the world where the
budget process and the funding process only deals with 25
percent of what we spend.
Does anybody want to take that on?
Mr. Wolfensberger. Well, let me----
Senator Perdue. The question is----
Mr. Wolfensberger. Yeah.
Senator Perdue.----should we being looking at all of the
expenses, the subsidy expenses, not the parts of Social
Security and Medicare that are paid by the trust fund, but the
other parts that we are subsidizing into those?
Ms. Holubowich. So, if I may, this was one of the issues
that we discussed. I think, for Matt and I, we live on the
discretionary side, and, in some ways, we thought this is
unfair. We have to be reviewed every single year, and there is
no commensurate review on the other side of the ledger.
So I think part of our recommendation here around the
proposal to have the GAO conduct these long-term reviews for
multigenerational commitments would set up an opportunity to
have that conversation.
We spent a lot of time talking through, well, you know,
should we be sunsetting these programs? I think there were
those in our group who felt very strongly, and I know some of
the groups that I work with in my coalition--people rely on
these programs. You know, the idea that you could yank out the
safety net from under them, you know, because we let a program
sunset was very concerning.
So the idea here was, have these 4-year reviews by GAO,
have them be incorporated in the fiscal state of the nation to
elevate that conversation. And that deliverable provides an
opportunity for Congress to have that conversation around those
issues.
Did I capture that?
Mr. Owens. Yeah.
And if I can just add, respectfully, Senator, I don't think
most Americans understand exactly what you put forth. That is
not top of mind, understanding the Federal budget. And so that
is what is behind our recommendation, especially the fiscal
state of the nation.
And the reviews that Emily spoke to is, if more Americans
are better informed and it is discussed during a Presidential
election cycle and Members of Congress are forced to talk about
and take questions for that, that political will that is the
undercurrent of this entire discussion will become stronger,
because more Americans want to see action on this. But,
frankly, they don't have the information they need to help
encourage you to take certain actions.
Co-Chair Womack. Senator Whitehouse.
Senator Whitehouse. Thank you, Chairman.
And thank you all for being here.
As a member of the Senate Budget Committee, my
recommendations are focused mostly on the budget side and on
the Senate side, not on the appropriations side or the House
side.
And I would like to ask to put into the record of the
proceeding a letter that I have written to the chairs, making
some of those recommendations in writing for the Senate Budget
Committee.
Co-Chair Womack. Without objection.
[The information follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Senator Whitehouse. Thank you.
I also want to acknowledge the good work and advice of my
colleague Senator Perdue in some of the conversations we have
had leading up to that.
It seems to me that there are some very baseline facts that
need to inform any conversation about our long-term debt. And I
would like to ask all the witnesses just to kind of go through
this like a checklist, because I don't think there is much
debate about them.
It is commonly accepted, is it not, that the metric by
which a sustainable amount of debt would be measured is the
debt-to-GDP ratio? Whatever the disagreement might be about
what that ratio should be, the metric of debt to GDP is the
commonly accepted metric, correct?
Mr. Hoagland. Debt held by the public.
Senator Whitehouse. Correct.
Mr. Hoagland. Not the total debt.
Senator Whitehouse. Any further dispute with that?
Okay. We got all yeses with that adjustment?
The second observation I have is that we are highly
unlikely to achieve that debt-to-GDP ratio, whatever we should
determine it to be, instantly, which, to me, suggests that
there needs to be a glide slope of some period of years that
will put us on the path to that.
Is there any disagreement that that is simply a necessary
part of the analysis of getting to a sustainable debt-to-GDP
ratio?
Mr. Hoagland. I agree.
Senator Whitehouse. All agreed.
Mr. Hoagland. I agree completely.
But to Senator Perdue's comment, two-thirds of that budget
is on automatic pilot, so to speak, that being the Social
Security, Medicare, the entitlement programs. The only----
Senator Whitehouse. Well, that is a good lead-in to my next
point, which is that, if you are going to calculate deficit in
any particular period, you won't mathematically get it right if
you don't look at appropriated spending, plus healthcare
spending, plus tax spending--and when I say tax spending, I
mean the more than we actually collect that goes out the
backdoor of the Tax Code in various tax provisions--and then
revenues.
From a point of view of the mathematics, are those not the
four key elements without which you can't actually get to a
correct answer?
Mr. Hoagland. Correct.
Ms. Holubowich. Correct.
Senator Whitehouse. Correct. Okay. Good.
So the reason I ask what I think are these basic
foundational questions is because the present Budget Committee
process does not require us to do any of those things. It does
not require us to sit down and consider and vote on a
sustainable debt-to-GDP ratio. It does not require us to sit
down and discuss and vote on a glide slope that gives us a
reasonable period of time to get there. And it does not require
us to look at those four elements.
So, from a process point of view, that is part of the focus
of this letter.
Another piece of our problem is that, as has been
repeatedly pointed out, the budget reconciliation process has
been more or less hijacked to provide a fast lane around
traditional Senate regular order for particular political
priorities of the majority and, indeed, in some cases, deficit-
increasing priorities of that present majority.
Could I ask each of you to provide for the record your
recommendations as to what language we might consider to cabin
the budget reconciliation process so that it is redirected back
to its original goal, which is to keep our deficits and debt
under control?
That is going to take too long in my remaining 39 seconds,
but would you send that to us in writing so we have your views
on that?
Ms. Holubowich. Absolutely.
Senator Whitehouse. The last thing that I will mention, and
it is a corollary of this, is that presently there is no
procedural path in the Senate Budget Committee for bipartisan
work. I don't think we are going to get this done if we don't
have an avenue that encourages us to work in bipartisan
fashion. We can trade blows back and forth with majority-
driven, jammed-through-with-simple-majorities budgets and
reconciliation measures, but ultimately we are going to have to
look at this in a bipartisan fashion.
And so my urgent concern is that we create a parallel
bipartisan budget bypass just in case that bipartisanship can
be achieved. You can't mandate bipartisanship, but, by God, you
ought to make a way for it if it can happen.
Mr. Hoagland, you are energetically signaling.
Mr. Hoagland. I don't know if this rule still exists, but
under the earlier timeframe, if the budget resolution had not
been reported out of the Budget Committee in the Senate by
April the 1st, budget resolutions that had been introduced--if
you and Senator Perdue had introduced a budget resolution
yourself, it would have been automatically discharged and put
on the calendar.
That is one way of creating a--if the chairman and the
ranking member are not getting their work done, that doesn't
preclude the two of you from putting together your own
resolution and putting it out there.
Now, getting it off the calendar is a different issue. But
you could still do that under existing rules, as I understand.
Senator Whitehouse. There is an opportunity for
considerable mischief there, as well as considerable
bipartisanship.
Co-Chair Womack. Last question. Mr. Arrington, bring us
home.
Representative Arrington. Well, I want to associate myself
with Senator Whitehouse and the whole concept, notion of a
glide path and debt-to-GDP targets. We are looking for a
bipartisan way to move forward. I don't see any policy
orientation, Republican or Democrat, in that. It is just the
reality is we have to walk back that ratio to a healthy,
responsible level, and then it can be determined what dials to
use to get there.
I think, ultimately, though, you are going to have to have
some consequence if you don't get there. I just don't know
that--but it would be a great start, and I support that 100
percent. We have been talking about that.
So my question is this super-sequestration, because I would
have an idea--I don't know that it would be supported, but--and
I ran against sequestration, but I have to tell you, since I
have been here, I just think it was wrongly applied. I thought
that the idea was good in concept, but it missed 70 percent of
the spending.
So what is this idea of super-sequestration that you all
kicked around? And some of your thoughts around--I just was
intrigued, and that was my follow-up.
Ms. Holubowich. Sure.
You know, so I think where we came out is that ultimately,
again, that stick is a failure. And as I have known--full
disclosure, I am the founder and co-chair of NDD United
campaign. We advocated to raise the caps; we advocated to stop
sequestration. We are three for three. Thank you for that.
This is more than dollars on a ledger. This funding is
impacting people's lives every day. We have spent the last 6
years documenting the impact of this. It is too blunt a tool--I
am speaking for myself----
Representative Arrington. Yeah.
Ms. Holubowich.----too blunt a tool. It is too dramatic.
And it is not the glide path that I think you seek.
I would just say, you know, a word of advice, I think, from
our process, again, is to focus on process. We had these
conversations, and policy and process blur, but when you get
toward the outcomes, the energy in the room would shift, the
body language would change, and we would bump up against
impasse.
So I think for you all, focus on the true process, build
that foundation that will allow you through proposals like
ours--the Budget Action Plan, the long-term reviews--to address
the policies and the outcomes. I think you will be more
successful. I think that is how we were successful. And if,
again, we had focused on what is the appropriate debt-to-GDP
ratio, we would not be here today with a set of proposals for
you.
Representative Arrington. My only concern is I think you
make a smoother path right off the cliff. I mean, it won't be
as bumpy, we will be able to enjoy the ride a little bit while
we are, you know, still intact, and then we crash. And then it
is forced upon us, ultimately.
So, if you think the blunt instrument of having reasonable
walking-back of whether it is the dial of tax on the revenue
side or spending, wait until the sovereign debt crisis hits.
And you think the blunt instrument of any of these dials being
thrust upon us because of our lack of will--then I think that
is a much worse scenario to avoid. And I think we have to think
in pretty extreme terms to avoid that.
And, again, I would put revenue, just to be fair, and the
spending cuts, and then I would not negotiate away 70 percent
of the budget that is really driving the debt. That is really
my----
Ms. Holubowich. Yeah. I think we would see that as outside
of the process. I mean, that is the outcome that you are
striving for. You know, your charge is really, how do we build
a foundation and a framework to allow those conversations to
happen? I fear that, if you go down that path in this body, you
will not get to creating that foundation.
Representative Arrington. You know, I am kind of revealing
my--I want to get----
Ms. Holubowich. I agree with you completely. Yeah.
Representative Arrington. So, Mr. Chairman, I don't want to
take any more of everybody's time, but thank you, panelists,
and appreciate the feedback.
I yield back, Mr. Chairman.
Co-Chair Womack. Mr. Hoagland, Mr. Wolfensberger, Ms.
Holubowich, Mr. Owens, thank you so much for being with us
today.
Be advised that members may submit written questions to be
answered in writing. Those questions and your answers will be
made part of the formal hearing record.
Any members who wish to submit questions or any extraneous
material for the record may do so within 7 days.
And, with that, this committee stands adjourned.
[Whereupon, at 11:35 a.m., the committee was adjourned.]
THE BUDGET RESOLUTION--CONTENT, TIMELINESS, AND ENFORCEMENT
----------
THURSDAY, MAY 24, 2018
House of Representatives,
Joint Select Committee on Budget and
Appropriations Process Reform,
Washington, D.C.
The committee met, pursuant to call, at 10:45 a.m., in room
HVC-210 Capitol Visitor Center, Hon. Steve Womack and Hon. Nita
M. Lowey [co-chairs of the committee] presiding.
Present: Representatives Womack, Sessions, Woodall,
Arrington, Lowey, Yarmuth, Roybal-Allard, and Kilmer.
Senators Ernst, Whitehouse, Schatz, and Hirono.
Co-Chair Womack. Good morning. The Joint Select Committee
will come to order.
Welcome to the third public hearing of the Joint Select
Committee on Budget and Appropriations Process Reform. The most
important role given to Congress under Article I of the
Constitution is the power of the purse. Our panel is charged
with ensuring we can fulfill this fundamental and essential
duty.
Long before we began our work, there was bipartisan
agreement that the current process for completing this basic
function of government needs substantial improvement. And
during our hearing so far, we have identified some of the main
challenges with the current budget process.
Today's discussion will be more focused on the opening
piece in the process, the annual budget resolution. As
designated by the 1974 Budget Act, the budget resolution was
intended to help Congress govern effectively.
Unfortunately, the budget resolution, as we know it today,
is often associated with government dysfunction and
consistently missed statutory deadlines.
There even seems to be some confusion from Members in both
Chambers on both sides of the aisle about the value of even
doing a budget resolution each year. That is regrettable.
This apathy was clearly exemplified just 2 weeks ago in the
House Budget Committee during our Member's Day hearing, a
required forum and formal opportunity for Members to present
their budget ideas for fiscal 2019. Aside from members of the
Budget Committee, that forum was utilized by one Member.
While I was disappointed by the lack of participation, it
was a sobering illustration of the budget's need for our select
committee to succeed. During today's conversation, I am hopeful
that we can start determining ways to make the budget more
useful to Members of Congress and encourage engagement in the
process. And I also look forward to talking about ways to make
the budget resolution more realistic as a governing document,
ensuring that it can be effectively enforced.
Even though today is about the budget resolution, we cannot
ignore the fact that the appropriations process is inextricably
linked. The sooner that a budget resolution is passed in final
form, the less likely Congress will have to rely on an omnibus
or a continuing resolution.
However, as both an appropriator and as chairman of the
House Budget Committee, I recognize that we must be honest and
ask ourselves whether the modern Congress will ever be able to
successfully process 12 individual appropriation bills in a
single year.
This morning, to add to our conversations on this important
topic, we welcome several experts who have studied the budget
and appropriations process extensively.
Joining us for today's discussion, we have the president of
the Committee for Responsible Federal Budget, Maya MacGuineas.
Jim Capretta is here from the American Enterprise
Institute, where he serves as a resident fellow and the Milton
Friedman Chair. Jim brings a wealth of experience from his time
at OMB and as a Senate Budget Committee staffer.
Bill Dauster also joins us today, bringing his unique
perspective as a 30-year Senate staffer and the author of a
book on budget process law.
Finally, offering an outside academic's view, we have
Joseph White, a political science professor from Case Western
University.
Thank you.
And, with that, I would yield to the distinguished co-
chair, the gentlelady from New York, Mrs. Lowey for her opening
remarks.
[The prepared statement of Steve Womack follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Lowey. Well, thank you very much. And I would like
to welcome everyone to this hearing on the subject of budget
resolutions, their content, timeliness, and enforcement.
Once again, we have a very good group of witnesses. We have
Bill Dauster, who has formerly served as staff director and
chief counsel of the Senate Budget Committee and in several
other senior staff positions in the Senate and the White House.
We have Professor Joe White from Case Western Reserve
University, who, throughout his long career, has written,
thought, and taught about Federal budget policy and politics,
as well as about healthcare policy. And, further, the committee
will hear from two other distinguished budget experts. Maya
MacGuineas of the Committee for a Responsible Federal Budget
and James Capretta of the American Enterprise Institute.
I want to thank you all for coming. I look forward to an
interesting hearing, and I am sure you will share with us some
very important information on which perhaps we can come up with
some suggestions for change.
Thank you very much.
[The prepared statement of Nita M. Lowey follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you, Mrs. Lowey.
I would like to now welcome our witnesses. Thank you for
your time today, all of you. The committee has received your
written statements. They will be made part of the formal
hearing record, and each will have 5 minutes to deliver oral
opening remarks.
And, Ms. MacGuineas, we are going to begin with you. It is
an honor to have you, and I am going to turn the floor over to
you. Thank you so much.
STATEMENTS OF MAYA MAcGUINEAS, PRESIDENT, COMMITTEE FOR A
RESPONSIBLE FEDERAL BUDGET; JAMES C. CAPRETTA, RESIDENT FELLOW
AND MILTON FRIEDMAN CHAIR, AMERICAN ENTERPRISE INSTITUTE; BILL
DAUSTER, FORMER DEMOCRATIC STAFF DIRECTOR AND CHIEF COUNSEL,
SENATE BUDGET COMMITTEE; JOSEPH WHITE, PROFESSOR, DEPARTMENT OF
POLITICAL SCIENCE AND CENTER FOR POLICY STUDIES, CASE WESTERN
RESERVE UNIVERSITY
STATEMENT OF MAYA MAcGUINEAS
Ms. MacGuineas. Thank you so much. And thank you for
inviting me here today. I am really honored to be talking with
the committee and appreciate all of you serving on it. And what
has been great is it seems like you are off to a very strong
start, so that is very encouraging.
In our written testimony, we offered 26 different
recommendations which follow the five different budget areas
for improvement. These things range from changing the budget
calendar to standardizing baselines to making it more difficult
to waive PAYGO.
What I would like to do in my couple minutes of remarks
here is focus on three areas, and I am happy to discuss any of
the others we submitted as well. And those three include the
importance of getting something done. The importance of this
committee succeeding at getting something done.
Number two, ending crisis-driven budgeting. And number
three, developing a process, a neutral process that makes it
easier to agree to sound, sustainable budgets.
So, to start with it, it is clear that the budget is no
longer a statement of the Nation's principles or reflection of
a strategic national plan. When the budget even does exist, it
tends to be political statements filled with wishful thinking,
and it puts all of you as our leaders in the counterproductive
position of getting sucked into the partisan battle instead of
thoughtful policymaking.
This committee is not going to be able to fix how broken
our politics are right now or the extent of broken fiscal
situation facing the country, but getting something done that
both sides see as fair would be helpful as serving as a way to
reboot the whole process and will start with a new commitment
to actually following the reasonable budget rules.
The types of changes could include things you have heard a
lot about from other witnesses before from biennial budgeting;
changing the fiscal year; using the Fiscal State of the Nation
Report, which Congressmen Kilmer and Renacci and Convergence
and others have all talked about; changing the makeup of the
Budget Committees. But little steps can lead to bigger steps.
Second, one of the main problems that I assume you want to
solve is the threats of defaults and government shutdowns and
how to create dangerous situations in crisis-driven budgeting.
So, we encourage the committee to address these land mines
by, one, reforming the debt ceiling. By requiring votes to lift
the debt ceiling along with the votes for policies that would
actually increase the debt.
So, for instance, this would have required a debt ceiling
vote along with the debt increases that went along with the
recent tax cut and spending bills.
If you have to recognize the effects of the debt directly,
it would create at least more accountability and transparency,
and perhaps it would give lawmakers pause before adding to the
debt.
Another one of the ideas that we support is auto CRs or an
expedited procedures to adopt short-term CRs to avoid
shutdowns, with the understanding that you don't actually want
to be encouraging the use of CRs as a way to budget.
Finally, we also encourage allowing more option for
bipartisan deficit reducing bills to be considered, which would
encourage alternative budgets and/or consideration of broadly
supported legislation. I have been interested in what Senator
Whitehouse have been talking about on this topic and others,
but I think it is really important to create the incentives for
the things that we want to get done, bipartisanship, and the
things that are harder to get done, deficit reduction.
So, finally, perhaps the most important thing you could do
is improve the process to encourage consideration of serious
fiscal plans to improve our debt situation. No amount of
calendar changing, baseline improving, auto-CRing will be
sufficient to accomplish a serious fiscal plan and the
political will to enact that.
So, while we all recognize that budgeting is about
tradeoffs and hard choices, one merely needs to look at the
current fiscal situation of upcoming trillion dollar deficits,
projections of unprecedented debt levels, and interest being
the fastest growing part of the debt of the budget to know that
this isn't happening in our current budget. And the potential
damage could harm our country for decades.
So, to address this, we support the adoption of a system of
establishing medium-term debt target along with new enforcement
mechanisms. And in 2010, our board of experts came up with an
idea called a Debt Stabilization Act, whereby there would be a
medium-term debt-to-GDP target, annual targets to create a
glide path to get there, and the budget resolution would comply
with those targets, and both spending caps and PAYGO's would be
in place.
There would also be an additional trigger mechanism, and I
emphasize that my board thought it was really important that
trigger mechanism be half revenues, half broad-based spending
cuts to really have both sides object to it, and it would be a
mechanism that would help have budgets comply with those
targets.
There are a number of ways to structure these different
targets. At the time, we were shooting for a debt-to-GDP ratio
of 60 percent by 2018. So, we are going to have to wiggle room
that a little bit, not quite on track for that. But there are a
lot of different ways to make this mechanism work. We would be
delighted to work with people figuring out that structure.
But, frankly, just moving to a process that includes a
fiscal goal as part of the budget process would be a
significant improvement from what we currently have. And the
time to do this is right because the economy is strong; at the
same time, the fiscal situation is precarious. And
bipartisanship, which we desperately need, is at a low, but you
have the start of a really good working environment here.
So, lastly, whatever you do, we encourage you to add to
your new process stronger enforcement mechanisms because, right
now, if you look at how we try to enforce the budget with
spending caps and PAYGO, the holes in that are so large; it
really results in them being meaningless. And a budget process
that is meaningless undermines the entire faith in our system
to do the most important thing that there is for the country,
which is to set the thought-out plan for where we want to go.
So, again, thank you so much for having me here today. We
have a number of recommendations we are pleased to share with
you.
[The prepared statement of Maya MacGuineas follows:]
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Co-Chair Womack. Thank you, Ms. MacGuineas.
Mr. Capretta.
STATEMENT OF JAMES C. CAPRETTA
Mr. Capretta. Thank you, Mr. Chairman.
Thank you, also, to Mrs. Lowey. I am very pleased to be
here. Thank you for inviting me to participate.
I agree that the work of this joint committee is very, very
important. It is very timely. And so, I really am pleased that
the Congress created this committee and asked you to take a
look at these very difficult questions.
The Federal Government is running very large annual
deficits, and those deficits will grow in the future as the
U.S. population ages and health spending continues to grow more
rapidly than the economy.
The current Federal budget process is not helping Congress
grapple with this fundamental challenge. Also, it does not
facilitate an orderly and timely decision-making process.
Congress wastes too much time on small and irrelevant matters,
even as it fails to focus much attention on the issues of real
budgetary consequence.
There are many aspects that need to change. Today, we are
focused on the budget resolution. I am going to make just three
recommendations here. Although, I agree that many more things
need to be done beyond the three I am talking about today.
First, I think the budget resolution should become the
vehicle for establishing and amending the statutory caps on
discretionary spending. Second, the budget resolution should
become the vehicle by which an automatic increase in the debt
limit occurs. And, third, and most importantly, the budget
resolution should be modified so that it includes a medium- and
long-term outlook.
So, to the first recommendation on the caps. Obviously,
under the Constitution, establishing budgetary policy is a
shared responsibility between the executive and legislative
branches. This is part of our constitutional structure, which
is very important, of course, but one consequence is that we
rarely have a budget that is enforced in total across the
executive and legislative branches.
Something of an exception to this is the caps, which have
been in place since 1990, more or less, with a couple of
exceptions. These caps, while very much a part of the process
today, are not part of the regular budget process in the
Congressional Budget Act. They have been enacted on an ad hoc
basis. I think the Congressional Budget Resolution should
become the vehicle for establishing and amending those caps.
Allowing the budget resolution to become the vehicle for this
would make the budget resolution a much more serious
legislative vehicle than it is today. It would also bring the
executive branch into budget negotiations with the Congress
earlier in the year, which might help prevent the kind of end
of year political standoffs that now regularly occur.
There are a number of ways that this could be done. I think
the most straightforward is that, as a final resolution made it
both through the House and Senate, it would automatically
trigger the sending of new legislation to the President for his
signature or veto, changing the caps and statute to comply with
whatever is in the budget resolution.
The President, of course, could either veto or sign it. If
he vetoed it, then the Congress could try to override or, and
if not overridden, the caps would still apply, at least in a
budget resolution sense, to the Congress.
The second recommendation is to get rid of the debt limit.
I think the debt limit has outlived its usefulness. Congress
should get rid of it all together because it really is a self-
inflicted wound if we fail to pay our creditors. But if we
can't do that, the budget resolution should become the vehicle
for automatically raising the debt limit consistent with the
budget levels in the budget resolution. This, too, would make
the budget resolution a much more serious legislative vehicle.
It would make it meaningful as a vote because this would be the
vote that would trigger the debt limit being raised or not, and
it would bring the executive branch also into the negotiations
because of the legal questions associated with the debt limit.
Lastly, and most importantly, again, bringing a long-term
outlook to the budget resolution.
You can see the importance of a long-term outlook by
looking backwards. If we had, as a country, made changes in the
mid-1990s, as was recommended by two bipartisan panels on
budget outcomes and reforms, if we had made those changes 25
years ago, we would be in much better shape than today we are.
Similarly, we have to start making decisions now that
affect the fiscal outlook of the country in 2030 and 2035. It
takes that long to get some of these things right. And so, I
know that is a difficult task to ask people who are here to
represent the here and now and what is going on in the lives of
their constituents now, but attending to that situation is
absolutely critical. And the budget resolution really doesn't
facilitate that today.
So, my testimony covers this in more detail, but one simply
way to do this is to bring into the budget resolution an
agreed-upon measure of the Federal Government's fiscal outlook
going out the next three decades, such as a present value
calculation of expected revenue and expected spending, make
that a target for reduction over time, and use something like
the reconciliation process to bring progress on meeting that
goal.
Thank you. I will be happy to answer questions.
[The prepared statement of James C. Capretta follows:]
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Representative Womack. Thank you, sir.
Mr. Dauster.
STATEMENT OF BILL DAUSTER
Mr. Dauster. Thank you, Mr. Chairman, Chair Lowey, members
of the committee, thanks for letting me be here today.
Let me start by acknowledging the dirty little secret.
Okay, maybe it is not so secret. A lot of members hate the
budget process. I am here to tell you: It is okay to hate the
budget process. It is frustrating. It gets you blamed for
failure that you did not cause, and it is full of unnecessary
drama. But there are five things, probably more than that, but
I will talk about five things that you can do that will help us
hate the budget process less.
First, don't make it worse. Take the Hippocratic Oath of
budget reform: First, do no harm. Don't set yourself up for
more frustration and failure. Don't create a system that
punishes you when leadership fails to do its job. A good budget
process should be like your favorite car. It gets you where you
want to go. It doesn't force you to go where you don't want to
go.
Chairman Womack was right when he said that a good process
is not in the business of prescribing specific budget outcomes.
A bad budget process is sort of like an overambitious New
Year's resolution. You know, those promises that would be nice,
but we just can't keep. By February, we are denying we ever
made them. Gramm-Rudman was like that. And I would argue the
unrealistic budget control caps were as well. So, I would say
make changes that are like your favorite car and not like a New
Year's resolution.
Second, we should use Senator Bennet's term, de-weaponize
the debt limit. Senator Whitehouse is exactly right when he
said that it is like a bear trap in your bedroom. Many
Republicans and Democrats alike agree that now may be a time to
end this drama.
The Gephardt rule, which automatically changed the debt
limit when you adopted a budget resolution, should be applied
in both Houses. And if that fails, there is the McConnell rule.
That is the rule that you delegate power to the President to
suspend the debt limit for a period of time subject to a fast-
track resolution of disapproval.
Third, a lot of Senators hate the budget process and the
budget resolution, in particular, because of vote-a-rama, the
all-night vote marathon on amendments that no one has seen
before. None of us have liked pulling all-nighters since
college, and if we admit it, we didn't like it in college.
One problem is that the vote-a-rama is one way that the
minority can get its voice heard. But you can solve that by
guaranteeing that the minority leader gets a vote on a certain
number of amendments. You can haggle over the number, but it
has got to be something less than 50. After a certain number,
the press stops paying attention anyway, so why torture
yourself?
Fourth, I like the Convergence Center idea to facilitate a
budget action plan at the beginning of a new Congress. The
election cycle is the cycle that Congress pays attention to
anyway, so you should recognize that reality in the process.
I also agree with Chair Lowey, and I would not move to a 2-
year appropriations bill. Annual appropriations bills are one
of the few ways you guys have to get the Secretary of such and
such to answer your telephone call.
Fifth, I like the Convergence Center's idea to make the
chairs and ranking members of other committees, members of the
Budget Committees and for many of the same reasons that Senator
Perdue expressed here.
As spots open up on the Budget Committees, give the other
chairs and rankers a right of first refusal to join you on the
Budget Committee. If enough do, it would become a place where
deals get done. There are five suggestions. Good luck and
Godspeed in your efforts.
[The prepared statement of Bill Dauster follows:]
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Co-Chair Womack. Thank you, sir.
Mr. White.
STATEMENT OF JOSEPH WHITE
Mr. White. I hope I am doing this correctly. Distinguished
co-chairs and members of the committee, thank you for the
opportunity to share some analysis and ideas with you as you
search for useful ways to reform the congressional budget
process doing no harm along the way.
Many of the sources of complaint about current budgeting
and budget resolutions in particular, such as failure to meet
deadlines or complete parts of the procedure at all, are due
mainly to the intense political conflict of our time. And new
processes can't fix that. But I think a bit of good can be
done, and it is encouraging to see that there is some agreement
among the participants on this panel, the careful statements by
the committee leadership, and other efforts, such as the
Convergence Project.
On one issue I didn't address in my written testimony, I
would just like to say that I agree with Mr. Capretta and Mr.
Dauster and the Convergence Project that it is time to
eliminate the ways that the debt ceiling encourages hostage-
taking and brinksmanship full stop.
Any further reforms--or if you can do that one, that would
be a huge one--but any reform that would be designed to
accomplish some set of goals and sort of meet some standards,
and these standards should not consist only of beliefs about
effects on budget totals as the so much discussion seems to
think.
So, I would like to emphasize four others. First, budget
should serve representative government with democratic
accountability. They should make it easier for citizens to see
what the government is planning and promising and delivering,
and they should be affected by elections.
Second, budget processes should help policymakers encourage
efficient operation of government programs.
Third, Federal budget decisions have some effects on the
national economy so the process should encourage debate and
attempts to influence those effects. Most important, the basic
task of budgeting is to relate preferences about details to
preferences about totals. Normal budgeting proceeds in
iterations. Totals in details are proposed. If there are
mismatches, those are identified, and negotiations search for a
combination that is acceptable.
The details, such as what is done for national security or
who pays how much tax or what healthcare the government
guarantees for what cost, are in aggregate at least as
important as the economic effects of budget totals.
Top-down approaches that set totals without considering the
effects on details, therefore, are fundamentally bad budgeting.
So, by these standards, I would say there should be budget
resolutions because resolutions provide a public statement of
the economic policy based on the governing group's beliefs
about the effects of spending, revenues and their balance.
Resolutions also can trigger reconciliations, significant
changes in government priorities. But these kinds of broad
policies, broad priorities, or basic economic approach
basically reflect elections. They are unlikely to change
between elections. And by that logic, resolutions should be
biennial, functioning as the U.S. version of what OECD calls a
medium-term budget framework. There is no need to do
resolutions twice in a Congress.
The annual appropriations process, however, provides a
review of agency plans that is useful both for encouraging
efficiency and making agencies accountable to Congress and the
public.
Agency activities involve details that can change from year
to year, and there are good reasons why most organizations
budget in this sense annually. So, I would like to see
resolutions passed biennially but set 302a allocations for the
appropriations for 2 years with the appropriations remaining
annual. I think that fits the purposes of both processes.
Now, other witnesses have agreed with some of these
recommendations. And there will be a lot more disagreement over
my third point. You are receiving today and will surely receive
more recommendations that the budget process be focused on
estimated consequences for budget totals, even further in the
future than the current 10-year terms of resolutions.
I tried to explain in my written testimony why that is not
a great idea, but just a few points here. One, long-term
discretionary spending targets fundamentally ignore details.
That is why they eventually break down because you don't really
belief in the details that would fit those targets.
Two, procedures that claim to budget for the long run are
just a subject of manipulation and gimmicks as any other
procedures. As you must know from experience with evading the
BCA, discretionary caps.
Three, the dominant factor in projected long-term spending
increases is healthcare programs, but there is no good way to
estimate that cost. I provide a chart as an example of that in
my testimony.
In fact, focusing on long-term Medicare costs misses the
point, that we have a national healthcare cost crisis now and
not just in government programs.
Much more could be said about this topic, but perhaps we
can engage about that in the discussion period. Thank you very
much for the opportunity to testify.
[The prepared statement of Joseph White follows:]
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Co-Chair Womack. Thank you, Mr. White.
We appreciate the testimony of each of our witnesses here
this morning.
I will begin the Q&A with a question for Ms. MacGuineas.
Your testimony contains a lot of solid suggestions for Congress
to more effectively address long-term debt. In the current
budget process, we definitely have, at best, some tension, if
not an outright conflict, between budgeting for the short term
that leads to an annual appropriations process and then doing
something that addresses the long term without it becoming just
some fictitious goal in mind that really doesn't carry a lot of
merit. Which, if any, of the elements in our current budget
process, Ms. MacGuineas, would you keep?
Ms. MacGuineas. Well, that is an interesting question, so I
think I would shift a lot of the focus on to thinking about the
budget more comprehensively.
One of the things I don't want to do is sacrifice the long
term just to focus on the short term or vice versa. And so, I
think I would go to the very root of what budgets are for,
which is for tradeoffs, and they admit that they have
constraints, and I would hold yourselves responsible for
looking at what the glide path for the current projections are
on a regular basis.
Many times I have actually heard Members of the Congress
say, you know, there is two-thirds of the budget that we can't
even look at. And, of course, we can, it is not through the
appropriations process, but you are responsible for overseeing
the portion of mandatory spending and revenues. So, what I
would do is I would add in a piece that requires reviews of
that, and I would increase more transparency as you figure out
how to do the really hard pieces of making changes so those
have alignment, which they currently don't.
Co-Chair Womack. We have had a lot of discussion in
previous hearings about carrots and sticks. What can we do to
motivate, incentivize, coerce, shame Congress into actually
doing something?
Ms. MacGuineas. So, I think there is a couple of things
that you want to create the carrots and/or sticks for. One, of
course, is getting a budget done. And the second is for
improved fiscal outcomes.
On getting the budget done, I do find myself kind of liking
the simple idea of you shouldn't leave, you shouldn't have a
recess until the budget is completed. I know people want
carrots, so I figured we can just make that a carrot instead of
a stick, which you get recess when you've done the budget. We
can just flip it.
But I do think in terms of the long term, there are lot of
things you can do with the debt ceiling where you replace that
with a different form of budget constraints, something that
only comes into play when you are spending and revenue programs
in the longer term are out of whack. So, you would not have to
have debt targets, debt ceilings, other kinds of constraints,
unless they are there to remind you that changes need to be
made. And avoiding them, I assume, would be a carrot.
Co-Chair Womack. Mr. Capretta, some observers have noted
the challenge of focusing on medium and long-term fiscal
outlooks. At the same time, the unfunded liabilities of the
Federal Government, depending on who you ask, are at least in
the tens of trillions, if not into the hundreds of trillions of
dollars.
So, help me understand why in spite of the challenges,
Congress should attempt to build in a longer term focus as part
of the budget resolution and do so in a politically neutral
way?
Mr. Capretta. Well, it is quite true that projecting out
Federal outcomes, 15, 20, 30, 40 years from now is very
difficult to do, but there is little question that the
population aging of this country, plus the commitments that
have been made in programs relative to the revenue base has
left the country with a very, very large gap.
And, you know, we can argue about degrees and how much, but
it is going to be very, very significant. I would also note
that many other countries have adopted some kind of a long-term
focus because they understand this problem. Many countries,
frankly, advanced economies have taken much more proactive
steps than we have to try to get this under control in advance
of it occurring because it is, for them, maybe accelerated some
because of their demographic questions.
So, there is no question that we have a big unfunded
liability problem. How are we going to deal with it? If we
don't make some changes in the processes that are pushing the
Congress to address it, and the President to address it, there
is very little reason to do anything.
The Congress could drift on for another 10 or 15 years
without anybody even realizing how big the problem is and, you
know, until it is almost on top of us. And so, I think much
more focus needs to be brought to Congress on how big it is and
what needs to be done now to try to affect outcomes in 10 and
15 and 20 years.
You cannot change this problem with a small, you know,
adjustment, and, you know, turn around and expect it to, you
know, be implemented right away. You are going to have to do
big things, and that means, you know, things that are going to
take a long time to phase in.
Co-Chair Womack. I am about out of time. I was going to
share some of my new Year's resolution with Mr. Dauster, but
since I have broken all of them anyway, we will just save that
for another day.
Mr. Dauster. I broke mine as well.
Co-Chair Womack. I do like the comparison, though, to our
business and breaking New Year's resolution.
Mr. Dauster. Thank you, sir.
Co-Chair Womack. Mrs. Lowey.
Co-Chair Lowey. For whoever cares to respond regarding
budget resolutions. In the past, the budget resolution has been
a powerful tool for creating, implementing, and enforcing
budget plans, but that only works if there really is actual
agreement on a plan. And recently, budget resolutions seem to
be becoming more vague with little real purpose other than to
launch reconciliation bills and sometimes attempt to show
declining deficits on paper.
Would any of you like to comment on how budget resolutions
can be made more real again?
Mr. Dauster. Well, I will start by saying that I do with
the Convergence Center idea that it makes sense to set those
overall appropriations levels early on in a Congress. And I try
to encourage that to happen by making it sort of a disappearing
fast track. You get the fast track if you can do that at the
beginning of the Congress where it is useful to the
appropriators, but you lose that, say, in April or May of the
first year. If you don't do it by then, you don't get the fast
track reward that you would have otherwise.
Mr. Capretta. I would also just suggest that the
recommendation I made in my testimony that said that you should
tie the statutory caps on discretionary spending, on
appropriated spending to the levels that go--that are in a
budget resolution and send legislation to the President for
signature or veto on those caps, it would make the budget
resolution the vehicle by which the annual appropriation caps
are set for both the Congress and the President. That would be
a real legislative item, and it wouldn't be fictitious.
If it was signed, you know, that would be, everybody would
be signing on, you know, subject to loopholes and trying to get
around it through some practices that need to be stopped. But,
you know, caps on discretionary spending have generally, not
always, but generally worked over the last 25 years.
And if you put them into the budget resolution, the budget
resolution becomes more real for both the Congress and the
President.
Ms. MacGuineas. I would point out that reconciliation is an
incredibly powerful tool. And I think that it should be changed
back to the original intent so reconciliation can be used for
things that improve the deficit situation, not used in other
ways. And I also think that budgets should be pushed back to
where they are taken seriously, and they are meant to be
serious, and not just political documents where the numbers
don't add up.
And ways to consider doing that is that if you have savings
in your budget, you need to put them into reconciliations. You
need to direct for them to have reconciliation to move those
savings along so that they aren't just put there on paper and
never used. And ending the amount of gimmicks that we have on
these budgets, so there are heroic assumptions. There are
timing changes. There are all sorts of spending that is assumed
to bypass the caps, but plugging up those gimmicks would be one
important tool in showing that budgets need to be taken
seriously. And they are at the point now where they aren't at
all.
Mr. White. If I may, just a few points. One is that the
original purpose of the reconciliation process in the original
budget resolution was not simply to reduce deficits. There was
disagreement about that. I am not saying that, at this point,
given the current situation, I wouldn't support that, but
sometimes, for example, you want an expansive fiscal policy, or
you might want an expansive fiscal policy. And one of the
original ideas was that reconciliation could be used for that.
So we shouldn't talk about original intent here.
I also think, I think the most ridiculous thing that is
being done with reconciliations right now is the use of these
$1 billion reconciliation instructions, which are ways to
basically get around the Senate filibuster without actually
having any fiscal policy or any policy involved. And so, if
there is a way to ban these $1 billion reconciliations, I think
that would be a good idea.
The other thing I would like to emphasize is that it sounds
nice to say that there should be agreement between--that the
President should sign off on the budget resolution, but the
budget resolution process was originally created in part
because, you know, President Nixon and the Congress at the time
did not agree on basic fiscal policy.
And I have a hard time imagining what the budget resolution
produced by Speaker Ryan would have been that President Obama
would have signed. And so, I think it probably is better to
view the budget resolution as something for Congress. Getting
the House and Senate to agree is tough enough.
Co-Chair Lowey. I misunderstood. I thought, in your last
response, you were suggesting that the President get involved.
I guess I misunderstood. I can't imagine bringing the President
into the budget process now. We have enough trouble when we
finish our work, but that is not here nor there. Did I
misunderstand you? It seems your first----
Mr. White. No, no, no. I think it is very optimistic to
recommend, as the Convergence project does and as other people
have, that the budget resolution be some sort of joint
resolution that the President signs. I think that is going to
be very, very tough.
Co-Chair Lowey. Oh, we agree that it would be very, very,
very, very tough.
Mr. White. It would be great if you could get agreement,
but I am not sure you can have a process that forces that.
Co-Chair Lowey. Okay. I just wanted to be sure that I
didn't misunderstand.
Mr. White. Sorry.
Co-Chair Lowey. Thank you very much.
Co-Chair Womack. Representative Arrington.
Representative Arrington. Thank you, Mr. Chairman.
I must say, I find this panel, so far, the most helpful and
most practical and most specific in getting at what I hope we
can all agree to with specific strategies for a more timely,
orderly process. And if we can be aspirational, I would like to
get at some ways to improve getting to better outcomes, not
necessarily--in a policy-neutral way.
I think, let me start with the reconciliation process
because it has come up. You say we shouldn't use the
reconciliation for these $1 billion--and I agree, actually. I
mean, I voted for the tax reform because I think we have got to
grow the economy. And I think that is part of it. And I think
we are going to more than cover the cost there, but,
regardless, I don't think that that is necessarily the intent
or a good pattern to enter in to.
Why don't we use reconciliation for its intended purpose?
And I will open that up to any of you. Why don't we use that
for its intended purpose more often given that we are $21
trillion and counting?
Mr. Dauster. I think of the reconciliation bill from the
Senate standpoint. And from a Senate perspective,
reconciliation is a way to get a majority vote on something
when the normal rule in the Senate is that you need 60 votes to
go to the bathroom. So, it could be, it could be used for a lot
more things than it is.
But in the end, it ends, as you have said in earlier
committee hearings, it often relies on the political will if it
isn't there to put together the costly difficult things that
you would have to put in the reconciliation.
Representative Arrington. So, if that is the way to get at
the 70 percent of the spend that we know is one part of the
equation here to reduce deficit spending and debt and if we
know that there are some really big programs within the
mandatory side, why don't we use that reconciliation more
often, Ms. MacGuineas?
Ms. MacGuineas. Well, I think the problem is that what
happens is to use that reconciliation usually means it is going
to be one party that uses it, just by passing the 60 in the
Senate. And for big fiscal improvements, you are going to need
both parties to buy in. There is no way that we are going to
get real deals, real progress, real improvements with one party
owning all the hard choices.
Representative Arrington. We couldn't even get the
Republican Party on a simple majority to agree to $204 billion
reduction using reconciliation during the tax reform. I don't
know how in the world we are going to get--we have people in my
party that won't even mention the word Social Security or
Medicare when it comes to reconciliation.
I mean, there are all kinds of ways to say it to avoid
people thinking you are trying to take their Social Security;
you know, making it more sustainable for my generation and all
that. But I mean, isn't it always going to come back to, will
we have the guts to actually take on some things that we know
are going to send us into oblivion, into the debt crisis that
will wreak havoc on generations to come, blah, blah, blah? I
mean, please.
Mr. Capretta. If I could just say one thing about
reconciliation, which I think has been lost over the years,
which is that it was quite true that it is used mainly to get a
majority vote in the Senate these days. But in the eighties,
because there was split government between--you had a
Republican President and a Republican Senate and a Democratic
House, it had to be bipartisan, and the theory of the Reagan
Administration, why they pushed for reconciliation to be used
frequently during that period, was you ended up with one vote
where there was some positive thing a Member might be able to
say about it as opposed to all the individual items. You could
claim: Hey, if we pass this bill, it will reduce the deficit by
$300 billion, $400 billion.
And that was the impetus to try to put it all together into
one package and say Congress was taking a very important step
to reduce the deficit.
You are never going to get deficit reduction of that
magnitude if you try to pass a lot of little individual bills.
They all get mired down in political controversy, and every
committee wants to be budget-neutral. So that is really the
main purpose of reconciliation.
Representative Arrington. Each of you have mentioned the
debt targets. I am all for that. I think it is policy-neutral,
Mr. Chairman, as to how you get at the outcome. But I think
having a glide path to something more responsible, how do we
put teeth into that to make sure that whatever the strategy, we
walk it back to a responsible level? And I yield back.
Co-Chair Womack. Senator Whitehouse.
Senator Whitehouse. Thank you, Chairman. I was struck by
Chairman Womack's opening statement regarding the disinterest
that we all see in the budget resolution. And I think one of
the reasons for that is that the question, the budget
resolution to what end, hasn't been answered.
If the purpose is to create a reconciliation bill that is
not even relevant to the fiscal task of the Budget Committee,
which it has become recently--and it is hard to get too excited
about that unless you are the proponent of the measure that is
being driven through the reconciliation process--if you are
doing budget resolution without a strategy or a timeline or a
goal, it is hard to get excited about that as well. And I
appreciate very much Mr. Capretta's focus on a target and
getting there over time, because I think that is an important
part of any serious budget fiscal process.
It is also hard to get excited about a budget resolution
where you don't even get the arithmetic right and add the
elements that add to the deficit and the debt, which are
revenue, appropriated spending, health spending, and tax
spending. And if we are not looking at all of them, we are not
even getting the arithmetic right.
And, finally, if the budget resolution doesn't help the
appropriators get their 302s and it doesn't help solve the debt
limit problem, again, it is hard to get too excited about it.
So, I think that gives us an array of tasks that can make
the budget process meaningful again. And I want to particularly
focus in my questioning on the debt ceiling because I think you
have all been really excellent on that subject.
As Bill Dauster was kind enough to point out, I view this
as a zero-upside bear trap in the bedroom. Worst-case scenario,
you step in the damn thing, and bam, now you have got a hell of
a problem on your hands. Best-case scenario, you avoid it, and
nothing good has been accomplished. That is not a really good
equation.
Bill, you have looked at this for some time. You have a lot
of experience in the Senate. Can you think of one good thing in
your experience that was accomplished in the Senate by virtue
of the debt ceiling? Some people say it is an opportunity to,
like, give the minority a chance to hold the majority's feet to
the fire, demand something. Has that actually ever happened?
Mr. Dauster. I am not going to be able to find that
example. And, in fact, I think that you are right about, and
many of you have expressed the concern with the debt ceiling.
We carry around in our pockets little pieces of paper like this
that are basically just promises based on the promise that the
government is going to do what it says it is going to do in the
budget process.
Senator Whitehouse. Let the record reflect he is showing a
dollar bill.
Mr. Dauster. It could have been, though, a Treasury bill, a
Treasury bond. If we have pieces of paper like that, we sell
them for real money, real things of value in the world. But if
we mess up the debt limit, then we have to pay people more in
order to borrow from them by giving them little pieces of
paper.
So, whenever we do debt limit crises, we put in danger the
whole system that relies on little pieces of paper like this.
Senator Whitehouse. Let me ask you if you could get back to
me in a response to a question for the record because I don't
think we have the time to really drill into this now. But as I
think my House colleagues will be first to recognize, the
Senate is a peculiar place, and----
Mr. Dauster. We will stipulate----
Senator Whitehouse. And I think your idea about using the
budget process to, quote, ``automatically change the debt
limit,'' I think makes a lot of sense. But I think it would be
helpful to us if you brought your experience in the Senate,
with its procedures and with its parliamentary rules and so
forth, to drill down through that automatically changed concept
and see what kind of language you might, perhaps, even run by
the Parliamentarian, and see how we would actually do that.
I think that is a really good concept. And I think one of
the things that makes the budget resolution relevant again is
if it does move the debt limit so you don't have that bear trap
waiting out there for you.
But as you know, the Senate is a peculiar place, and if you
could drill through to that, that would be, I think, very
valuable for all of us.
Mr. Dauster. I am happy to do so, sir.
Senator Whitehouse. And to go back to Mr. Capretta's
statement. You talked about setting a target for debt and
deficit reduction over time. My observation has been that the
current budget process, at least in the Senate, doesn't do
that. There is no point in that process. We are asked to set
what the target is. And I think every witness so far has agreed
that the target is a debt-to-GDP ratio. Whatever the number is,
that is the metric for it. And we are not asked that in the
budget process at any point. And given that we are looking at
$21 trillion, as Congressman Arrington said, we are not going
to do that overnight. So there has to be a glide slope to get
there, and presumably, there also has to be warning bells to
let us know when we are off course.
Is that the general concept that you had in mind about a
target and over time?
Mr. Capretta. It is generally. I would support that as a
way of doing the business. I would also look at, potentially,
present value calculation. That would be another way of
bringing it down to one number that the public might be able to
understand. Just have CBO----
Senator Whitehouse. Or you do both.
Mr. Capretta. You could do both.
Senator Whitehouse. So, you can't game it so much.
Mr. Capretta. Yeah. That is----
Senator Whitehouse. Does everybody agree that debt-to-GDP
is the metric that we should be looking at in terms of----
Mr. Dauster. I would quibble on two grounds, if you will
forgive me. One is----
Senator Whitehouse. I am out of time, so keep it brief,
Bill. I yield back.
Mr. Dauster. You should be looking at the rate of change,
not just the stock. So, deficits are just as important. Where
you are going is important. And why you are going is important.
If you had a high debt-to-GDP ratio and you are fighting
Hitler, that is okay. But if you are not doing something
important, then it is not.
Senator Whitehouse. Got it.
Co-Chair Womack. Mr. Sessions, Texas.
Representative Sessions. Thank you. I want to ask a
different question. 2011, 2012, 2013, 2014, 2015, 2016, we went
through in this body and in the Senate, a process that
essentially was CRs and essentially held discretionary spending
flat. It produced a flat budget. It held government to making
decisions, in my opinion, based on priorities. It refocused
administration agencies, and it made them dig deep, in my
opinion.
It also caused, on the other side, some indecision about
infrastructure decisions that we would make and deferred lots
of decisions. So, some, I think, was good. Some, I think was
deferred. What do you think?
Ms. MacGuineas?
Ms. MacGuineas. So, I thought the purpose of the spending
caps would have been, would have been most effective if what it
had done was pushed lawmakers to replace them with more
thoughtful targeted changes to the budget that would have
improved the fiscal situation. I thought the caps were the
easiest thing to do because you don't have to specify what the
savings are, and so it sounds like you are doing a lot work,
but you are not picking the policies. There were some savings
that were smart. There were some savings that were excessive.
Now that we have gotten rid of the caps, and what we should
have done is when we busted through those caps, replaced them
with savings elsewhere, we no longer have that spending
constraint. But we also have the problem where discretionary
spending, which really hadn't been the driving problem in the
budget before is about to be a big significant problem again.
So, I would pick reasonable spending caps along with pay-
as-you go rules. Reasonable meaning they are built from
policies that you can stick to and you plan to stick to. But
this time I would include the full part of the budget, not the
part of the budget which at the time was the least, the least
of the drivers of the debt.
Representative Sessions. A hungry person will gorge
themselves. A person that eats consistently may be able to
offer some bit of disciplined in their eating and sleeping
Ms. MacGuineas. That is right. You want budgeting
constraint that is realistic. We want budgets that are
realistic, and we want enforcement mechanisms that are
realistic. And once we have things that are on paper add up to
huge aggressive claims that we are never going to get, the
whole process becomes impossible to stick by, and then there is
no credibility to it.
Representative Sessions. Mr. Capretta.
Mr. Capretta. I think that the discretionary caps were
useful for trying to drive a lot of productivity improvement in
certain ways. I think they became counterproductive to some
degree with respect to the defense budget. I think that there
is pretty clear evidence that, you know, if you just look at
defense over the nineties and to where we are today, given the
security questions going on, it seems like it is not going to
work to have the levels that were there previously. And so,
something was going to have to give. And when you gave on that,
you ended up giving on the other side as well. So that, I
think, was the basic equation.
Discretionary spending isn't necessarily the fundamental
problem. There is lots of waste in it. It is very hard to
target the waste. I think one idea that should be given more
consideration is delegating to the agencies that are running
these programs some more incentives to drive productivity
improvements in their agencies so that they make the decisions
to cut spending so that they can then spend the savings on
bigger investments that they can find.
So, you know, new models of running the agencies is
probably a better answer than just blunt across-the-board
cutting.
Representative Sessions. I am not trying to give the answer
for you, but I was out in Hawaii several years ago and met
General Brown, United States Army, who spent a good bit of time
trying to convince us that sequester was a difficult issue for
the military. And I took 1 minute to suggest to him that I
thought that the levels were fine, and we needed to give it to
them October the 1st instead of March the 20th. And he got his
head around that.
So, I am not saying the answer I expected from you, but I
think timeliness is the most important aspect to run the
government.
Sir?
Mr. Dauster. I agree with a lot of what you just said and
what the other witnesses have said. Make it early so that the
appropriators can react to it and the government can react to.
Make it rational and achievable, or else people will blow
through it. But setting a cap is one of the best ways to get
the agency to focus on achieving at savings.
Representative Sessions. I think, no matter what the level
is, timeframe of efficiency, of giving the government time to
effectively take whatever they are is important knowing we
probably won't go back, but they have got--meaning how much
money, we probably won't take back a lot of money, but giving
them time to effectively do it.
Sir?
Mr. White. If I may, there is a lot that could be said
here, but I just want to emphasize that we should not assume
that there is a lot of productivity that can be pulled out of
our programs. It is not clear to me, for example, that the
effect on the Social Security Administration of the kind of
budget constraints it has faced is something that could have
been solved by greater productivity.
So, I think we have to be very careful about making these
assumptions in any part of the budget.
Representative Sessions. Well, I think you could just look
to the VA. That would be exhibit A, to me, with the size. Thank
you very much.
Thank you, Mr. Chairman.
Co-Chair Womack. Mr. Yarmuth of Kentucky.
Representative Yarmuth. Thank you very much, Mr. Chairman.
Thanks to all the witnesses. I have found the discussions
very interesting, as all our discussions have been interesting.
I want to focus a little bit on the issue of long-term
budgeting. It seems to me that three of the four witnesses have
said we should be doing that, and Mr. White takes a contrary
position. I remember several years ago when Tim Geithner was
the Secretary of the Treasury, and he came before the
committee. And Paul Ryan was then chairman and had all of these
40-, 50-year projections of expenses and so forth and
increasing the deficits.
And I asked Secretary Geithner, you know, how realistic do
you think 40- and 50-year projections in a world that is
changing as rapidly as this one is?
And he said: I don't think projections outside of 5 years
are worth anything.
So, would you elaborate, Mr. White, on what your opinion is
on the perils of longer term budgeting, and what you think may
be a realistic timeframe that is viable and meaningful?
Mr. White. Sure. It varies somewhat with the program. And
you can do a better long-term focus for a pension program than
you can for a healthcare program.
Healthcare cost control is simply a year to year problem
because the entitlement to healthcare is not simply to the
beneficiaries. The reason our care is so expensive is we pay so
much for everything we get.
In other words, the providers are getting much more money
here than in any other country, or the overhead expenses are
much more than in any other country.
And these are powerful important people who, if you try to
reduce their incomes, they will fight you. And you cannot
budget in the long run to control the costs that the medical
community will generate because there are just no policies that
will do that. So, healthcare cost control is a short-term
problem. And it is problem for the whole country, not just for
the government. And we really need to do much better on that.
And that is the most important thing we could do for the
long run of the Federal budget. If we got our healthcare costs
down to something resembling the most expensive other country
in the world, our long-term forecast would look a lot better.
So, one, some programs are different from other programs.
Social Security is different from Medicare and Medicaid. Beyond
that, I think anything more than 2 years is probably a bad idea
for discretionary spending because there is no--first of all,
there is no good way to do the baseline. What is the baseline
from which you start?
The CBO baseline is usually, well, increased with
inflation, but for some programs, that may be too much, but for
a lot, it is too little. The population grows. You are serving
more people. And so, I don't think there is any really good way
to do long term.
And I think that the most important thing you could do
about the long term is get better control of the American
healthcare system now.
Representative Yarmuth. You also, in your written
testimony, talk about the point that budgeting should be more
about just aggregate totals of spending and revenue, that it
has to be more about the policies that are reflected. And I
totally agree with that. The American people deserve to know
what policies will underlie the allocations that we are making.
And I remember so well, Mick Mulvaney coming before the
committee earlier this year. And he said: I could have come up
with a balanced budget, but we would have been making stuff up.
We would have been basically fabricating policy.
And in prior Congresses, they have done the same. You
arrive at a number, and then you say: Well, details are to be
determined.
What kind of details in terms of policies in the budget
resolution do you think are appropriate?
Mr. White. Well, I think that this obviously raises the
question of which committees are going to make decisions about
details. I think in the past when reconciliation has been used
to reduce the deficit, which hasn't happened for a while, but
when it did, what actually happened is that the leaders of the
committee, such as Senator Dole in particular, told the
leadership of the Budget Committee and so on: Hey, I think we
can do this much. We have ideas about how we will do this much.
I think it is in practice that there should be consultation
with the leaders of the authorizing committees about: What do
you think you can do this year? How much can you do? No, we
need more.
And, again, it is iterative.
I don't think the budget resolution should specify the
policy details. I think that the budget resolution, however,
should be based on careful consultation about what details
might work, about what totals might work.
Finance Committee, what can you do here? Ways and means,
what can you do here?
And the budget process can push, the Budget Committee can
push, and say: Hey, how about some of this?
But that is all before the resolutions are adopted.
Representative Yarmuth. Thank you.
I yield back.
Co-Chair Womack. Senator Ernst.
Senator Ernst. Thank you, Mr. Chair.
And thank you to our witnesses today. It has really--I
agree with Congressman Arrington--this has been a very, very
helpful discussion and debate this morning.
I would like to start just by going back to having the
budget as a joint resolution signed into law. And I know, Mr.
White, you have expressed great concern there. It would be very
difficult. But if the panel could go back and maybe, from your
perspective, why would a--because a lot of our witnesses have
brought this up in other meetings as well.
But from your perspective, what would be a positive to
having a joint resolution signed into law, and what might be
the negatives of that same proposal?
Jim, if you would like to start?
Mr. Capretta. Yes. Back to the recommendation I made in my
testimony. First of all, the recommendation I made was just to
make the budget resolution the vehicle for spinning off a piece
of legislation that would go to the President, that would amend
the caps on discretionary spending.
Mr. Capretta. So, it wouldn't be covering everything that
would be going on in the budget resolution. I actually in the
past have favored that. That may be a step too far for this
committee to take, so let's just focus on the recommendation I
had in my testimony today.
If you put into the budget resolution the option that, at
the end of it, if it was approved by Congress, a separate bill
would go to the President, and he could sign or veto it, and it
would change the caps on discretionary spending, this would get
around the problem of a fake budget resolution, because the
resolution would be setting caps that everybody would have to
live with.
And these would be the real caps. They wouldn't be the fake
caps with $40 billion in reductions that nobody planned to
actually enact.
So that is one very big positive, I think, that this would
become a real vehicle for really setting the caps, and it would
be the caps that the President would also have to live with. He
wouldn't be signing on to anything else.
Now, some people have said, well, why do we want to bring
the President into the budget. The President is in the budget
process. The President, at the end of the day, is going to be
in agreement or in disagreement around the total amount of
discretionary spending. They will weigh in on that one way or
another before the process is out. If you can get agreement on
that earlier in the year, you are better off than later.
Now, I am not guaranteeing this would lead to agreement
right away. This could mean protracted negotiations like
everything else. It could go on for months. But it would become
a vehicle for trying to get that debate going.
And by the way, if the President vetoed it, Congress would
just go on like it already does. So, you wouldn't really lose
anything by doing this.
Senator Ernst. Yes, Joe.
Mr. White. If I may, Senator, but that raises the question:
What is the period of the caps?
If the period of the caps is, say, 5 years, then next time
it is time for a budget resolution, hey, we already have some
caps. We don't need to enact a resolution to have caps because
we already have caps.
So, there might be an argument for, if you go to a biennial
budget resolution, for having 2-year caps, and I think that
would be responsible in terms of relating totals to details.
But if the caps are for longer than that, then the argument
that it is an incentive to pass a budget resolution no longer
becomes true.
Senator Ernst. Maya.
Ms. MacGuineas. So, I think it is a perfect example of how
there are pros and cons in all of these policies, instead of
that it is just one simple answer. And I think Doug Holtz-Eakin
testified before in a way that made it really clear and
helpful.
The benefit of is right now the budget doesn't have the
force of law. It would be desirable if it did, it would be more
meaningful, and it would strengthen the budget in guiding the
entire process.
The problem is how you feel about giving the President more
power than he already has, because Congress should be able to
take some of its power.
And then I think the real issue is, where do you want those
hard choices to come. Should they come at the beginning of the
process, which they probably should, which is why I would, if I
had to choose, go for a joint budget resolution, but it could
make getting the process started much easier.
And you want to have a backup plan so that if you can't
come to agreement, you can still have revenue and spending
levels that you can move forward with.
Senator Ernst. Very good. I appreciate that.
I have got less than a minute left, but I want to quick ask
you, Ms. MacGuineas about, you mentioned mandatory versus the
discretionary spending and greater transparency, having a look
at mandatory spending at some point during that budgetary
cycle. How would you envision that?
Ms. MacGuineas. Yeah. Well, I absolutely think that you do
need to budget in the longer term, you need to make projections
and look at things in the longer term if you are going to make
commitments for the longer term, which we do in programs like
Social Security and Medicare. And there are a lot of important
things that we need to be predicting going forward over the
longer term, like things that are driven by demographics.
So, the first key is absolutely increased transparency. We
have very good work on this from the trustees of Social
Security and Medicare, but having other ways that we really put
forth the projections that these plans are on.
Then the next step would be coming up with actual--if your
programs are out of alignment, if we are making promises that
we aren't able to keep, which we are doing right now, there
would be some action-forcing mechanism where you would start to
grapple with those.
It would, as we have said throughout this hearing, be
policy-neutral. It has nothing do with how you would fix these
programs. It would be that we should no longer be able to
abdicate the responsibility to look at programs where we are
making promises without a plan for how to pay for them, and
making changes to them sooner rather than later would
beneficial.
Senator Ernst. Thank you.
I apologize, Chair. I yield back.
Co-Chair Womack. Ms. Roybal-Allard.
Representative Roybal-Allard. Thanks, Mr. Chairman.
I want to ask a little bit different kind of question to
see whether or not this fits into the equation as to what we
are trying to do.
You know, it is been mentioned that the congressional
budgeting math doesn't match up with reality, that we should be
looking at projecting outcomes further out to see what the
impact is of our decisions, immediate decisions are, and how it
impacts us in the future.
And it was also mentioned that we had better get better
control of our healthcare system, because that is something
that is also contributing to our deficits now and in the
future.
The thing I am asking about is how we score things, for
example, in terms of healthcare, the fact that we cannot score
certain policies. And I will use healthcare as an example.
For example, prevention, when the information we get says
that if we invest in prevention, for every dollar that is
saved, we eventually will save $12, sometimes $24. I don't
remember the exact number. And so, because it is not scorable,
at least that is what we are told all the time, we do more
treatment policy rather than prevention policy.
And so, I guess my question is, in terms of scoring, is
there anything that you think could be done in terms of scoring
so that the savings that we could realize, if we were able to
invest more in prevention, would become a reality?
Because right now every time we want to invest in
prevention, we are told: No, we can't do this because it can't
be scored and it breaks the budget caps or it goes beyond
whatever restraints that we have.
So, my question is about the scoring, if something can be
done to include long-term savings.
Mr. White. If I may, there are two issues here.
One is the boundaries between discretionary and mandatory
spending. So, if you increase discretionary spending this year,
the question is, that runs up against the caps in discretionary
spending. And yet, it is budgetarily sort of silly to let the
caps stop you from doing that if it, in fact, will save you
money on Medicare and Medicaid and so on down the road.
And that would require some sort of changes in the rules so
that mandatory savings, as scored by CBO, would be allowed as
offsets against discretionary spending. You could do that by
the rules within the caps.
But there is a second issue, which is whether prevention
actually saves money. And most of the time, CBO does not score
prevention as saving money because most of the time it actually
doesn't. The advocates will say it will, but finding data that
actually supports that for most prevention measures turns out
to be very difficult.
And this goes back to Louise Russell's book 30 years ago
on: Is prevention cheaper than cure? And prevention may, in
fact, help, you may get healthier people from it, but most of
the time CBO won't score it because they don't have the
evidence to score it.
So, there are those two different issues.
Representative Roybal-Allard. Ms. MacGuineas, in your
testimony you say that Social Security deserves a place in the
budget process. And as you know, any time we mention doing
anything with Social Security it raises a lot of red flags for
a lot of different reasons.
So, can you please elaborate a little bit on how you think
Social Security should fit into the budget process? And how
could we avoid some of the pitfalls that so many see whenever
we even talk about Social Security in any way?
Ms. MacGuineas. Yeah. Let me first agree and empathize that
having a discussion, a national discussion about Social
Security, is incredibly difficult because it becomes demagogued
immediately, and you quickly move away from what the actuaries
tell us to sort of threats of people trying to harm seniors or
do this and that.
That is about a national discussion. We are not having very
good national discussions on a lot of things right now, and we
need to change that tone and that tenor and the way that we
talk about things. And that is why I do believe things like the
trustees of Social Security, CBO, impartial arbiters, are
really critical in all of these discussions.
The reason I think Social Security needs to be a part of
the budget, and, again, policy-neutral, we can fix Social
Security all by revenue increases. We can fix it all by
spending reductions. We can do it with a combination. It is not
about how you fix it. It is that we have made promises that we
are unable to pay right now. So, we do want to think about
that.
But it is also the point that budgets are about resources
and how we are going to allocate them. And it is really
important that, at some step, and that step should be the
budget, we look at all of our resources in total, how they are
allocated in the budget pie, and ask ourselves the question:
Does that reflect our national priorities?
And in most cases, I am sure it probably will, and that is
a good thing. But we should not take pieces, big pieces of the
budget off and say we are not going to look at them, because
budgets can't look at the whole picture unless you understand
all our tax dollars, where they are going, what the tradeoffs
are.
Everything with Social Security is controversial, but this
shouldn't be. This is just a basic principle of how one should
budget. And, again, it has nothing to do with outcomes. But we
should fix the program. It has nothing to do with directing how
we should.
Representative Roybal-Allard. Okay. Thank you.
Co-Chair Womack. Mr. Woodall.
Representative Woodall. Thank you, Mr. Chairman.
I agree with Ms. MacGuineas, everything with Social
Security is controversial. But I suspect, now that more than
half of the Congress got here when I did in 2011, or more
recently, not a one of us has been asked a question about the
1983 Social Security amendments. Not a one of us has been
grilled over the increase in payroll taxes. Not a one of us has
been grilled about the reduction in benefits.
To Mr. Capretta's point, we did something that was going to
take place 30 years later. We phased it in over a large period
of time. And we all knew that, born in 1970, I am not going to
get my Social Security benefits until 67 instead of 65.
And I am vexed about how, to Mr. Dauster's point, how we
get folks to focus that far out on the horizon. But I know it
would require a reconstitution of the budget committee process.
So many State legislatures, the budget committee, the
appropriations committee, same committee. And so, I understand
some of the recommendations for getting the President involved.
Today it actually is pretty clear to me that we are
performing three separate functions. I am doing aspirational
goals in a budget to tell my bosses back home what I would do
if only I were king for a day, which I am not.
Then I do an authorization process to say: Just so you
know, we can all work together, and these are all the things we
would do for you if we had the money to do it, which we don't.
And then I come along once a year and say: This is actually
what I am going to fund, but don't forget about the really good
authorizations I did for you and the really good budget that I
passed for you earlier.
And so, I don't think we can reject that political reality
that those things play a role.
So, I want to focus on appropriations, because that is
where the rubber meets the road every year. And I have a letter
from the CBO where they talked about how the fiscal year 2017
appropriations were being spent.
And, Mr. Chairman, I would like to ask unanimous consent to
put this in the record.
Co-Chair Womack. Without objection.
[The information follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Representative Woodall. What the CBO was asked is: What is
that spend rate? Because we really do want to hold folks
accountable. I think it was Mr. Dauster who said this is the
only way I can get the administration to come back and visit
with Congress day in and day out.
And what the CBO found in this report--and I apologize if
my colleagues don't have a copy of it--is that about half the
money did go out in year one, but the other half of the money
went out in year two, or year three, or had absolutely no time
limit on it whatsoever, just went out whenever.
So, my question for each of you in the 2-1/2 minutes I have
left is, knowing that the spend rate is different, that folks
are spending annual appropriations over many years out into the
future, and knowing that that number is actually 50 percent of
the money that is going out not in year one, does it change
your expectation of what keeps the administration coming back
to Congress?
I want to stipulate that Article I is who I want to
protect. Could I really move to biennial or triennial or some
different cycle, given the spend rates that we see in
appropriations today?
Mr. Dauster.
Mr. Dauster. I think that is an argument for annually
appropriating, because then you go back and you see are you
spending it where it needs to go. And if you aren't, then you
can grab some of it back and use it somewhere else.
Mr. Woodall. Now, I can only grab it back if I have an
appropriate President who is willing to work with me on a
rescissions bill. And if I have a President who is willing to
work with me on a rescissions bill, then I don't need the club
of appropriations to get the agency to come back and visit with
me, is my expectation. So, I am thinking this is an adversarial
situation that comes up most often.
Mr. White.
Mr. White. Well, I think what we are talking about here at
some level is the difference between budget authority and
outlays. And so, when Gramm-Rudman was passed, which focused on
outlays, they had to have this massive negotiation among CBO
and OMB staff to come up with spend-out rates for every
program, project, and activity.
Because if you are going to buy an aircraft carrier, it is
going to take a very long time to spend the money for an
aircraft carrier. And if you are going to build a road, again,
you don't spend all the money on the road that year.
On the other hand, there are things for which you spend
money immediately, or it is sent out this year for next year,
like support for education.
And so most of what is going on in this situation is just
the natural differences among types of programs. And I don't
think that that will really have much effect on what you are--
--
Representative Woodall. Well, from an accountability
perspective, my experience with the Department of the Navy is
they are very interested in what I have to say when we are
talking about buying that aircraft carrier. Once we have half
an aircraft carrier, they are pretty sure we are going to get
that second half down the road. The military contractors are
pretty sure they are going to get that second half, too.
So, I know we are all worried about what happens with the
appropriations cycle. I am just not an appropriator, trying to
understand how that mechanics work.
Mr. White. Well, I think that they are worried about
getting the budget authority in the first place. And if they
get the budget authority for the aircraft carrier and they
screw it up, then maybe there is a possibility you won't give
them another aircraft carrier.
Representative Woodall. I see my time has expired, Mr.
Chairman. I yield back.
Co-Chair Womack. Mr. Kilmer.
Representative Kilmer. Thank you, Chairman.
And thanks to all of you for being with us.
You know, there is a lot of conversation about carrots and
sticks. And, Mr. Dauster, I wanted to get a sense from you
regarding what sort of positive incentives could be put in
place to encourage bipartisanship and sound budgeting. You
raised the notion of a fast track, and I am not entirely clear
what that looks like.
I guess I can see how you could create an incentive in the
Senate to act in a bipartisan way if it gets around vote-a-rama
and filibusters and all that. But why would a majority in the
House be incentivized to go that route when they can do
whatever they want with 218 votes?
Mr. Dauster. I should say that I pray every morning for
humility and sometimes it takes. So, I should say that I am not
an expert on House procedures and I shouldn't pretend to be.
I want to agree, though, with what you said in an earlier
hearing, that often when Congress puts a gun to its head it
pulls the trigger. And so, if you are putting in sticks in the
progress, you want to make sure that you are willing to accept
those sticks. So, I am much more of a carrot person.
And I think that from the Senate perspective, the
particular carrot that works best is to create an opportunity
for a fast track where you are able to move something quicker,
with fewer amendments, and get it done.
And the cost for that is often you need a supermajority in
the committee or a deadline to produce it before X date in
order to get the right to use that fast track.
Representative Kilmer. If you or others have thoughts about
how you could get the House to buy into that approach, I would
value it, because we have been trying to think about what
carrots might look like.
Maya, you have spent a lot of time working on these issues.
And I know one of the reasons that you are as vocal on this is
that I don't think Congress is going to do anything on this
issue unless the American public demands it. And to me, that is
part of the appeal of the Fiscal State of the Nation idea, to
try to drive some conversation around budget deficits and our
Nation's debt.
Can you talk about how you see that having some potential
value?
Ms. MacGuineas. Yeah, I really do. And one of the things
that I really like about something like the Fiscal State of the
Nation is that it is not hard to do, there is nothing that is
hard about it, but it could start this positive process.
Because, I agree with you, nothing is going to change
unless you all go home and feel like your voters actually want
you to make some of these hard choices. And that has to be a
stronger sentiment, that they enjoy you giving away lots of
things, not paying for them, and fighting with each other.
But the public will not make that change on their own. That
will ultimately only come from political leadership. And so, we
have got a little bit of a catch-22.
I think the best thing to do is give people information,
give you all, the political leaders, and the President
information, and insist that it be shared in a way that this is
the effect of our budget.
Another idea I was thinking about when I was listening to
you all talk is, at the end of the budget cycle we should
actually look back and see how much you stuck with your budget
and how that played out.
But the biggest piece of it is sharing the information in
terms of the longer-term issues, what we are facing, what the
effect it would have from our political leaders, and then that
will create an understanding.
CBO, all you have to do is read a CBO document and
understand how real this is. But finding a way to share that
with voters who are dealing with a lot of things that affect
their lives personally will help them be able to support the
hard choices that you know you need to make that are hard to
make.
Representative Kilmer. You also put in your testimony, you
called out the value of establishing the discretionary spending
allocations earlier in the process. I tend to agree with that
because until there is agreement on the 302(a)'s, the
appropriations processes kind of churn without real progress.
So, can you talk about, maybe elaborate a little bit about
why you think that can help reduce some of the friction in the
budget process?
Ms. MacGuineas. Well, I think one of the most important
thing is to end crisis budgeting. Right now, things only get
done when there are action-forcing moments, and those things
are almost always suboptimal. So, you want to put a way in the
process where we know that we are not going to have shutdowns,
where these things will move more smoothly, but also they are
attached to some of the bigger choices.
So, what you want to do, I think, on the appropriations
part, is find a way where you know you can set the numbers that
appropriators will be able to start doing their work, but not
as an excuse not to do the full budget.
For instance, right now, when we have 2-year budgets in
place, you hear people already saying: Well, we don't need to
do a budget. We don't want that to be the outcome.
So back to the tradeoffs, like there are with joint
resolutions, you want to get those numbers on early and people
can make their decisions so that we are not doing the last-
minute budgeting, which really leads to poor outcomes. We have
many examples of that recently. But we don't want it to be an
excuse to drop the rest of the budget process.
Representative Kilmer. All right.
Thanks, Chairman. It looks like I am out of time. I yield
back.
Co-Chair Womack. Senator Schatz.
Senator Schatz. Thank you, Mr. Chairman.
Thank you to all the testifiers. Great conversation so far.
First, a comment about the purpose of this committee on a
bipartisan basis. The problem that we are here to try to solve
is CRs, shutdowns, debt ceiling, a lack of the regular order on
the budget and appropriations process.
The problem we are not here to solve is long-term solvency
of the Social Security Trust Fund, Medicare, and Medicaid. That
is for another day, and that is sort of outside of our ability.
I mean, remember that the statute that enables this committee
is supposed to provide something to both houses for an up-or-
down vote by the end of the calendar year.
And so, although all of those conversations are
interesting, and I am tempted to engage with you, Ms.
MacGuineas, about Social Security, I will resist that
temptation.
But actually, that illustrates my point, that we want to
make sure that we calibrate our ambitions so that what we do is
what is possible this year and we don't have an academic
discussion that either goes completely sideways by the end of
the year or ends up becoming a partisan conversation.
If all this committee did was get us on a path towards the
regular order, maybe by eliminating the debt ceiling as a
weapon, maybe by rationalizing the budget process, that would
be a tremendous accomplishment. We don't have to fix the
country at this table in the next 6 months. We should just get
ourselves on a path to do so.
So, along those lines I am going to talk about some small
things, what I think are small things. The 1974 Budget Act
provides that the President is required to submit a budget by
the first Monday in February, and then 6 weeks later the
committees are requested to submit their views, and then the
Budget Committee is supposed to act by April 15.
I guess my question is, at least as long as I remember
paying attention to politics in this town, we always ignore or
reject the President's budget. And to the degree and extent
that this committee is literally about asserting our Article I
authorities, our constitutional prerogatives, I guess I am just
wondering why we need a President's budget at all.
So, it is in certainly direct contradiction from your
proposal, which would actually elevate and make meaningful the
President's budget, and then we have to make our own, and then
it is subject to signature or veto.
My view is, if what we really think is the executive
proposes and the legislative disposes, why don't we just go
ahead and move quicker and take out that one step, because I
think from a timing standpoint, in addition to aligning the
fiscal and the calendar year, those are just kind of some minor
tweaks that would allow us to sort of get to business right
away.
And I will just go down the line.
Ms. MacGuineas. Okay. So, I would say, by all means, the
process should start earlier. There is nothing wrong with
changing the calendar.
There are some good things to be said for the President's
budget. One is that it is important to understand from the
executive branch the statement of values. And two, there is a
lot of good policy work that goes into it. So, if you read the
fine print, there are a lot of ideas you can pull out and use
that are very helpful.
But I think recognizing that the beginning of the real
process is Congress' budget makes sense.
Senator Schatz. Okay. That is fair. That is fair. So we can
still have a process.
Ms. MacGuineas. You don't need to wait.
Senator Schatz. But there is no reason to start the clock
upon receiving the Pres budg.
Ms. MacGuineas. I would agree with that. Right.
Senator Schatz. Okay. Mr. Capretta, go ahead and disagree
with me.
Mr. Capretta. Well, that is okay. First of all, a longer-
term perspective would show that Presidents' budgets have had,
in past times, depending on the political circumstances, a lot
of influence. So, 1981 was not 2018. Neither was 1993 or 1997.
So sometimes in our history Presidents' budgets have been
very consequential, so I would be careful about just saying we
don't need this.
I would also agree with the point that there is lots of
detail that is very important. The appropriators would never
agree to get rid of the President's budget, because it is
chockfull of detailed information about what is really going on
at the account level that they need to then write the
appropriation bills.
Senator Schatz. Right. But maybe we don't, I am serious,
maybe we don't need to call it a budget if it is really not a
budget and it is not the basis for our budget.
Mr. Capretta. Well, a lot of people would disagree that it
is not a budget. But, anyway, I think it depends on the
circumstances.
Senator Schatz. Mr. Dauster.
Mr. Dauster. I am going to bring my recollection of working
at the end of the Clinton administration in the White House,
and the budget was a useful document to get the rest of the
government to pay attention to what the President wanted to be
done.
The OMB has to organize the government to be reactive to
the administration's priorities, and for that purpose alone it
is a very useful thing.
And I agree with what was said earlier as well.
Mr. White. Well, I think, first of all, remember the basic
problem is to relate details to totals. And so long as the
President doesn't have too many magic asterisks, the
President's budget does create a template that does sort of do
that and that you can then work off of in other directions.
I think that, again, so long as OMB actually has enough
staff and isn't doing all sorts of other stuff, it provides a
review, a scrubbing of the estimates, which is also useful to
the appropriators.
Somebody once told me that the National Cancer Institute
direct pass-through budget is totally useless because it is too
big and you don't know what to do with it. So, the Presidential
scrub is useful on appropriations. The President's budget gives
a template, if he doesn't lie too much, about fitting totals to
details.
And the last thing the President's budget does is it gives
an ability to pass on blame. So, if the President proposes
something and it is unpopular but you sort of want to do it
anyway, you say: Hey, it is his idea.
And if the President proposes something and it is unpopular
and you don't want to do it, then you say: Okay, we are going
to go cut something else, and the people we cut will be really
angry at us, but then we have the people we saved from the mean
old President's budget.
So, the President's budget is partly about blame allocation
and serves some useful purposes for Congress in that.
Senator Schatz. I don't think we need another mechanism for
blame allocation.
Mr. White. Avoidance, blame avoidance.
Co-Chair Womack. Thank you, Senator.
Senator Hirono is on her way back from a vote, so we are
going to hold this hearing open for a few more minutes waiting
on her re-arrival.
I do have a question, though. And while we are waiting on
her, if anybody else has a question, we will take those as we
can.
There has been a lot of discussion about the appropriations
piece of this whole process. I have a theory, and I am an
appropriator, that once we do appropriations work, once we have
302(a)'s and sub-allocations and we actually complete our
appropriations process, the Appropriations Committees,
certainly the subcommittees, are finished. They don't do a lot
more. At least that has been my experience.
Would an appropriations process that would scan longer than
an annual process open up the opportunity for more and better
oversight?
Anybody.
Mr. Dauster. I think some of your best oversight is when
they have to come in and talk to you about the budget, though.
If they don't have to worry about the budget or about being
funded, they are going to be less concerned with the oversight.
Mr. White. Yeah, I guess the question is, if they have some
time to do more work--obviously, most of the work, sorry, is
done by the staff, right? It is like being a student. There are
these really heavy periods and then these slower periods. And
they, unlike you, don't have to go back and talk to the public,
and so they have some time which could be used studying and
learning more about the agencies, in theory.
I am not sure. Biennial appropriations would just get less
attention, and I don't think it would give extra time that
would really be helpful, my perception from the years I have
spent looking at the Appropriations Committee. But really that
is more sort of the Members' judgment as to what could be
better accomplished.
Co-Chair Womack. Mr. Capretta.
Mr. Capretta. Yeah. I think that it is possible that not
spending so much time on appropriations could free up more time
for the Congress to do other things in various ways, not just
the appropriations subcommittee.
I think the real question is that Congress, I think, needs
to spend a lot more time doing oversight work of mandatory
spending, too, frankly, that there is lots of detail going on
in the mandatory spending side, where the money is going out
the door without any annual appropriation, where a little more
scrutiny would be helpful.
Some of these programs have a big label on it and there are
15 things going on below the surface, and not a lot of Members
of Congress, I think, understand that.
And so, looking at military pensions and all the things
that go on with that, looking at the entitlements in the
Veterans Affairs area, looking at even Social Security and, of
course, Medicare and Medicaid, they are big programs. They are
spending literally hundreds of billions of dollars. More and
more oversight of what is really going on in those programs, I
think, is most useful.
Co-Chair Womack. Maya.
Ms. MacGuineas. Yeah, I agree with Jim's point in terms of
where the oversight is most lacking.
There is actually a lot of good evaluation that goes on of
a lot of our discretionary programs. It is not worked into the
budget process probably as much as it should be.
But where I think we need to be spending more time is both
on oversight of the big mandatory programs, and also,
thinking--and this is again why I think the long-term is so
important--thinking about not just where our resources should
be right now, but where they are going to need to be.
And when I look at the world in the next 10, 15 years, one
thing I am pretty certain of is we don't understand how our
economy is going to look, with the future of work, with
technology, with AI. These things are changing dramatically.
And somewhere in the budget process you also want to be
really working in the time and space and thought for evaluating
how we want our budget to help the whole country move forward.
So, there are a lot of things we need to use extra time for
more of, and I would focus on some of these big, big, thorny
issues and evaluation of the big programs.
Co-Chair Womack. Senator Hirono, welcome back.
Senator Hirono. Thank you very much for holding this
meeting opening.
And I want to thank all of you.
As we sit here, be honest with me, all of you, whatever we
come up with, unless there is the political will to do it, is
for naught, right? So that is the thing.
I mean, to me, I would like to lay out some parameters so
that we have something to shoot for. It is sort of like the
Constitution, there are ideals exemplified in the Constitution.
One hopes that we can work toward those ideals.
But I just don't know what it is going to take for the
political will to actually abide by whatever we come up with.
But that doesn't mean that we shouldn't make an attempt.
So, I do have a question for you, Mr. Dauster. You have
been around for quite a while, and you have been through myriad
debates about drafting of and living with budget process reform
legislation. And I think you said that you are more of a carrot
person than a stick person.
So, of all of the various processes and reforms that you
have seen enacted during your time on the Hill, which were the
most effective in your view, and what made them effective?
Mr. Dauster. Thank you, Senator. I agree with your general
introduction. You want to try and do the best possible, but no
more.
The one that I enjoyed the most or I thought was the best
change was in 1990. We were coming out of a fixed deficit
target regime under Gramm-Rudman, and we changed that to a cap
and PAYGO system, where you make the people who do the deed
responsible for what they do.
And so, I think that was the direction of change that makes
the most sense: Make your process punish the people who do the
thing that went wrong. Don't punish everybody.
Senator Hirono. I think that the PAYGO system--which we try
to abide by. I mean, that is one that we usually try to come up
with, how we are going to pay for whatever changes we are
making.
Now, I think, Ms. MacGuineas, and maybe some of the others
of you, talked about how transparency is really important and
that we don't really spend a lot of time especially educating
the public, much less Members of Congress. But we do have many
more opportunities to find out what the ramifications of our
processes are and our appropriations, et cetera.
But where does the public understanding of all of this come
into play? And what role could conveying more information to
the public play in informing the kinds of actions that Congress
takes?
Ms. MacGuineas. I do think it is critical--and we have
talked a bit about the Fiscal State of the Nation or other
approaches like that, which I am a big supporter of--I think it
is more critical now than it is ever been. Because, frankly,
when you talk about budget process and all the different terms
that you all are familiar with, they are not just meaningless
to the public, they are alienating.
And it is just another example of kind of a language where
Congress is using something where your constituents don't
understand what you are talking about. And I think it leads to
the frustration and just throwing your hands up with
Washington: I don't even understand what they are talking about
and it makes me feel not a part of the process.
So, I think transparency is really important. I also think
simplifying the process in ways that it can be conveyed to
people is really important.
And to your first point, I think everybody agrees, I know I
certainly agree, that there are a lot of aspirational things
that you want to do on this committee. But the best things that
have worked in the past is when members of different parties
and different bodies have gotten together and come up with
something.
So, again, I will kind of end with where I started, which
is getting something done is one of the key things. And if you
take a small step here it can really lead to something.
Senator Hirono. I agree that getting members of both
parties to buy in, maybe one of the ways structurally we can
encourage that, is for the chairs and the ranking of the
authorizing committees to be members of the Budget Committee,
because that is not what happens now.
Anybody want to respond to that?
Mr. Dauster. I definitely think that makes sense. Senators
Inouye and Kassebaum were advocates of that back in the day.
And it would get more buy-in.
The only problem is you have members of the Budget
Committee right now who view their membership as a thing of
value. That is why I would argue as openings come up----
Senator Hirono. I don't know. Have you talked to Senator
Whitehouse recently?
Mr. Dauster. As openings come up, and there may be more
openings, give the other chairs a first right of refusal to
join in and sort of move to a place where you have the chairs
and rankers, not all members.
Mr. White. I think it is important not to--there are two
different things being talked about here, right? One is, what
would make the budget process itself get better attention and
so on and more buy-in? And the other is what to do about the
process of changing the budget process. And I think that quite
possibly making up the Budget Committee from chairs of other
committees might make sense.
But I don't think anything is going to really get the
public's attention in a positive way. I think people are always
blaming public distrust of government on whatever it is about
the government that they don't like. And whether the public
actually cares about any of this stuff, or many members of the
public, seems quite questionable to me.
And for transparency to matter people have to be willing to
look. And we can try to propagandize the public by coming up
with a statement about our fiscal future, but somebody is going
to write that statement. And whoever writes that statement,
there might be some arguments about the way they write that
statement.
So, I would like to provide much more information. I am not
sure I would disagree with CBO writing a statement maybe.
But I really think that, at least for the current purposes,
focusing on what could be done about the budget process would
do a little bit of good. This year, sort of along Senator
Schatz's lines, that would feel nice, to have something nice
happen.
Senator Hirono. Well, if we can automatically increase the
debt ceiling, that would be a very positive thing as far as I
am concerned. But this is why the Fiscal State of the Union may
be a really good way to educate.
You know, I don't expect the public to understand what is
going on, et cetera, but at least you give them a tool that
they could look at, not to mention all of us.
And I think my time is up. So, thank you.
Co-Chair Womack. Thank you, Senator.
Ms. MacGuineas, Mr. Capretta, Mr. Dauster, Mr. White, thank
you for appearing before this committee. Very interesting
discussion that we have had today.
I would like to advise members that they can submit written
questions to be answered later in writing. Those questions and
your answers will be made part of the formal hearing record.
Any member who wishes to submit a question or any extraneous
material for the record may do so within 7 days.
I think it should be noted that our ability to sit in here
today and have the conversations that we are having, those
privileges are secured by the hardships and the sacrifices made
by people that we will recognize on Monday, Memorial Day.
It is my hope, as chairman of this committee, co-chair of
this committee, that each and every one of you have a great
Memorial Day weekend and reflect on the sacrifices made by the
men and women who give us this outstanding privilege.
And with that, this hearing is concluded.
[Whereupon, at 12:25 p.m., the committee was adjourned.]
MEMBERS' DAY: HOW TO SIGNIFICANTLY REFORM THE BUDGET AND APPROPRIATIONS
PROCESS
----------
WEDNESDAY, JUNE 27, 2018
House of Representatives,
Joint Select Committee on Budget and
Appropriations Process Reform,
Washington, D.C.
The Committee met, pursuant to call, at 9:11 a.m., in room
HVC-210, Capitol Visitor Center, Hon. Steve Womack and Hon.
Nita M. Lowey [co-chairs of the Committee] presiding.
Present: Representatives Womack, Woodall, Arrington, Lowey,
Yarmuth, Roybal-Allard, and Kilmer.
Senators Perdue, Ernst, Whitehouse, Bennet, and Hirono.
Co-Chair Womack. The hearing will come to order.
Good morning and welcome to the fourth public hearing of
the Joint Select Committee on Budget and Appropriations Process
Reform: Members' Day.
This select Committee is focused on ensuring Congress can
fulfill the most important and essential role described under
Article I of the Constitution, the power of the purse. Long
before our Committee was formed in February, there was
bipartisan agreement throughout the Capitol and across the
country that the current process for completing this basic
function of government is in need of substantial improvement.
That agreement led to bipartisan, bicameral support for the
creation of this panel as part of the Bipartisan Budget Act of
2018.
This Committee of 16 members has already spent a lot of
time building consensus on some of the problems and conducted
three previous hearings to consider solutions. Today's hearing
gives members who know that budget and appropriations reform is
necessary the opportunity to participate in this essential
work. This hearing is meant to engage all Members of Congress
from both sides of the aisle and both ends of the Capitol and
solicit their ideas for possible reforms to improve the current
process. We believe doing so is key to our continued efforts
and eventual success.
I am encouraged by the level of interest and participation
from those testifying in person and those submitting statements
for the Committee's consideration. We are grateful for your
input and your ideas.
We are particularly excited to welcome some of the House
leadership. Speaker Paul Ryan, Democrat Leader Nancy Pelosi,
and House Democrat Whip Steny Hoyer. Thank all of you for being
here.
And thank you to everyone for joining us and offering your
valuable perspective. We are eager to hear your ideas.
And, with that, I want to yield to my friend and co-chair,
the gentlelady from New York, Nita Lowey.
[The prepared statement of Steve Womack follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Lowey. Well, thank you. And welcome to our
Members' Day hearing where we will hear from Members of the
House and Senate about what should be done to improve the way
Congress handles budget and appropriation matters. There is no
shortage of complaints about the budget process. Budget
resolutions are often adopted late or not at all. Budget rules
are routinely waived.
All too often, appropriation bills don't get enacted until
the fiscal year is well underway, creating major uncertainties
and problems, and appropriation bills get encumbered with all
sorts of extraneous legislative riders, which contributes to
the controversies and delays.
Changes to the budget process might help reduce some of
these problems, and that is our task here. For example, we need
to find a way to get agreement on appropriations top lines
early in the year so that the appropriators can get to work
filling in the details. We need to find a better way to deal
with the debt ceiling, a law that serves no useful purpose but
invites brinksmanship that threatens our Nation's credit rating
and the health of our economy. And we need to find a way to
make our budget resolutions more effective tools for
formulating and carrying out budget decisions.
But there are also limits on what can be accomplished with
rules changes. Flawed rules and procedures aren't the root
cause of much of what people complain about in budgeting.
Rather, the root cause often lies in deep divisions over
policy, combined with misplaced priorities, partisanship, and
polarization. We need to find ways of alleviating those as
well.
It is gratifying and encouraging to see the number of
Members participating in this hearing. And we are particularly
honored to have with us the Speaker of the House as well as the
Democratic leader and the Democratic whip. I look forward to
everyone's testimony.
Thank you.
[The prepared statement of Nita Lowey follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you, Ms. Lowey.
With several Members testifying today, we have a long
morning ahead of us. Therefore, before we begin, I would like
to inform Members that we plan to take a brief recess at about
10:30 this morning so that you can check email, make phone
calls, and take a comfort break.
As a reminder, Members will have 5 minutes to give their
oral testimony, and their written statements will be submitted
for the record. Additionally, members of the Committee will be
permitted to question the witnesses following their statements.
But out of consideration for our colleagues' time and to
expedite today's proceedings, I would ask that you keep your
comments very brief.
I would like now to recognize our first witness of the day,
the Speaker of the House, Paul Ryan from Wisconsin. We
appreciate your time today.
It is no surprise to anybody on this panel or those
watching that you have an interest in this process, that you,
perhaps more than any person on Capitol Hill and, indeed,
throughout the Nation, know more about this process and about
the budget and appropriations process than virtually anybody.
So, your testimony is critical to the outcome that this
Committee will achieve sometime later this year.
We have received your written statement. It will be part of
the formal record. You have 5 minutes to deliver your oral
remarks. And the floor is yours, Mr. Speaker, with our thanks
for being here.
STATEMENT OF THE HON. PAUL D. RYAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF WISCONSIN
Speaker Ryan. Thank you very much, Chairman. I have never
actually had my remarks ever time-limited since I have had this
job. So, this is going to be a challenge here.
Co-Chair Womack. Yeah. No magic minutes around here.
Speaker Ryan. Exactly.
So, first of all, it is a wonderful to be here. I can't
tell you how excited I am about the fact that this Committee
exists. Obviously, I had a big hand in making sure that this
occurred. I want to thank you, Co-Chairs Lowey and Womack, for
doing this work. I am going to stick with some of my written
testimony. Then I am going to go off the cuff.
As you know, I chaired the Budget Committee, chaired the
Ways and Means Committee. I have spent basically my adult life
working within the 1974 Budget Act and the budget process. So,
I have a great deal of background in this area. And I think
that this panel is so urgent at this time.
As things stand, I think we are basically falling well
short of our tasks. We continue to fail the taxpayer. Worse, we
continue to set ourselves up for failure with the way the
budget process works these days. And it is obviously clearly
time for a new approach. And I think I can feel comfortable
speaking on behalf of Republicans and Democrats in saying that.
So, because I have this background, I just want to basically
give you a sense of my perspective on this.
Whenever, you know, there is a new Speaker, there is hope
for a new process. Members clamor for more influence, more
input. I experienced that. I came in, not running up the
leadership ladder but up the Committee chair ladder, wanting to
decentralize power in this place, empowering the Members. I
have got to say the way this budget process works effectively
is it centralizes power too much in this institution.
We do not have a decentralized power structure here. We
have a centralized power structure here that is not fair to
Members of Congress, their constituents, and the taxpayers.
So, the way I look at this, the budget and appropriations
process, it starts with good intentions. It has a good
foundation. You have a tight timeline. Even under the best
circumstances, that tight timeline leaves no room for detours.
Invariably what happens now is the process seizes up, and not
long after, the whole thing falls apart. And as a clock ticks
down, final decisions are kicked up to leadership, and that
kicks back to final numbers--a final product that Members find
unsatisfactory.
And we sit in these rooms, the four corners, so to speak,
and look over $1.3 trillion, for example, and make decisions
that ought to be made by the Members who spend all of their
time on the Committees doing the research, doing the oversight.
They are the ones who should be making these decisions. So, we
do not have a functional process, and it is--the power is too
concentrated.
So, I would even say calling this organized chaos is too
generous a description. And so, to me, all of these omnibuses
and these continuing resolutions, they are a little more than
local anesthetics. It is like an anesthesia, but the pain goes
away, but the problem doesn't go away. And it just feeds on
itself, fueling pessimism on all sides. Members become less
engaged. The public becomes more disenchanted. And with each of
these stumbles, with each new year, we are handing over more
spending decisions to the executive branch.
So, I see this as a squandering of our institutional duties
of oversight. I see this squandering the talent we have among
our Members on the Committees or jurisdiction, like the
Appropriations Committee. And more fundamentally, it is an
abdication of our critical power of the purse for the
legislative branch of government. So, I am one of those people
who is--I see the glass of life as half full. I an unapologetic
optimist. And I do believe we can solve tough problems, even
this one. And that is why I am encouraged at what you are doing
here.
The reforms that we need I think are bold, but I think they
are right in front of us. I think some of the ideas we have
been talking about for years, they are ready; they are time to
do it. And, you know, the way I look at this thing is we may
not be able to change the deadlines, but we can change the
calendar. Looking at what we are doing right now and look at
the entire appropriations process. How many of you--and I ask
Senators here. I see, you know, just a couple. How many of you
think the Senate is ever going to again do 12 appropriation
bills, separate appropriation bills, 12 conference reports,
before the fiscal year? Not going to happen. Let's just get on
with acknowledging that and come up with a process so we
actually go back to regular order on appropriations.
And this is why I ultimately think the best idea of all the
ones that we have been looking at--and I have done hearing
after hearing after hearing, 8 years at the Budget Committee as
either ranking member or Chairman, Ways and Means chair. I
think biennial budgeting is the smartest way to go. And I think
biennial budgeting has great bipartisan roots. So, it, to me,
offers a path to rewriting the process, not just reforming it.
It makes budgeting an ongoing process instead of all these
demoralizing fits and starts that we have. It brings renewed
transparency and accountability, and it sets us up to be better
stewards of taxpayer dollars.
There are a lot of different proposals I have seen on
biennial budgeting. I myself have introduced multiple
congresses the Biennial Budgeting and Enhanced Oversight Act. I
think the recent--and this really takes a lot of Senate
involvement. The recent proposal by Chairman Enzi makes a lot
of sense to me. Do six appropriation bills 1 year, six
appropriation bills the next year. So, you are appropriating
every year, and you are doing it in a workload that is doable.
And you have biennial budgeting on top of that with
reconciliation instructions. And I think it is not too much to
ask for the way the Senate works to do six this year and then
six the next year. That, to me, is probably one of the best
ideas I have seen. I don't think this violates any partisan
issue. This isn't an ideological thing. This is just, how can
Congress work better?
The way I look at this, if properly implemented, this will
empower Members to do a deeper dive on the most troublesome
issues, and it will enhance their ability to oversee the
executive branch. I think it will reinvigorate Member
participation. It will encourage actual conference Committees
and actual conference reports on individual appropriation
bills. And I think it will also enhance the importance of
reconciliation.
In 2013, Patty Murray and I got together as budget chair,
and she was--as budget chairs, and we put together a 2-year
deal. Then John Boehner and President Obama put together a 2-
year deal. And then we just recently put together a 2-year cap
deal.
So, we have sort of demonstrated that we can put together
2-year deals, 2-year spending cap deals that work. But now we
want to have, I think, an appropriations process that follows
that kind of a track.
So, the way I look at these things is take a look at the
record we have. I am just going to read from my notes here.
Last fall, the House passed all 12 appropriation bills on time.
This is the first time the House has done that since 2009. The
last time the House and the Senate passed all 12 appropriation
bills on time was in 1994.
So, 12 percent of the current Members were here for that. I
was a think tank staffer at the time. Twelve percent of the
people in the House were here the last time we passed all 12
appropriation bills. So, we have an entire generation of
people's Representatives have become accustomed to, if not
acclimated to, a failed budget process. So, we have basically
taken this failed budget process as just the way things work,
and there is nothing you can do about it.
Let's reject that kind of thinking. Let's reinvigorate a
budget process. And I am just simply giving you a suggestion as
a person who has observed this process for many, many years.
And if this body comes together and presents a plan for
reinvigorating the budget process, I really believe we will--we
can get buy-in. And I would like to think that the Members of
Congress who have known nothing but budget dysfunction would
love and welcome the day and the opportunity to actually have a
reinvigorated, workable, practical budget process where every
Member of Congress has more franchise, more influence, more
say-so. And that means the taxpayer is going to be more
respected at the end of the day.
So, I really believe, as a person who fought to create this
Committee in the last omnibus appropriations bill, I think that
you have a great opportunity in front of you. I think a lot of
these ideas are bipartisan. In the old days, as in, like, 10
years ago, it used to be appropriators against budgeteers or
against authorizers. This doesn't have to be to the case. This
does not have to be appropriators versus other Committees
because the appropriators themselves are losing their ability
to effect change.
When we do these omnibus appropriation bills, we are taking
the pen away from the appropriators and writing these bills
with just a few people. By having a biennial process with six
bills, the appropriators write those bills. The appropriators
go to conference Committee. You have a budget process that is
more likely to be adhered to. And so that to me seems like one
of the sweet spots we could have with a bipartisan, bicameral
compromise to make this budget process work. And I simply
submit this for your consideration. And I hope you really come
up with something that we can take and be proud of and restore
this branch's power of the purse.
And, with that, thank you very much.
[The prepared statement of Paul Ryan follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. We appreciate your comments this morning,
Mr. Speaker.
To be respectful of your time, do you have a couple of
minutes----
Speaker Ryan. Sure.
Co-Chair Womack.----in the event that any of our members
would like to ask a question.
The chair would recognize anyone that might have a question
for the Speaker this morning.
Anyone?
Senator Bennet.
Senator Bennet. Thank you, Mr. Speaker.
Thank you. I just would ask for your impression about how--
what has caused the centralization that you described? Why have
so many Members of Congress yielded to so few the decisions
that are made around here about budgeting and, you know, sort
of made themselves props in somebody's else play?
Speaker Ryan. Yeah. That is a good question.
So, a House guy could easily go beat up the Senate for
having cloture and motions to proceed and all of the rest of
that. But I will resist the temptation.
I think it is easier to push decisions elsewhere and not
own the consequences. I think if we have a structure that has a
chance of that--see, I think people gave up on thinking the
appropriation process works. I think people gave up thinking we
are going to do 12 bills.
First of all, think of the calendar. You get the
President's budget in March. Then you have a statutory deadline
by April 15th to pass a budget resolution, which gives you the
budget instructions, the 302(a)s, which then the Committee goes
and writes the (b)s. And then you may start your appropriations
process, hopefully as early as May but probably not until June.
And you have got to get 12 appropriation bills done through the
House and the Senate conference before September 30.
So, the thing backs up, and it just doesn't work. And so
most Members just don't think it is going to happen. So, they
don't invest themselves into participating in a process that is
going to yield results because they just know the calendar just
doesn't work. So that is why I believe if you have a biennial
budget with the caps already sort of preordained--you know,
every 2 years you rewrite those caps; I would encourage annual
reconciliation, but you have an appropriations process that can
start earlier, and you have half as many bills to do--I believe
Members will have more faith and confidence that they can
actually get the work done. So, they will actually participate
and get involved in actually getting a good product. Because
what invariably happens is we do a CR to buy us a little more
time. And then we have the appropriators kind of write their
bills and move it up. And then it comes to, you know, the
Speaker, the minority leader, the majority leader and the
minority leader in the Senate. And then we put together some
massive bill.
That is not a good way to run government. The power is
too--I am the person who gets the power. I don't want it. It is
too concentrated. It is not how government should work because
the person who is the Chairman and ranking member of the Energy
and Water Committee are spending time after time in hearings
reading GAO reports, listening to inspector generals. They know
their jurisdiction better than anybody else. They know how
these bills should be written. They know how taxpayer dollars
are being guarded or not. And they should write the bills, not
somebody who is, you know, juggling every other thing in
Congress. That, to me, is the breakdown in the process.
And by having the executive branch come to an
Appropriations Committee where they know that that Committee is
going to be writing their bill, I think the executive branch is
going to be far more responsive to the legislative branch and
the power of the purse because they know it is not going to be
some omnibus. They know it is going to be that person I am
looking at across the rostrum is going to be writing my
Appropriations bill. I think they are going to make our
government far more responsive and accountable if that is the
case.
Co-Chair Womack. Once again, Speaker, we appreciate you
being here. And, again, to be respectful of your time, I know
you have other appointments to deal with. Your insight is
valuable, and we appreciate the fact that you led on getting
this joint select Committee established and charging us with
the responsibility of coming to a solution.
Do you want to say something very quickly?
Ms. Lowey.
Co-Chair Lowey. I want to thank you also, Mr. Speaker,
because I really think if we can talk through these issues,
hopefully, we will make major changes in the process.
But I want to emphasize one point again. And I mentioned in
my opening statement. In my judgment, the root causes often lie
in deep divisions over policy combined with misplaced
priorities, partisanship, and polarization. And as an example,
I just recently met with Senator Shelby, and it hasn't been
completed, but they are working together, swimmingly. No poison
pills. They are moving through the process, getting ready to
bring the bills to the floor.
Now, I agree the process isn't over. But compare that with
the House and the process--we all work together, but each of
our bills are loaded with poison pills.
So, I just put that out there because there is a real
contrast now on appropriations the way the Senate is operating,
working together. And we all like each other. But our bills in
the House are loaded with poison pills. So that is something
that we really have to think about.
Speaker Ryan. Well, I won't do much of a retort other than
I am expecting a big bipartisan vote on the defense
appropriation bill this week. We had bipartisan support, not as
much as we would have liked on the three appropriation bills we
already passed a couple of weeks ago.
But you are right. We are going to have differences of
opinions on these things. Labor-H is a perfect example. But
let's have it on its own. Let's have those fights. Let's have
those votes. Let's have those amendments. Let's have those
conference Committees. That is the way the process should work.
And, again, Ms. Lowey, you are constricting the process. If
we just say, ``This isn't going to happen, let's just kick it
all upstairs, let's just put it in a big omni and have a bill
that is this big that spends this much,'' that is not good
government no matter how we disagree on individual riders.
Co-Chair Lowey. Perhaps we can talk again another time.
Thank you for appearing before us.
Speaker Ryan. Thank you.
Co-Chair Womack. Thank you, Mr. Speaker.
I am now pleased to welcome our next witness, the
distinguished leader of the House minority, gentlelady from
California, Nancy Pelosi.
Representative Pelosi. Good morning, Mr. Chairman.
Co-Chair Womack. Welcome, Madam Leader. And we are going to
give the floor to you. And then we will be respectful also of
your time in potential Q&A.
The floor is yours.
STATEMENT OF THE HON. NANCY PELOSI, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Representative Pelosi. Thank you very much, Mr. Chairman,
Madam Chair. Thank you to members of the Committee from both
sides of the House. I am very encouraged by the fact that this
discussion is taking place. I think it is very important and
long overdue. I do believe that a budget should be a statement
of our national values. What is important to us as a Nation
should be how we allocate our resources and that that budget
process that we are engaged in should be something that is
respected as we go forward into the appropriations process.
I have a different view on some of these subjects than the
Speaker because I come here as a long-time appropriator. I
heard the perspective of a Ways and Means Committee person, but
I do believe that 2 years for the budget, 1 year for the
appropriations legislation is the appropriate route to go.
It was music to my ears to hear the Speaker say that he
didn't think we should have legislation on appropriations
bills. Of course, that is what upsets the apple cart and all
the smooth workings of the Appropriations Committee. I have
always said, left to their own devices, the appropriators, in a
bipartisan way, know how to allocate resources, respect each
other's points of view, and can come to a balance that is
important for the Congress. It is when the legislating on
appropriations bills that enters into it, which started in the
late 1990s--I don't say that you never should have one piece of
legislation on an appropriation bill. You shouldn't have it
unless there is bipartisan agreement that, for whatever reason,
this engine is leaving the station; in the national interest,
we need to move something immediately by a must-pass, must-sign
bill.
But that is not what is happening in this case. And that,
in my tenure on appropriations, which goes way back, was what
made the difference between a smooth running of appropriations
instituting the budget agreement or not.
The Speaker said very eloquently that people on these
Committees know their briefs, oversight responsibilities on the
Appropriations Committee. And left again to its own devices, I
think it could do a very good job.
So, a few principles I want to put forth. First, I do
believe that when we have sent Members to any of the
discussions on budget, we just say go--be agnostic. Just go
into that room, put growth in the middle of the table, and say,
what will promote growth, create good-paying jobs, and reduce
the deficit? Those are our standards. We don't give you any
assignment to say do this, do that. Growth, good-paying jobs,
reduce the deficit.
I do think that we should return in that light to pay-as-
you-go budgeting, which Republicans abandoned in favor of
creating huge deficits and then using those deficits for
another purpose, cutting Medicare--Medicare and Social
Security. I will get to that in a moment.
Second, we should amend the reconciliation process so it
never is used to increase the deficit. So, it is never to
increase the deficit in the budget window.
And, third, Republicans should do no harm. None of us
should do harm to the process. We must pass constitutional
amendment--not pass constitutional amendments or implement cap
limits on mandatory spending. And they must stop using the
budget resolution as a messaging document to call for
unspecified and unrealistic spending cuts not included in the
reconciliation instruction. I don't want to waste your time. I
am being very direct in what I am recommending.
We hear people blaming Medicare, Medicaid, and Social
Security for the record deficits and debt levels, but the
driver is simple demographics, not extravagant spending. For
example, I think it is important as we go forward that we note
the reality of the demographics. We reduce the replacement rate
in Social Security when the average retiree benefit is only
$1,400 a month. Medicare does not cover vision, dental, or
hearing benefits; does not have an out-of-pocket limit. Most of
the elderly has a form of supplemental coverage costing around
$150 a month. So, it is not about extravagance on that end.
Medicaid is by far the least generous initiative in terms of
reimbursing providers.
The elderly population--now, this is the demographic issue.
The elderly population will double between 2010 and 2035. The
elderly population increasing from 40 million to 80 million
people, from 13 percent of the population to 20 percent of the
population. In fact, demographics account for 80 percent of the
increase in outlays for these initiatives from fiscal year 2018
to 2028.
I am sticking to my notes on some of this in the interest
of time--because I could go on. In light of these demographic
shifts, we need to work on a bipartisan basis to reduce health
spending. We are proud of what we did in the Affordable Care
Act, slowing annual Medicare spending program per capita from
2.3 percent in the 5 years prior to the enactment of ACA to a
negative 0.3 percent in the year since enactment. We must build
on that progress through far stronger reform than those
proposed by the Trump administration. We need to allow Medicare
part D--we have been trying to do this for years. We need to
allow Medicare part D to negotiate lower drug prices, push
payments and delivery reform through Medicare and Medicaid
innovation center, and work toward paying for value rather than
volume of health services.
This should not be a partisan debate. Hardworking families
across the country cannot afford the skyrocketing cost of
healthcare today. When we passed the Affordable Care Act, in
terms of budgeting, if everybody loved their healthcare and
their health insurance, we still had to do it because of cost:
cost to the individual, cost to small business, cost to
corporate America, cost to the public sector. We simply could
not afford the escalating rate of increase. As I said before,
reduce that, but the cost of prescription drug is still the
biggest obstacle to levelling all of that.
So, to return to responsible budgeting, I encourage
Congress to move toward the 2-year budget agreement. I agree
with the Speaker on that. Maintain annual appropriations. I
agree with Congresswoman Lowey on that. And do not adopt
automatic continuing resolutions. Imagine that we had five CRs
between last year and when we passed our omnibus.
We must make it easier to pass debt limit increases. That
shouldn't be taking up time, debate, and leverage. Members have
attempted to hold the country's credit hostage to individual
demands, risking grave consequences for our economy and our
country and our credit rating. Even when we didn't do it, just
talking about it lowered our credit rating. We should urge the
Senate to adopt the Gephardt rule. The Gephardt rule enabled
that just to go through that, as the Constitution says. The
full faith and credit of the United States is not in doubt;
just have it go through. So, we take that off the table.
While some pay lip service to the principle of fiscal
responsibility, we have fought to put our fiscal house in
order. I am very proud that, in the 1990s, President Clinton
put us on a trajectory of job growth. We come back to that, job
growth and smaller deficits, despite inheriting a massive
deficit. The last four Clinton budgets were in surplus or in
balance.
President Clinton handed President Bush a projected $5.6
trillion 10-year budget surplus. But when you do away with the
pay-as-you-go, that surplus was squandered again with massive
tax cuts for the wealthy that did not--two unpaid for wars, not
negotiating for Medicare prescription drugs, all of that,
according to the CBO, is what added to the deficit.
The tax cuts and spending sprees exploded the deficit, plus
a new $5 trillion--that is an $11 trillion turnaround. We went
from $5 trillion plus on a path to reducing the debt to $5
trillion additional debt. $11 trillion turnaround. We cannot--
this fiscal recklessness cannot continue.
Passing a tax scam for the rich--I will express my
disagreement with that--has increased the deficit. And it has
not--it has increased the deficit, and it is going to be at the
expense of Medicare, Medicaid, et cetera.
When the President took office, he said the current
services projection of deficit over the period for fiscal year
2018 to 2027 was $9.4 trillion. Now, due to the Republican tax
bill, the CBO's latest current services projection that they
send here is over $2.3 trillion larger. It just can't continue
with that to a staggering--the reckless giveaways have exploded
the projections for the annual average deficit to 8.4 percent
of GDP. The deficit, not the debt, the deficit to 8.4 percent
of GDP.
So, in this--where we find common ground: 2-year budgeting.
What I would advocate as an appropriator, very important, to
have 1-year--the annual appropriations bills. What I think is
problematic to that is the massive legislation, sometimes in
the form of poison pills, that are being placed on these bills.
It almost makes us want to make everybody be a member of the
Appropriations Committee. It is no use for other Committees to
exist because we can just pile it on the Appropriations
Committee and in a way, that is not bipartisan. I don't think
either party should do it.
So, Members of Congress must honor our responsibility to
make smart investments, promote growth, create good-paying
jobs, reduce the deficit, and do so in a way that keeps the
deficit under 3 percent of GDP when the economy is healthy
while driving strong, again, sustainable growth.
I thank you for your attention to this important issue. I
hope that--just looking at this Committee, I think that there
is real opportunity for you to do something that will make more
efficient, more predictable, more timely the process. But,
again, it is all about our values, what is important to us as a
Nation.
We have sufficient time in our Committees of authorization
to debate the policy. That shouldn't be something that is
placed--you know, appropriating is policymaking in itself.
There is enough going on there. But to use the appropriations
process as a vehicle for poison pills and partisan
policymaking, it just discredits the responsibility we all
have.
When I was a little girl, my father was a member of the
Appropriations Committee. He would talk in his political
speeches in Baltimore about the all-mighty powerful
Appropriations Committee. As a very little girl, not even in
grade school yet, it would, to me--all-mighty powerful, that
was only identified in one way, in a heavenly way. And now it
was attributing it to the Appropriations Committee.
Let's have the Appropriations Committee retain its power,
assume no more, and be responsive to a responsible bipartisan
budget resolution.
Thank you for the opportunity to share some thoughts with
you. Again, it is no use wasting your time. I thought I would
get right to some clarity of thinking on my part to propose.
[The prepared statement of Nancy Pelosi follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. We truly appreciate your insight here this
morning.
Does the gentlelady have time for maybe a question or
comment or two?
Representative Pelosi. Sure.
Co-Chair Womack. Does anybody----
Representative Pelosi. If anybody has one.
Co-Chair Womack.----on the Committee have a question or
wish to make a comment?
Hearing none.
Representative Pelosi. Thank you.
Co-Chair Womack. Thank you very much for your time.
Representative Pelosi. Thank you for your good work. And
good luck in your deliberations. Hopefully a nice bipartisan
advance into the cause will spring from your good work.
Thank you so much.
Co-Chair Womack. Thank you so much.
Representative Pelosi. Thank you.
Co-Chair Womack. At this time, we will welcome our next
witness. He is the Democrat whip in the House, the gentleman
from Maryland, Steny Hoyer.
Mr. Hoyer we appreciate the opportunity to hear from you
this morning. We will hear your testimony. And then, if time
permits, may have a question or two.
The floor is yours, sir.
STATEMENT OF THE HON. STENY H. HOYER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MARYLAND
Representative Hoyer. Thank you very much for welcoming me,
Chairman Womack and Co-Chair Lowey. I appreciate very much this
opportunity to share my thoughts with the Joint Select
Committee on the Budget and Appropriations Process Reform. In
context, I served actively on the Appropriations Committee for
23 years. Obviously, I am on leave for some years now.
In the few minutes I have, Mr. Chairman, I want to talk
about three important areas where reform ought to occur. The
first is congressionally directed spending. Now, this may not
sound like some great reform issue to people. But as somebody
who served on the Appropriations Committee, I see it as a
critically important connection to my district, that I can
respond to the needs of my district, which I believe I know as
well as any other person and certainly any other person in the
executive department.
Members of Congress know their districts, as I said, better
than anyone of the Federal agencies and better than the
Appropriations Committee as a whole. When Republicans came into
the House majority in 2011, they made a mistake by eliminating
congressionally directed spending through changes in their
conference rules. Unfortunately, they also changed the Gephardt
rule.
My own view, Mr. Chairman, is the debt limit ought to be
eliminated. It is a phony issue. It lends itself to
gamesmanship and brinksmanship which is harmful to our country
and not honest with the American people. They both gave up
Congress' constitutional power of the purse to the executive
branch and made it more difficult to forge consensus in major
legislation.
It is true that some Members abused the process in the
past. That is why, when Democrats came into the majority 2007,
we reformed the process to make it transparent and to hold all
Members accountable by showing the public which Member
sponsored each item, requiring Members to certify they had no
financial interest and published all requests on their websites
and blocking for-profit entities from receiving them. This
Committee should consider bringing back congressionally
directed spending, at a minimum, with the Democrats' successful
reforms and others to make it more transport if you thought
that was necessary.
The second area, Mr. Chairman, I want to address is paying
for what Congress buys. The problem is not spending. The
problem is not taxing. The problem is paying for what we buy.
That is the discipline in the system. And to the extent that we
allow ourselves to simply borrow to buy what we want to buy,
that discipline disappears. I would suggest to you it also has
disappeared in tax cuts. To give a $1.5 trillion headroom is
simply to give additional debt credence. If you had to pay for
that, if you had to offset it by spending cuts either to
mandatory or to discretionary spending, that would be
discipline in the system. But we have eliminated the discipline
in the system.
This Congress ignored the statutory paygo rule, law that
Democrats enacted in 2010, and the current House majority
replaced the effectively House paygo rule. I would suggest to
you, when we were operating under paygo, we balanced the
budget. We balanced the budget because, frankly, Republicans
limited spending. Clinton wouldn't allow tax cuts, and the
economy exploded. Those three things are why we balanced the
budget four years in a row.
The House Republican alternative to cut--of CutGo only
deals with spending which left the door open for this majority
to pass a tax law that raised deficits by $1.8 trillion last
December and trillions more over the period it has been a House
rule.
Paygo deals with both spending and revenues in a balanced
way. To pretend that it is only spending and not the cut in
revenues that put you in the hole is dishonest. This allows
Congress full flexibility to make our collective political
decisions as to the best mix of policies to offset the cost of
any new legislation.
Third, any budget process will only be successful if there
is the political will to follow it. Pretending the process will
solve this problem is a delusion. The current process had been
effective when Congress chose to pursue it. If the Budget
Committee were allowed to do its job and did it honestly and
responsibly and not simply as a political message--no party is
immune from passing budgets that are simply and solely
political messages without relevance to reality--it would be
the legislative branch's loudest voice in setting overall long-
term fiscal policy if we would be honest.
Too often, in recent years, the Budget Committee has been
sidelined, only called upon when the majority decided
reconciliation instructions were necessary to force through
partisan legislation. Last year's tax law was a perfect example
of abusing the budget process by using a tool intended for
deficit reduction ironically to be one of the largest deficit
increases that I have voted on in my 37 years in the Congress
of the United States.
Mr. Chairman and Madam Co-Chair, I should note that it is
not my assessment of the fiscal impact of that legislation. It
is the combined assessment of the Congressional Budget Office
and Joint Committee on Taxation. Collectively, we must rely on
their status as nonpartisan arbiters in order for any budget
process to function as intended. Mr. Chairman, just yesterday,
we heard from the CBO that our debt as a share of the economy
is set to double over the next three decades.
Mr. Chairman and Madam Co-Chair, I have three children. I
have three grandchildren, and I have four great-grandchildren.
The fiscal policies we have been pursuing are not only fiscally
bankrupt; they are morally indefensible. I hope that this
Committee will include in its recommendations a restoration of
transparent accountable congressionally directed spending that
restores Congress' constitutional role and a return to the
proven enforcement of paygo.
I also hope that, in making recommendations, you also
recognize that, at the end of the day, regardless of what
changes you make or propose, in order to be effective, Congress
has to want to follow whatever process it creates for itself.
We have biennial budgeting. We call it the fixes to our
structure of saying that we are going to spend at a certain
number. And then we say that doesn't work. That is unrealistic.
It was good message. It was good pretense. And then we change
it. We make a 2-year rule to suspend, sequester, which is a
complicated word, which starts with S which stands for stupid.
It is up to the majority to see that through, to set the tone,
even when it is not convenient.
The Speaker said he wanted to consider things one at a
time. He thought the Committees had the advantage. Yes. Then
bring those bills discretely to the floor, and let them be
considered one by one. It is inconvenient, particularly when
you don't want to vote on the Labor-Health bill; you don't want
to vote on the Defense bill. You package them. You hide them.
You dissemble.
As you can tell, Mr. Chairman, I feel pretty passionately
about this because I think neither side has come to grips with
the real problem, and that is we don't follow fiscal
discipline. We pretense. We talk. But then it becomes too
difficult because life and budgeting is a series of tradeoffs,
and we don't like to make tradeoffs because tradeoffs sometimes
cost you political capital. You can do all the debate you want
about process. But if we don't have the will to do what is
right fiscally, our people will not be well served.
Thank you, Mr. Chairman.
[The prepared statement of Steny Hoyer follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I appreciate the comments of the Democrat
whip in the House.
Are there any members who have a question?
I will throw one at the distinguished gentleman from
Maryland, and that is, in your discussion, you talked about
three things, the third topic, that being the political will.
One of the things this Committee has discussed numerous times
and is under consideration, the concept of carrots or sticks,
whatever it is. What can we do to motivate, influence in a
positive way the kind of outcomes that we are looking for
versus holding Congress accountable with a series of
consequences for failing to do its job?
Where is the Democrat whip on the subject of positive
reinforcement or some kind of consequence as a means of
bringing us to the political will to make these changes?
Representative Hoyer. You mean beyond ``atta boy, good job,
that was the right thing to do,'' I presume.
Co-Chair Womack. Beyond optics. It has got to be beyond
optics.
Representative Hoyer. I think the paygo is where you get to
the rubber meets the road. It is where you--if you want to cut
taxes, if you think, you know, we are spending too much and we
ought to cut revenues, fine. Cut spending. Don't cut taxes and
then never cut spending. We don't cut spending. It is that we
have different views of what spending ought to be on.
I noted to the majority leader: zero rescissions in
defense. Zero. Raise your hand--and I am saying this
rhetorically; I don't want to put you on the spot--if you think
there is not zero rescissions in $700 billion dollars we give
to the defense fund. Of course not. So, you spend--some parties
spend it here; some parties spend it here. But we spend it.
If you had paygo, if you really had to make choices, they
would be tough choices. And we ought to make those tough
choices. And the only way you make them is bipartisan way. And
we don't do things bipartisan way.
When I was, frankly, the majority leader, we passed all 12
appropriation bills seriatim, one at a time, prior to the end
of August--excuse me--the end of the July break, or might have
been the first week in August.
So, I am not sure what you mean the carrots and sticks. But
what we ought to do is discipline ourselves and have the will
to be honest with the American people, to tell them there is
not a free lunch, to tell them: If you want a tax cut of $1.8
trillion, then there is going to be a tradeoff. Something is
going to give. It is not going to be we are going to grow the
economy, and wonderful things are going to happen. CBO is
saying that has not happened. The economy is showing that has
not happened. It is not going to happen. It didn't happen in
1981 when I came here. It didn't happen in 2001, in 2003. We
were promised great things were going to happen. We had the
deepest, worst economy that I have experienced, that anybody in
this room has experienced starting in December of 2007.
So, what I am saying, Mr. Chairman, is process is terrific.
Will and courage are what is needed: to be honest with the
American people and with ourselves and say there is no free
lunch. We are not going to cut revenues, and all of a sudden,
magically we will have the resources necessarily to defend our
country, to grow our economy, to feed our people, to make sure
that America is all that it can be. That is what I am saying,
Mr. Chairman.
Co-Chair Womack. I appreciate your comments.
Any other questions?
Representative Hoyer. Thank you very much.
Co-Chair Womack. Thank you, sir.
Delighted to introduce our next witness, the gentleman from
Tennessee, Senator Bob Corker. Sir, it is great to have you in
front of the Joint Select Committee this morning.
Again, as I said earlier, your written comments will be
made part of the record. And we will give you the adequate
amount of time to make your case this morning before this
Committee, and we appreciate you being here.
STATEMENT OF THE HON. BOB CORKER, A UNITED STATES SENATOR FROM
THE STATE OF TENNESSEE
Senator Corker. Thank you. Thank you for holding these
meetings. And I appreciate what you are doing. I will be very
brief. I know we all are a little bit behind schedule.
First of all, I came to Washington 11\1/2\ years ago. And
one of the focuses was on fiscal issues. And what I have
learned is that Democrats and Republicans both like to spend
money. They just like to spend it on different things. I became
a member of the Budget Committee a few years ago. It has been
the biggest waste of time one can possibly imagine. It has
nothing to do with the leadership of the Committee. It is that
it is nothing but a political tool each side uses. There is no
policy put behind the changes.
And as I have said to Senator Perdue and others, Senator
Whitehouse, we ought to actually do away with the Budget
Committee because it performs no useful function as it relates
to causing us to be fiscally sound.
Secondly, we major in the minors. There is all this talk
about appropriations. So, we spend the entire year focusing on
30 percent of what we spend, which, again, is majoring in the
minors; 70 percent of the money we spend is on mandatory
spending. These are programs that people are counting on,
especially during the latter years of their life, and we do
nothing whatsoever to ensure that they are going to be fiscally
sound.
Everything ought to be, in my opinion, on budget,
everything, including Social Security, which would cause us to
focus on the fact that, in the not-too-distant future, it is
going to be fiscally unsound.
So, you know, again, there is a lot of talk and a lot of
work that goes into appropriations and budgeting each year, but
we major in the minors. The appropriations process is, you
know, that we have authorizing Committees that have absolute--
almost nothing is authorized. And so, seriously, we ought to
consider combining the authorizing functions and the
appropriating functions together. It ought to be one.
I talk to people on the foreign ops side. I am Chairman of
the Foreign Relations Committee. And there may be a little of
hyperbole here, but they tell me they spend about 5 hours
putting together over $50 billion worth of spending whereas the
authorizing Committee itself spends all year doing hearings. It
is totally ridiculous.
So, look, I think you have got a big task. I would say,
first of all, put everything on budget--everything. Look at
combining the operations of both authorizing and appropriating.
Do away with the Budget Committee and let a few leaders decide
what the caps are going to be over the next couple years and
quit using the budget itself as a political tool.
Beyond that, I really don't have many comments.
[The prepared statement of Bob Corker follows:]
[[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. We appreciate the gentleman for his
appearance here this morning.
Any questions?
Senator Whitehouse. If I may.
Co-Chair Womack. Senator Whitehouse. Welcome.
Senator Whitehouse. Senator Corker joins me on the Budget
Committee. So, he knows whereof he speaks. And I wanted to
thank him for his work on the Budget Committee. He is one of
the reform-minded folks.
Before we entirely get rid of the Budget Committee, at
least in the Senate, I think we should give it one last chance.
And as I have said in my earlier comments and in the proposal
that I have shared with the Committee, I think there is a
chance to create a bipartisan path that would actually have to
be bipartisan in order to be taken that would take into the
account the mathematical elements of the budget, all of them,
healthcare spending, tax spending, the whole bit, and see if
the Budget Committee can work together to get a bipartisan
agreement that picks a debt-to-GDP safe point out in the
future, figures out how long it will take to get there, creates
that glide slope, creates alarm bells for that glide slope, and
then, in a bipartisan basis, you know, polices us towards a
safe and sustainable landing.
If we can do that, then I think we will have done the task
that the Budget Committee was originally established to do. Now
it is simply a support system for a reconciliation measure that
allows a simple majority for a pet political project of the
majority party, period, end of story.
For that, it is not worth keeping it. But I do think that
there is a step between getting rid of the damn thing and its
current parlous state where we can give it one last chance to
see if it can produce a sensible bipartisan result. And I would
like to hear Senator Corker's response to----
Senator Corker. Yeah. I think you may be putting off the
inevitable. But I want to say that you and Senator Perdue have
done great work together. You have very ideological--you all
are vastly different in your view of the world, and yet you all
have worked together to come up with some processes that I
think could well work.
With Senator McCaskill a few years ago, I introduced the
CAP Act, which capped spending at a percentage of GDP. And I
think you all are looking at something very similar as it
relates to total indebtedness. So, I would encourage this
Committee to look at the work the two of you are doing.
But everything has to be on budget, I think we would have
to agree. And the problem is, as you mentioned, we use
reconciliation with 50 votes, but it takes 60 votes in the
Senate to put policies in place. So, there is never policy
follow up to the budget proposals. I mean, just to talk about
my side of the aisle, when you do away with ACA but you keep
the revenues that ACA is generating, obviously, it is a hoax.
And the other side of the aisle does the same thing.
So, I hope that you will be very successful in this. This
is the greatest threat to our Nation. There has been a lot of
talk about the tax issues. And, obviously, from my perspective,
it could have been done a little bit better. Then we turned
right around and passed a spending bill that raises deficits $2
trillion over the next 10 years, and we don't even talk about
it. So, both sides are guilty of huge deficits. Both sides like
to spend money, just on different things. But the processes we
have will never, as they are now constructed, do the things we
want to do as a country.
So, thank you all very much, and thank you for your work.
Co-Chair Womack. Thank you, Senator Corker, for your
testimony this morning.
The next witness I would like to welcome, the ranking
member on the Defense Subcommittee of the House, Appropriations
Committee, distinguished gentleman from Indiana, Pete
Visclosky. Welcome, sir. The floor is yours.
Representative Visclosky. Chairman, thank you very much.
And I understand my entire statement is entered into the
record.
Co-Chair Womack. That is correct.
STATEMENT OF THE HON. PETER J. VISCLOSKY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF INDIANA
Representative Visclosky. I will begin by taking a
dangerous path in answering the question I have not been asked.
You asked the minority whip about possible incentives, carrots
and sticks, to have Members of Congress abide by some form of
discipline. I will suggest to you our incentive is our
responsibility to the next generation and have the discipline
to make the hard decisions that my parents' generation made for
me.
The second point I would make is I came here 41 years ago
and began my career as a staffer on the Appropriations
Committee. At this moment in time, I absolutely agree with
Senator Corker. If you would make one change tomorrow, I would
get rid of the Budget Act of the 1970s. The fact is you have so
few people--and think about your experience--on that Committee
who are charged with making the hard decision of raising
revenue, the hard decision of the expenditure of those revenues
in an effective and an efficient manner that people make
assumptions.
I am the ranking Democrat on Defense Appropriations. DOD
does not run on assumptions. It runs on hard decisions. There
is nothing in any rule today in either body that prohibits us
from getting our work done. And no rule or law we could create
is going to imbue Members of Congress with the political will
to act.
I do not believe our budget and appropriations process is
broken. Instead, it shows what happens when we avoid making
decisions in a disciplined fashion. Some would point to the use
of a 2-year deal, like multiple bipartisan budget acts of the
past half-decade. However, I would argue that moving to a
biennial budget does not fix the root cause of our
unpredictable funding timelines but simply creates severe risk
to good governance as it has become Congress' habit to only
pass bipartisan legislation on the eve of a governmental
crisis. Our problems do not lessen if we just drag out that
process for 2 years instead of 1. Agencies already tell us how
hard it is to execute funds when they receive appropriations 5
months late. Let's give them 2 years to drag this process out,
and it will simply give agencies more time to fill our request
with out-of-cycle demands.
Let us take the fiscal year 2018 Defense Appropriations
bill as an example. The House of Representatives voted for that
bill five times before it became law last March.
Representative Visclosky. It was comparatively painless for
Members of Congress. However, it wreaked havoc in the
Department of Defense.
Just one example. The National Guard exercises had to be
canceled, which affected over 102,000 service personnel.
There is nothing in the current rules that make this happen
except an absence of intestinal fortitude.
By potentially reducing the required interactions between
Congress and the executive agencies by extending the process to
2 years, we also sacrifice, I believe, the most up-to-date and
accurate information about how American taxpayers' dollars are
spent, relinquishing our specified constitutional
responsibility.
An example from this year. This year has brought several
executive branch trade enforcement changes, including tariffs
on steel and aluminum. These actions have resulted in
unexpected workloads for agencies. Both the House and Senate
Appropriations Committees have been in constant contact with
those agencies regarding the resources that are now needed to
effectively manage these immediate changes.
Regardless of what any of your position is on the tariffs,
I think we can all agree that effective management of policy
changes is key to the daily functioning of our government.
Let's change the rules and that is going to solve our
problem. We did that in 2010 with the Budget Control Act, and
we had sticks. Nobody in their right mind would allow us to
shut down the government or have sequestration. And the fact
is, on four different occasions since 2010 Congress has set
aside that act for 7 out of the last 8 years, because it does
not work.
We have our defense appropriations bill on the House floor
last night and today again. If we do not address that rule
change of 2010 between now and October, we have $71 billion
that are going to be taken off that budget for the Department
next year, so they are writing two different budgets.
The rule change certainly solved our problems.
I would simply say that the intervening 8 years have proven
that absent a commitment to governing in a sober, deliberative,
and well-intentioned fashion, this problem is not going to be
solved.
I believe we can solve the so-called budget problem if we
approach the appropriations process in a serious manner, if we
finally come together to meaningfully address entitlements that
now consume two-thirds of our budget and prevent investment in
the future and finally recognize, as my home State of Indiana
has done, that a reasonable amount of new revenue is necessary
if we are truly going to invest in the future of our children.
Thank you very much, Mr. Chairman.
[The prepared statement of Peter J. Visclosky follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I appreciate the gentleman from Indiana
for his testimony here this morning.
I am pleased to welcome our next witness. We had scheduled
in tandem both Rob Bishop of Utah and Devin Nunes of
California. I know Mr. Bishop has got other commitments this
morning.
So, we are pleased to welcome Representative Nunes from
California.
Sir, thank you for being here this morning.
Representative Nunes. Thank you, Mr. Chairman.
Co-Chair Womack. We will give you the floor for 5 minutes,
sir.
STATEMENT OF THE HON. DEVIN NUNES, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF CALIFORNIA
Representative Nunes. It is great to be here, and I will be
brief, but I will make my points. But I want to also add that
Mr. Bishop had a Committee hearing that he had to begin at 10
o'clock and he had to be there. That is why he had to leave.
But he is strongly in favor of this proposal that I am about to
outline for the Committee here.
This is something that I offered before the Republican
Conference began in the beginning of this Congress, and it
actually received 40 percent of the vote within our Conference.
I think it failed largely because people get used to sitting on
a Budget Committee, sitting on the Appropriations Committee,
and they didn't want to make change.
And, look, this is a big change that I am proposing here,
because it would essentially abolish all the Committees and
combine the authorizing Committees and the appropriations
Committees.
So, on the House side, which is what we would control, it
would create 14 appropriating and authorizing Committees. There
would be five select Committees. Every Member on the House side
would be able to choose two of those Committees.
And the Budget Committee would actually--you might like
this, Mr. Chairman, being Chairman of the Budget Committee--the
Budget Committee would become, I think, fairly powerful. It
wouldn't meet very often, but it would be made up of the
Committee chairmen and the ranking members, so that there was
actually real authority pushing that power down to the
authorizing and appropriating Committees.
One of the concerns that was raised at the time by some of
the Members when we lost that vote 60-40 in our Conference was
that a lot of our Members, even though knowing they sit on
three authorizing Committees with absolutely no power, some
didn't vote for it, because they said: Well, I am in line to be
Chairman of whatever authorizing Committee, even though I know
you are doing the right thing.
So, one of the things that we want to make sure of in this
proposal is that, whether you are on the Appropriations
Committee or their authorizing Committee, you would keep your
seniority and you would fall in line with whatever Committees
you fall under. So, there would have to be a fair process put
in place for that.
I will just close by another example just last night. I
chair the Intelligence Committee, and last night in the Defense
Appropriations Committee there are several provisions that
allow authorizing on the defense appropriations bill that will
be on the floor this week. And once again, that will happen,
despite the objections from myself and the members of my
Committee.
So, this is never going to get fixed until we decide to
pull it out by the roots and start anew. And I think that all
Members, at least on the House side--I can't speak for the
Senate side because I have never served in the Senate--but on
the House side I think it would really allow Members to
actually participate, hold the executive branch accountable,
have real power.
Because you guys may not admit this publicly, but I will
tell you that nobody in the executive branch takes any of us
seriously unless you are an appropriator and a senior
appropriator. If not, all they do is feed you a line, they know
they are going to wait you out, and nothing ever gets done.
So sorry for those of you who only serve on authorizing
Committees, but nobody really cares if you are here or not.
And with that, I will yield back.
[The prepared statement of Devin Nunes follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the gentleman from California for
his testimony this morning. Thank you, Devin.
Representative Nunes. Thank you.
Co-Chair Womack. Our next witness, the gentleman from
Pennsylvania, Representative Keith Rothfus.
Good to have you here, sir. The Committee looks forward to
your testimony. And the floor is yours.
STATEMENT OF THE HON. KEITH J. ROTHFUS, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF PENNSYLVANIA
Representative Rothfus. Mr. Chairman, thank you, Co-
Chairwoman, thank you for the opportunity to testify before
this Committee, and thank the members of this Committee for
this very challenging work that you have ahead of you.
Here in Washington we hear so much about how our system is
broken and Congress doesn't work, but I don't think we
understand how profoundly broken it is. In the over four
decades under our current budgeting process, Congress has only
passed all 12 appropriation bills on time four times. Think
about that. Failing to follow regular order isn't the
exception, it is the norm.
Due to this chronic failure, we in Congress are forced to
vote on massive omnibus packages and continuing resolutions,
often with very little time to read them. We are constantly
presented a false choice between voting on these cumbersome
bills or letting the government shut down. In effect, Members
are given 1 vote instead of 12 votes or even hundreds of votes
on the opportunity to offer amendments.
When we are voting on legislation hundreds of pages long
with very little notice, we cannot accurately represent what we
see in our districts. This haphazard budgeting process also
makes it virtually impossible to actually prioritize spending
in any meaningful way while our national debt continues to
explode.
Further, it seems every time we pass one of these
monstrosities, we hear about more provisions that seemingly
nobody knew were included.
This is absurd and needs to change. Issues should be
debated on their merits one at a time. We should have ample
time to dissect and read all bills considered. And we should
allow for feedback from our districts before taking the vote.
It is for these reasons in previous years that I introduced
the Pay for Performance Act. This legislation would have
withheld pay for either Chamber if they failed to complete all
12 appropriation bills on time.
There may be a better way to incentivize these bodies to
get their work done. Perhaps no August recess until
appropriation bills are done.
We need an incentive like this to get our process back in
order. Or maybe we need a new process entirely. Either way, a
90 percent failure rate is unacceptable by any metric and we
should demand better.
Government is going to be funded, we know that. If it is
not going to be funded on September 30, it is going to be
funded by October 20 or November 18 or December 22 or February
18. This is an act of the will.
We know deadlines are coming. Every taxpayer in this
country knows that April 15 they have to file something. Even
if they have to file an extension, they have to pay taxes too.
We know government is going to be funded. There is no
reason why we can't get this done by September 30.
I sincerely thank everybody for this work that you are
undertaking. I encourage you to look at this from different
angles. I was just listening to Chairman Nunes and his
suggestions.
We have 12 appropriations bills that lump different
agencies together. Is that the best practice? You need to take
a look at that.
Should there be more types of bills? We can vote on these
things.
You take a bill, the one we considered last week where we
did--or a couple weeks ago when we did the minibus, or even you
look at something like the Labor-HHS, which combines three
agencies. Should these be divided further?
We also need a process where we can be having discussions
about some binary choices and prioritizing. That is what
families around this country do around the dinner table. If you
have an emergency at home, you might have to put off resealing
the driveway so that you know that the lights are going to stay
on or the plumbing stays on.
We need a mechanism of some sort where if we want to
increase funding in one area, we should be able to ask that
that could come from another area, and it shouldn't necessarily
happen in the same appropriations bill. There may be something
I want to propose for an increase in Labor-H, but I would want
to pay for it out of another bill. There is no mechanism to do
that.
So, again, I applaud this Committee for the work that you
are undertaking. I encourage you. And I look forward to further
interaction with this Committee and I look forward to your
reports.
Thank you.
[The prepared statement of Keith J. Rothfus follows:]
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Co-Chair Womack. Thank you very much, Representative
Rothfus, for your testimony this morning.
We are going to stay in Pennsylvania. Our next witness is
Representative Lloyd Smucker from Pennsylvania 16.
Representative Smucker, we appreciate the opportunity to
hear from you this morning. The floor is yours.
STATEMENT OF THE HON. LLOYD SMUCKER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF PENNSYLVANIA
Representative Smucker. Thank you, Chairman Womack and
Chairwoman Lowey, Members of the Joint Select Committee on
Budget and Appropriations Reform. Thank you for the opportunity
to testify before you today.
First, I would like to begin by extending my sincere
appreciation for the work of this select Committee. You all
have been tasked with accomplishing an incredibly important
job, fixing the broken Federal budget process.
As a freshman member of the House Budget Committee, I have
received quite an education over the last 18 months about how
we conduct business here in Congress. We lurch from one CR to
the next, an average of four per year. Since our budget process
was last overhauled in 1974, the government has been shut down
more than 20 times. In fact, the 12 required appropriations
bills have passed on time just once in 43 years.
Particularly when contrasted with my experience as a
business owner and then as a State legislator in Pennsylvania,
I think it is fair to say that the wheels have completely come
off our annual budgeting process. But you already know that and
you know the results: a crushing debt that threatens our
security and our economic vitality, a system that is failing
the American people, and a rather bleak outlook for our kids
and grandkids if we can't change the trajectory.
We come here to solve big problems, and it is not too late
to place this country on a sound fiscal path. We can do it and
we must.
I have come to believe that it must start with reforming
the process. We must reform the budget process and reform the
way Congress works to achieve the results that we need. And I
also happen to believe that this commission is our best
opportunity in a long time to do so.
My purpose today is to share the experience of a commission
in the Pennsylvania Legislature that worked, that took on a
similar systemic long-term problem and found solutions.
In fact, it had worked so well that I thought it was a good
model to tackle budget reform and before the establishment of
this select Committee had introduced legislation that would
have established a similar joint commission.
My hope is that sharing how it worked in Pennsylvania will
spark a few thoughts or ideas that could be useful to you in
your work and your ultimate success.
So just a little background. The Committee in Pennsylvania
was the Basic Education Funding Commission and it was tasked
with determining a new formula to distribute education dollars
to 500 districts all across the state.
Everyone agreed, similar to what we have here, that the
current system was completely broken, but multiple attempts to
fix it over a period of 30 years had produced absolutely no
results.
The Commission was formed, worked for about 16 months, then
provided a unanimous recommendation, which was taken up by the
legislature, then passed and signed into law by the Governor.
As chair of the State Education Committee at that time, I was a
member of the Commission and sponsored the final bill.
Several things about the Commission were important and may
be helpful. The makeup of the Committee was important. It was
bipartisan and bicameral. It was an inside Committee like this,
three members from each party and each house, including the
chairs of the relevant Committees. It also included three
members of the executive branch, including the Budget Secretary
and the Education Secretary. All of the key decisionmakers were
in the room and were included in the process.
The process itself was equally important. All deliberations
were open and were transparent. And in our case, we held
multiple hearings across the State, inviting anyone who wanted
to participate to testify and provide input, including experts
from other States, educators, and even members of the general
public. That not only provided the best thinking available, but
also created a loud echo chamber across the State and by and
from all stakeholders.
Remarkably, the work of the Commission in Pennsylvania
spanned two administrations, Republican and Democrat. Members
from the executive branch changed midway through the process.
Even so, the recommendation was unanimous and was fully
endorsed by the new Governor.
Sticking to the original purpose of the Commission was also
critical. It was tasked with finding a formula, but during
hearings received a lot of pressure to increase the scope of
its work. We worked really hard to keep the goal narrowly
focused on the specific problem that we wanted to fix.
While your commission may not be designed in exactly the
same way as ours in Pennsylvania, I know it can work and that
you can make a difference. I applaud you for your work and
believe this is the best opportunity we have to fix the broken
Federal budget process and deliver real systemic and meaningful
budget reforms.
I look forward to the work that you are doing and to
supporting you in the best way that we can in the legislature.
We share a common goal of wanting to fix the troubled state of
our Nation's fiscal health, and that starts with reforming the
broken Federal budget process.
Thank you.
[The prepared statement of Lloyd Smucker follows:]
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Co-Chair Womack. Thank you, Representative Smucker, for
your testimony this morning.
Our next witness is the gentleman from Ohio, Representative
Warren Davidson.
Representative Davidson, the Committee appreciates the
opportunity to hear from you this morning. And with that, the
floor is yours. Please engage your microphone. And you have got
5 minutes for testimony.
STATEMENT OF THE HON. WARREN DAVIDSON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OHIO
Representative Davidson. Thank you, Chairman, and thanks to
the full Committee. I really appreciate your attention to this.
And we are all in the same boat, but you guys are doing the
work.
I really could spend the whole time talking about how
important it is to move past the broken Budget Control Act of
1974 and to do just really basic things, like have a meaningful
Gantt chart that shows what can happen in parallel and what can
happen sequentially, so that we get our work done on time, as
the country should expect us to do.
I couldn't emphasize how important it is that we put
everything on appropriations, not just some things, and the
autopilot has got us headed for a crash.
But one of the more meaningful things that I think we could
do in reform is to understand how our accounting department
works.
Essentially, the Congressional Budget Office serves as our
accounting department. Each of us doesn't have one of these
functions in our office. And, unfortunately, most of the time
we don't even, as individual Members, have access to real
reports from accounting. They might give us the final summary,
but they won't show us the details.
And so, I think the Congressional Budget Office should
fully embrace our Show Your Work Act, and I ask that you would.
I have received some feedback about some concerns and would
love to try to address a few of those. For background, the
Joint Select Committee on Budget and Appropriations was
established by this act. So, we have got a process to review
things.
The CBO has an incredibly important role in providing
budget and cost analysis for legislation in Congress. Given the
weight of these scores Members of Congress have to use for
policy decisions, it should be a top priority that CBO
standards are of the highest possible quality so that they may
provide the best possible analysis for policymakers.
When CBO fails to accurately predict the impact of
policies, legislators lack the resources to make educated
decisions.
Examples include healthcare. Upon passage of the Affordable
Care Act, CBO projected 21 million people would be enrolled in
the exchanges in 2016. In reality, roughly 10 million people
signed up, making for an overshot of 120 percent.
In the healthcare debate in 2014, CBO predicted Medicaid
expansion would cost $42 billion in 2015. The reality was $68
billion, about 62 percent higher.
And most recently on tax reform, projected that the economy
would only grow by 0.4 percent extra because of tax reform. We
see the results are meaningfully different than that.
So, what the legislation does is it requires CBO to publish
online all data, models, and processes utilized in their
analysis and scoring. It specifies that data and information
provided must be sufficient so that individuals outside of CBO
can understand, replicate, and reproduce the results found
within. Essentially, this is the same thing that academics
expect and it would come with some of the same safeguards.
CBO should not be allowed to disclose certain datasets.
Instead, they would publish a complete list of data variables
for that data, including descriptive statistics, averages,
standard deviations and correlations, a reference to the
statute or rule preventing them from disclosing, for example,
personally identifiable information, and the contact
information for the individual or entity that has unrestricted
access to the data.
So, for example, we wouldn't need to know the contents of
everyone's tax return or, frankly, the detailed pricing of any
one pharmaceutical. We would need to know aggregate data to be
able to simulate the model. We might not need to know how an
individual company priced their drugs to model prescription
drugs, for example.
The bill is very important because it would allow the same
sorts of review that go on in normal companies. Accounting
departments have healthy debates. They have accountability that
comes from the board questioning the accounting department.
If you ask a leader of a business unit how to steer the
business unit, it is unfathomable that the leader of that
business unit wouldn't be able to go to the accounting
department and get a detailed answer as to why that was the
cost model if you tried to apply this to the corporate world.
I believe we are owed it, as Members of Congress,
individual Members, and I certainly believe that the American
people are owed it. And I hope that you can find a way to
address the concerns that have been expressed that are valid
about how to protect personally identifiable information or
proprietary information.
But the American people need to know how our accounting
department derives their recommendations so that it can be
truly respected as the nonpartisan entity that it is.
Thank you.
[The prepared statement of Warren Davidson follows:]
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Co-Chair Womack. Thank you, Representative Davidson, for
your testimony this morning.
Our next witness is Representative French Hill, my
distinguished colleague from Arkansas, a member of the
Financial Services Committee.
The gentleman from Arkansas is recognized for 5 minutes.
STATEMENT OF THE HON. J. FRENCH HILL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ARKANSAS
Representative Hill. I thank the Chairman. I congratulate
the Chairman on a great victory by Arkansas last night in his
district. I know he stayed up late watching that game.
Co-Chair Womack. Go Pig Sooie.
Representative Hill. My best wishes to the ranking member,
members of the Committee.
Experiencing frustration and dissatisfaction with the
actual functioning of the Congressional Budget Act of 1974 is
not new or remotely original. This Committee's shelves are
stacked with binders of worthy and not-so-worthy suggestions
from four decades of bipartisan complaining.
My first exposure to concrete recommendations for wholesale
change came from my former boss on Capitol Hill, Senator John
Tower of Texas, an original member of the Senate Budget
Committee and Chairman of the Senate Armed Services Committee.
Senator Tower offered his restructuring proposals in his
1991 memoir ``Consequences.'' He argued strongly for a 2-year
budget cycle to get off the budgetary treadmill, and he argued
that there be less executive branch testimony before
authorizing, appropriating, and budget Committees by
streamlining that witness approach.
In the last two decades, Congress' budgetary muscles have
atrophied, rarely completing a budget or passing appropriations
measures prior to fiscal year ends. It is really sad how little
that has happened since 1974. Gosh, not since 1996, and that is
back when Vice President Gore was still inventing the internet.
The results. The administrative state has grown unwieldy
and more immune to oversight. In Article I, the Congress'
appropriation oversight responsibilities are their most
fundamental. The debt has grown unabated, with the burden of
net interest that is expected to soon reach more than the
entire appropriation for defense, and by 2027 reach
approximately $1 trillion, the approximate size of today's
entire discretionary budget.
The government is run from one dysfunctional CR to another,
periodically punctuated by an unaccountable omnibus
appropriation that pleases no one.
All the while, mandatory spending programs grow at three or
four times the rate of macroeconomic growth, with little public
discussion or oversight and rarely, if any, votes being held
for restructuring in the Congress.
So, what to do?
Let me first endorse fully, Mr. Chairman, the 2-year budget
cycle for annual budget resolutions and having a 2-year
spending allocation under that resolution. Watching the House
move all 12 appropriations bills last summer in a 120-day
period made us all realize that our muscles can be strengthened
and we can do that, and I commend Senator Shelby's work as well
this year. So, I think the 2-year cycle is good.
Unauthorized programs. You know, in business, where I spent
three decades, this kind of thing just wouldn't even be
considered in the real world. Establishing a budget procedure
whereby spending is reduced by the amount of excess
appropriations for unauthorized programs would be a worthy
change. Thus, the Committees--the authorizing Committees would
not fund--appropriations Committees would not fund unauthorized
or expired programs.
Likewise, all authorizing Committees would file their views
and estimates, including a list of every program about to
expire or that required reauthorization, and use a zero-based
budget justification for every program so identified.
I have a list of things that I entitle, Mr. Chairman, Stop
Kidding Ourselves:
Number one, prohibit budget gimmicks.
Stop Committees from using one-time shifts in timing or
asset sales to offset ongoing spending increases.
Permit any Member to offer an amendment to strike emergency
spending designation in any measure.
Insist that the Congressional Budget Office and the Office
of Management and Budget baseline budget eliminate their built-
in discretionary inflation, automatic extensions of expired
programs, and that mandatory spending programs continue at
current levels even when trust funds are insolvent.
On better transparency, I think every fact sheet by the
Budget Committee and the Appropriations Committee for all
Members and Senators should propose plainly what the outlay is
for the proposed fiscal year compared to the past 5 years of
actual outlays, noting the percentage increase and decrease.
All Federal insurance and retirement programs, excluding
Social Security, ought to be put on accrual budgeting,
requiring the Congress to fully budget all the costs in those
programs.
And finally, Mr. Chairman, I really think that Tom
McClintock's Default Prevention Act, which requires the
Department of Treasury to continue to borrow to pay the
principal and interest on certain obligations if the debt
exceeds its statutory limit, is a worthy change that this
bicameral Committee ought to recommend. I think it will take
off the table the periodic debt ceiling limit that causes our
debate to not be as positive as it could be.
And finally, a regulatory budget. I hope that you will
consider a regulatory budget in addition to a budget
resolution.
And I thank you for the time to testify.
[The prepared statement of J. French Hill follows:]
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Co-Chair Womack. I thank the gentleman from Arkansas for
his testimony.
We are going to hear from one more witness, then we are
going to take our promised break, albeit about 15 minutes late.
The gentleman from Ohio, Mr. Jim Renacci.
Representative Renacci, we are pleased to have you this
morning. The floor is yours.
STATEMENT OF THE HON. JAMES B. RENACCI, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OHIO
Representative Renacci. Thank you, Mr. Chairman. I want to
thank the co-chairs of the joint select Committee for holding
this hearing and allowing Members of Congress to share their
ideas and proposals.
Look, I got here 7\1/2\ years ago as a business guy who
balances budgets, who makes things work, and who continues to
believe we need budgets. The problem is our budgetary system is
broken.
I have spent a lot of time since being elected here of
looking at financial processes, everything from how we can
develop a financial statement to how we can develop a process
where we can start with a budget.
But let's first say you can't even prepare a budget if you
don't know where you are at. And one of the biggest problems I
said in Washington is most Members of Congress don't really
know financially where we are because we don't have a fiscal
accounting, we don't have a fiscal financial statement, and we
don't have a fiscal address.
So, what I am proposing is two bills that actually I think
fix the budget process.
Number one, you first have to have awareness. I believe it
is critical the American people and Congress are aware of the
financial system that our country faces. So, I have introduced
a bill that would just do that. It is pretty simple. All it
does is require the Comptroller General of the General
Accounting Office to provide a fiscal state of the Nation
address to a joint session of Congress on an annual basis.
The presentation would include an analysis of the condition
of our country's fiscal status, including our budget deficits,
long-term fiscal projections for our social insurance programs.
It would be a presentation of our fiscal issues, and it would
be public for all Americans.
Right now, our country is on the cusp of a national debt
crisis. By 2023, the CBO projects that we will spend more
paying down our interest than we will on our national defense.
By 2028, the debt held by the public as a share of GDP will
increase to 96 percent, the largest since 1946.
Most Members of Congress don't know that. By the way, I
have also said that every Member of Congress should be on the
Budget Committee at least one cycle. Most Members of Congress
are not aware of that. And as lawmakers, we have a moral
responsibility to address these changes and work together to
find bipartisan solutions to stave off this pending crisis.
A strong first step would be requiring Congress to come
together once a year to hear from a nonpartisan Comptroller
General what the fiscal state of the country is in order to
highlight the crisis that we face and put Members on notice to
the public that this is an issue that needs to be addressed.
The best way to tackle a problem is to first shine light on
the problem. At my request, the Comptroller General has
testified before the House Budget Committee in recent years,
and I believe that this issue is too important that the full
Congress not be made aware of it.
Some will say a joint session of Congress is not the right
venue for this type of speech. I would highly disagree. I would
counter by asking doubters why they believe this isn't an
important enough issue to convene a joint session and why they
are afraid to set the new precedent.
I had almost 200 cosponsors on this bill the first time I
dropped it last cycle. This cycle I am close to getting 200
bipartisan Democrats and Republicans who agree to this. We
shouldn't be afraid of doing it.
Additionally, the legislation was included in the 2016
Budget Committee budget reform white paper, has been endorsed
by the Committee for a Responsible Federal Budget, the AICPA,
the Concord Coalition, and the National Taxpayers Union.
It is something we should not be afraid of. It is something
we should be looking forward to seeing every year so we know
where we have to start before we do the budget process.
Along with that awareness, I think we need to do a better
job at holding ourselves accountable. The second bill I have
introduced would make Congress actually abide by the budget
that we pass. Since 1974, we waive our budgets. Every time we
turn around, it gets waived in budget--in the Committee that--
anyway, it gets waived, and that is a problem. We can't waive
the Committee.
Too often, the Rules Committee waives budget-related
issues, preventing Members of Congress to object to legislation
that breaks the budget.
If you want to break the budget, that is all well and good.
In the business world, you break it all the time. But what you
do is you come before management, which is the Congress, and
you tell people why.
This bill would allow Members of the House to call for a
recorded vote on these waivers and put Members on the record
whether they wish to waive the budget.
As someone who has spent my career in the business world, I
believe it is important that we pass a budget and follow the
budget. This bipartisan legislation would hold Congress
responsible to ourselves and ensure that we actually follow our
budget.
I commend the work that the Joint Committee is doing in
reforming our broken budget process. I believe that these two
measures that I discussed today should be considered as part of
the broader reforms that are needed to fix the budget process.
I want to thank you again for your time. And I yield back.
[The prepared statement of James B. Renacci follows:]
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Co-Chair Womack. I thank the gentleman from Ohio for his
testimony this morning.
Our next witness is here, but we have promised our
Committee that we are going to take just a few-minute break for
a comfort break, check email, make whatever phone calls you
need to make.
So, at this time, if it pleases the co-chair, I think we
will take a break and resume our testimony at 5 till the hour.
That would be in about 11 minutes.
So, the chair declares this Joint Select Committee on
Budget and Process Reform for Members' Day to be in recess for
about 10 minutes.
[Recess.]
Co-Chair Womack. The Joint Select Committee on Budget and
Process Reform Members' Day will resume.
The co-chair and I do appreciate the cooperation and the
participation of our Members of the Committee and those Members
that are making presentations here today.
We are running just a few minutes late. We do appreciate
the patience of our next witness, Ms. Jayapal. And we will
proceed now with her testimony and then go straight toward the
end, in hopes of getting us back a little bit more on time,
although running about 15 minutes late is about on time for
Congress, in my opinion, based on my experience.
But nonetheless, our next witness is Pramila Jayapal from
Washington. And the gentlelady is recognized for 5 minutes in
support of her positions on this subject.
And the floor yours, Ms. Jayapal.
STATEMENT OF THE HON. PRAMILA JAYAPAL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF WASHINGTON
Representative Jayapal. Thank you so much, Chairman Womack,
and thank you to Chairwoman Lowey as well, for holding this
hearing and for all your dedicated work.
Since I have come to Congress, I have heard a lot of talk
about the budget process being broken. And as the vice ranking
member of the House Budget Committee under the great leadership
of Mr. Yarmuth, I have been able to look at the process up
close and consider how we use it.
What is obvious is that there is a process on the books
that has the promise of being able to be used effectively, but
in reality, it has been thwarted time and time again.
As a Budget Committee member, I plan to focus my remarks
today on the Budget Committee's role. And first I would like to
give a little bit of context.
The budget resolution process was designed to give Congress
a voice in setting fiscal policy. And prior to the enactment of
the Congressional Budget Act of 1974, which established the
Budget Committees as well as the Congressional Budget Office,
Congress did not have its own source of budgetary information
and didn't have a procedure to establish an overall fiscal
framework.
Rather, the executive branch housed budgetary information
and was the only source of a fiscal plan. Congress acted on
that plan in a piecemeal fashion, with each Committee reviewing
proposals in its jurisdiction. There was no approval of overall
levels of revenue, spending, and the resulting deficits and
debt.
Clearly, that was not a good way to budget. Revenue and
spending decisions should not be made in separate silos. Each
has an impact on deficits and debt. Changes in one are going to
fundamentally require changes in the other, a change in the
overall fiscal path, or both.
And a perfect example is the recent tax bill. The
Republican majority made a decision to cut revenue
substantially, even though long-term deficits were already
unsustainably high. That was then used to justify calls for
even deeper spending cuts. And it had severe consequences for
Americans across the country, who are struggling to make ends
meet, to pay for healthcare, or even to put food on the table.
The good news is that the budget resolution can and has
been used to lay out a framework of priorities. Used properly,
the budget resolution provides a way to lay out Congress'
priorities, both for overall fiscal policy and for distribution
across major functions or areas of national need.
The reconciliation process provides a path to enact
spending cuts or revenue increases included in a budget
resolution that might require difficult votes. Major deficit
reduction packages that implemented policies assumed in the
budget resolution have been enacted, including those during the
Clinton administration that led to budget surpluses.
The budget resolution should and has set the stage for the
Appropriations Committee to do their work.
But sadly, the budget resolution has become only a
messaging document rather than a governing document. It has
incorporated policies that the majority doesn't actually plan
to move during the upcoming year.
And, for example, in recent years, trillions of dollars of
savings are called for in the resolution, but are not included
in the reconciliation directives.
That is the mechanism to enforce the cuts. It is called
reconciliation because the whole point of the process is to
reconcile Federal law with the amounts assumed in the budget
resolution. Failing to reconcile trillions of dollars in cuts
suggests that the cuts are not meant to be real.
Likewise, discretionary spending has been put at
artificially low levels, even though there is widespread
agreement that higher levels will be needed.
Much of the savings in both categories has been
unspecified, meaning that it is impossible to tell from the
budget resolution what Congress' true priorities are. Revenue
cuts have been sold as likely to cost nothing, even as the
Joint Tax Committee's best estimates show that is not the case.
None of this engenders respect or credibility for the
process or for those of us who serve in Congress.
It is time for all of us to step up and recognize that we
can do better. The budget resolution process has a means to
define what we want fiscal policy to be and a set of
enforcement procedures to help us get there.
There may need to be improvements to the process that can
help make things move more smoothly, and we should welcome
them. But realistically, we can't expect them to fix this.
Rather, we need to approach the process with a realistic
understanding of what we can do, a willingness to compromise
when necessary, and a readiness to accept analysis on what
policies will cost and save produced by our own in-house
nonpartisan experts. If we don't do that, we have ourselves to
blame for not being able to muster the resolve to use the
process that we have efficiently.
I thank you very much for your work and for your focus on
this issue.
[The prepared statement of Pramila Jayapal follows:]
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Co-Chair Womack. I thank the gentlelady from Washington for
her testimony this morning.
Our next witness is Representative David Price from the
great State of North Carolina.
Representative Price, we appreciate you appearing before
the Committee this morning. And the floor is yours, sir.
STATEMENT OF THE HON. DAVID E. PRICE, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NORTH CAROLINA
Representative Price. Thank you, Co-Chair Womack and Co-
Chair Lowey and other members of the select Committee. I
appreciate the chance to testify today, and I will submit the
full copy of my text for the record.
I have been following the work of this Committee and like
much of what I have heard. The possibility of ending debt
ceiling brinksmanship, for example, or moving to a calendar
year budget cycle.
But one of the ideas you are considering has set off alarm
bells, and for that reason I would like to take a few minutes
to detail my objections to a bad idea, namely, moving to a
biennial appropriations process.
I first testified about biennial budgeting about 20 years
ago before the House Rules Committee, which was considering
legislation to transition Congress to biennial appropriations.
Then our fiscal situation was quite different. The
enactment of comprehensive multiyear budget agreements in 1990,
1993, and 1997, coupled with a growing economy, had produced
several years of balanced budgets. In fact, we had been able to
pay off $400 billion of the national debt.
Since then, we have had two unpaid-for wars, unnecessary
but expensive countercyclical response to the Great Recession,
massive unpaid-for tax cuts, and now 7 years of extremely
partisan and largely dysfunctional congressional budget
politics.
So, it is understandable that the idea of biennial
appropriations would once again hold some appeal as a panacea
for Members in search of solutions to our current woes. But
this is truly a case in which the remedy would be worse than
the disease.
Of course, I understand the congressional budget and
appropriations process have eroded significantly. The pressures
of divided government and a polarized electorate, the increased
use of the Senate filibuster, the general subjugation of
Congress' constitutional power of the purse to partisan
political considerations, all of these factors have greatly
delayed the enactment of our annual spending bills and
increased our reliance on continuing resolutions and omnibus
packages.
But biennial budgeting, by which I mean biennial
appropriations, would do nothing to address the underlying
causes of this dysfunction. It actually might make matters
worse by weakening congressional oversight of the executive,
jacking even more decisions up to the leadership of both
parties, and increasing our reliance on supplemental
appropriations bills considered outside the regular order.
I want to stress that these same arguments do not apply to
a multiyear budget agreement of the sort that served us so well
in the 1990s, nor do they apply to a 2-year budget resolution
of the sort Congress passed a few months ago. Indeed, our
current appropriations work is greatly facilitated by the fact
that that is a 2-year plan.
But appropriations is another matter. The thorough review
of individual agency programs and the determination of new
funding levels must have year-to-year flexibility and is
distinct from determining budgetary topline numbers.
My arguments this morning are directed to the 12
appropriations bills that must be passed under any budget
agreement, no matter the duration of that agreement.
Now, proponents of biennial appropriations claim that it
would free up Congress to conduct oversight in the off-year.
That is a supremely ironic claim, for the most careful and
effective oversight Congress does is through the annual
appropriations process, when an agency's performance and needs
are reviewed program by program, line by line. Off-year
oversight would be less, not more effective, because it would
be further removed from actual funding decisions, reducing
Congress' leverage.
As the ranking member of the House Appropriations
subcommittee on Transportation and Housing, I have seen
firsthand the value of annual appropriations bills and how it
bolsters congressional oversight.
For example, last year the Federal Transit Administration
made several administrative and policy changes, procedural
changes to the capital investments transit program, the New
Starts program. State and local agencies faced considerable
uncertainty about how their projects would be reviewed and
whether they could count on Federal funding commitments.
Members of both sides of the aisle reached out to the
Appropriations Committee with their concerns.
So, in response, our Committee included several provisions
and report language in the fiscal year 2018 omnibus
appropriations bill on a bipartisan, bicameral basis, directing
FTA to provide grantees with updated project ratings and to
administer the program in accordance with the law.
What if we had had to wait an additional year to do that?
To wait an extra year to enact these policy provisions might
have resulted in the failure of several large transit projects
across the country. And the ability of the Committee to quickly
respond to executive branch action proved decisive.
Annual appropriations bill also serves as a way to respond
to court rulings that may invalidate or make workable existing
policies. They facilitate other policy tweaks that would
otherwise fail to garner floor time. These housekeeping items,
as we call them, almost always are dealt with on a bipartisan
basis and they are vital to ensuring the effective function of
government.
A biennial appropriations process would also pose special
challenges during the second year of the 2-year budget cycle.
Just think about this. Under the existing appropriations
cycle, Federal agencies typically begin formulating their
budgets in the summer of the year before the President submits
his budget request to Congress in February. That is a full 14
to 15 months in advance of the start of the actual fiscal year.
Now, if you ask agencies to put a budget request for the
second year of a 2-year cycle forward, as much as 28 months in
advance, that would require a level of planning and foresight
that just might not be possible or realistic given the
uncertainty of revenue and expenditure projections, the
continually evolving challenges of the Federal Government.
For example, the Tenant-Based Rental Assistance Program,
often referred to as Section 8 vouchers, at the beginning of a
cost cycle we receive estimates from HUD regarding renewals.
Co-Chair Womack. The gentleman is running out of time. Your
time has expired.
Representative Price. All right. I will leave the Section 8
example for the record and wrap up, Mr. Chairman.
What I am saying, though, pertains to the second year of an
appropriations cycle. And I just think we would have more
supplemental appropriations bills, more reprogramming, and all
the rest.
So, in conclusion, the whole purpose of the biennial budget
could be undermined by the proliferation of supplementals in
the off-year. Perversely, we would have replaced the
deliberative and democratic process of appropriations with
supplemental bills that are sporadic, rushed, and heavily
controlled by leadership.
So, I don't think biennial appropriations is any better an
idea today than it was 15 or 20 years ago. It would be a
mistake to let recent budget disagreements lure us toward a
supposed remedy that would actually make appropriations less
systematic, less flexible, and less potent.
We all know that the process has broken down, but biennial
budgeting fixes none of this.
Thank you, Mr. Chairman.
[The prepared statement of David E. Price follows:]
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Co-Chair Womack. Thank you, gentlemen, for your testimony
here this morning.
I am going to allow the co-chair to make a statement.
Mrs. Lowey.
Co-Chair Lowey. Thank you very much.
I just wanted to comment quickly on your presentation,
perhaps because I agree with you 100 percent. And I think you
present very carefully crafted arguments, and I know that your
testimony will be an important part of the final record that we
will review as we are making decisions.
So, I just wanted to thank you again for the careful
preparation of your presentation. Thank you very much.
Co-Chair Womack. I thank the gentlelady.
And as is the case with all Members, written statements
will be made a part of the official record of this event today.
Thank you, Representative Price.
Our next witness is the gentleman from Montana, the Senator
from Montana, Steve Daines. Mr. Daines will have 5 minutes for
his presentation.
Co-Chair Womack. The joint select Committee appreciates the
time that you have taken to appear before the Members' Day
program here this morning, and we will give you the floor, sir.
STATEMENT OF THE HON. STEVE DAINES, A UNITED STATES SENATOR
FROM THE STATE OF MONTANA
Senator Daines. Co-Chairs Womack and Lowey, thank you for
your leadership and for giving us this Members' Day. It gives
us an opportunity to share our experience on how to improve the
very broken budget and appropriations process.
I serve on the Appropriations Committee of the United
States Senate. So, my remarks are somewhat framed in my
experience of about 3 years in the Senate. I also want to thank
Senator Perdue for his commitment to reform the budget process.
David and I have been working a lot before the select Committee
was put together. I am grateful for it. Thank you for elevating
it to this level.
Many of the Members currently serving in Congress come from
business backgrounds, and I think we can take some of that
experience. It is not the only experience that is going to help
in this area, of course, but it will help us, I think, to frame
a better process going forward.
This process is incredibly broken, and so it should be no
surprise that a profoundly broken process delivers a very bad
result. Having spent 28 years in the private sector, passing a
budget is not optional. You must pass a budget. In fact,
passing a balanced budget is not optional. You must do that as
well, or else you are out of business. $21.1 trillion of debt,
$33.8 trillion of debt in 10 years, we have no option but to
change the budget and the appropriations process.
I just want to jump right into policy. I am going to try to
remove the bun and get to the meat here.
Let me share four recommendations that I have for this
prestigious select Committee. First of all, I would combine the
authorizing Committees with the corresponding Appropriations
Committee. Consolidate them and then completely dissolve the
Budget Committee. By doing this, we can start having real
conversations about where to spend and how to spend it.
Currently, we have two processes on different tracks that
simply don't sync up. Integrating the processes into one
Committee will ensure more coordination and better outcomes.
The biggest single challenge to doing that will be leadership
itself in these Committees.
Members stay here for a long time. They get to Committee
chairs. That, I think, will be the single greatest barrier that
we will face in trying to implement that reform. But I think
Senator Perdue and others have shown this incredible spaghetti
tangle of authorizing Committees and Appropriations Committees.
And then we have this Budget Committee on top of that, and it
is no wonder this process produces a bad result. It is very
complicated, and it is not unified. I think we could
significantly improve this process by dissolving the Budget
Committee, bring authorizing and Approps into single Committees
that line up with their respective jurisdictions.
Number two, the budget should be a law, not a resolution.
We need to have an up-or-down vote on the entire budget, one
number. One number that includes discretionary and mandatory
spending. In today's terms, that means we would be voting on a
roughly $4 trillion spending budget, not $1.2 trillion in
discretionary.
Number three--and I respectfully heard Representative Price
and his views on biennial budgeting. I think we need to take a
look at, and I will tell you why. I am a subcommittee chair on
Approps. I believe that by budgeting over a longer period of
time, it can make the process and outcomes more predictable for
all stakeholders. This removes some uncertainty for Federal
agencies and adds much-needed capacity to the Senate. I don't
know if that has been talked about a lot. But one problem we
had in the U.S. Senate is floor time. And the appropriations
process we have today would consume a lot of that Senate
capacity. A biennial budget actually frees up more capacity for
the Senate to do the work of the people. You are much more
efficient in the House than we are in the Senate. You guys get
a lot better gas mileage.
Fourth, we need to create incentives to pass a budget. I
think we should look at both carrots and sticks. If any of you
have served in State legislatures--I have not--but I think 46
out of 50, conservatively, some say 48 out of 50, require a
balanced budget. We should look at that for Washington, D.C.,
as well.
But at a minimum, as we see--I know in the State of
Montana, they don't get to leave town until the budget is done.
And so, there is an incentive to keep members there until they
actually get the budget completed. But I think we are going to
put something here that compels this organization, this body to
do it.
I do think by moving forward on some of these ideas, we can
fix this. We need to fix it. I know there have been many
efforts--you know this--and failed attempts to reform the
budget process. I hope it doesn't go down in history as one
more failed Committee that came up with recommendations and
nothing was done.
I sincerely believe this is the number one reform facing
Congress. I don't think there is anything more important than
what you are doing right here. I think truly this is the most
important work we can be doing at the moment.
We need to act. No more CRs. No more omnibuses. Failure is
not an option.
Thank you for holding this session today and allowing me to
share my thoughts.
[The prepared statement of Steve Daines follows:]
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Co-Chair Womack. Senator Daines, thank you very much for
your testimony this morning.
Our next witness hails from the State of Alabama. We are
going to provide 5 minutes of testimony from Representative
Robert Aderholt.
Representative Aderholt, the Committee appreciates your
time this morning. Look forward to your testimony. The floor is
yours, sir.
STATEMENT OF THE HON. ROBERT B. ADERHOLT, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ALABAMA
Representative Aderholt. Thank you, Mr. Chairman. And
thanks to the co-chairs for an opportunity to speak. And also
to all the members, thank you for allowing Members to come and
address the Committee today.
Let me start by saying that I welcome today's discussion
and opportunity to engage with members about the ways that we
can make rule changes that improves our budget and
appropriations process. The fulfillment of Article I, section
9, clause 7 to responsibly oversee spending of public funds is
one of the most crucial and necessary tasks that are executed
by the Federal Government.
Serving now in my 22nd year on the House Appropriations
Committee, I have reviewed the process extensively. I have seen
it in work over the years as I have served the people of the
Congressional District, Fourth Congressional District in
Alabama. With the trend of stopgap funding bills and government
shutdowns, in this environment, there is a lot that we can do
to ensure the American people that they are receiving effective
government that they deserve. The work of passing 12 individual
appropriation bills through the subcommittee, through the full
Appropriations Committee, and then on the floor of each Chamber
is a challenging process. It requires consensus and certainly a
lot of hard work by a lot of people.
The House Appropriations Committee has had dozens of
hearings, met with administration officials to hear the budget
justification. We have moved through the subcommittee process,
the full Committee process with bipartisan agreements on much
of the content that is in these funding bills.
In recent years, the House has been able to consider and
pass bills through this process despite the challenges that we
have seen in the Senate. This has caused Congress under the
leadership of both Republicans and Democrats to use combined
spending packages as a way of forcing funding through the
process. However, the status quo is not working, and I think
that is what you are hearing from a lot of our colleagues
today.
The President, as you know, has promised that he will not
sign another consolidated 12-bill package. In the House, we are
trying to do our part to ensure that the process moves forward,
that we have bills to go to conference with the Senate once
they have completed their work. To ensure these bills will be
considered in a timely manner, I think the--or I would submit
that the Senate has got to strongly consider doing away with
filibuster rule on appropriation legislation. By eliminating
this Senate practice on appropriation bills, the Federal
funding can be streamlined, and this institution can get back
to upholding our constitutional responsibility.
The Senate's responsibility is to the people they represent
and to their constitutional duty to fund the Federal
Government, not the administrative rules that are governing
their body. Even though our Founding Fathers gave the House
authority to originate money--bills through the origination
clause in the Constitution, the House somehow thinks that now
it is in our best interest to take a step back to the Senate
internal rules. And what we have found is ourselves
prenegotiating House bills with the Senate.
I believe the House should continue passing appropriation
bills that reflect the will of the people. We should then
present each appropriation bill for Senate consideration. And
then, as the House, hold out for passage so that the Senate can
get to a formal conference. This conference should reflect a
bipartisan approach that can reach a majority in each Chamber--
a simple majority and not a super majority. If the majority
party wants to filibuster and shut down the government, then
that would be their prerogative. This is what I would call, and
I think most of us would consider regular order. It has worked
for decades upon decades in this institution. But we have
gotten away from that, and if we are going to be successful in
making Washington work for the people instead of partisan
gridlock, it is going to take getting back to regular order or
these basics.
Let me add that one proposal which I do not think is a good
idea is having a 2-year appropriation bill. I am very concerned
about the matter of oversight. The annual appropriations
process allows for a relatively quick review of how response--
agency in addressing congressional concerns. It allows the
entire House and Senate to be involved in the process in
contrast to the reprogramming actions, and they do serve a
legitimate process.
Above all, we must remember that the legislative bodies
representing--we are representing our voters. We take money
from our voters, from hardworking families. And it is very
legitimate that we use both directive and be very diligent in
our oversight as we turn that money over to the executive
branch.
And, with that, I see my time is out, and I yield back.
[The prepared statement of Robert Aderholt follows:]
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Co-Chair Womack. Thank you to the gentleman from Alabama.
Representative Lowey, the co-chair.
Co-Chair Lowey. I just want to thank the gentleman from
Alabama. And on an optimistic note, I am aware that the Senate
is moving rather quickly working in a bipartisan way. And I am
hoping that at a time near the time they complete their work
and we complete the work, the bills can be meshed in a
bipartisan way, and the authorizing poison pills that have been
attached to the House bill can somehow disappear, and we could
all work together and have a good bipartisan process.
So, I just want to thank you.
Representative Aderholt. Thank you. Thanks for letting me
come before the Committee.
Co-Chair Womack. Thank you, Representative Aderholt.
Our next witness is a gentlelady from Connecticut,
Elizabeth Esty. And the joint select Committee appreciates the
opportunity to hear your testimony this morning. And we will
open the floor for you for 5 minutes ma'am.
STATEMENT OF THE HON. ELIZABETH H. ESTY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CONNECTICUT
Representative Esty. Thank you, Mr. Chairman and Ranking
Member Lowey, for the opportunity to present some views of how
I think we can improve the budgeting and appropriations process
in this House.
In particular, I would like to focus on a broader principle
of the breakdown of long-term decision making and planning. I
see this with great clarity as the vice ranking member of the
Transportation Committee where we have been unable to pass
major infrastructure planning. And I think the American people
are largely unaware that, unlike States and unlike individuals
who have capital budgets, that we do not do that in the U.S.
Congress.
And so, the normal political pressure to do short-term
planning has now become, I believe, significantly aggravated by
where we are with deficits and in our budgeting process. So, I
would urge the Committee, regardless of what specifics you come
up with, that we should be focused on making good long-term,
wise decision making for the American people. And I think we
have gotten away from that. And I think the budgeting process
has now compounded that process.
I think there are some things we could look at in doing
that capital budget, which I know that we have had previous
Members of Congress who advocated for strongly 2-year budgets.
But the bottom line should be we need to empower and equip
Members of Congress to think about how to make those long-term
decisions.
The CBO plays an important role there. We have met with
them and tried to solicit some ideas about what they could do
by limiting them to a 10-year time window to look at and
requiring a specific figure rather than ranges. I think we are
limiting their ability to inform us.
We know, for example, in the field of healthcare,
preventive care has the most important benefits, not 10 years
out but 20, 30, 40 years out. But they are statutorily
prohibited from considering those long-term benefits.
When I have asked them directly about what it would take to
do that, they say, for one thing, they need statutory
permission to do that. But I think they would also be more
comfortable if they were allowed to give ranges or confidence
levels further out: You know, we have high degree of confidence
10 years out, but in the outer--further out years, we would
expect savings. But these are more guesstimates, perhaps. I
think that could help inform our debate whereas now they are
not allowed to do that whatsoever. So that can be in preventive
care. Certainly, that is true for infrastructure where we are
just gridlocked. And we will pay for pieces of paper in our
offices, but we won't pay for replacements of bridges and
roads.
The American people don't get why that is happening. And
part of that, frankly, is the scoring process makes it hard. It
makes it easy to do the piece of paper and really hard to
replace the bridge.
So, whatever ends up happening, I think we have to look at
how the budgeting process can empower and inform Members to be
wise, to make those long-term decisions. And the budgeting
process should be part of that.
We know we have got gridlock on many political
disagreements. But I think notions about the value of
preventive care and healthcare, about the importance of
infrastructure, we all know that. We don't need to go to school
for that. So, therefore, we need to a take good hard look at
our budgeting and appropriations process to find out what are
current impediments to us making wiser decisions.
So those were my 2 cents about how we should approach the
objectives, not the specifics of how we do it but really the
touchstone of what we need to be doing. We all know that is
true. The American people can't figure out why we can't get
these budgets done. And I believe some of those longstanding
practices or those guardrails we set in place have, in fact,
have become an impediment to exactly what we thought we are
supposed to be doing and certainly what the American people
believe we are supposed to be doing.
Thank you very much.
[The prepared statement of Elizabeth Esty follows:]
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Co-Chair Womack. The joint select Committee appreciates
your testimony this morning, Representative Esty.
Representative Esty. Thank you.
Co-Chair Womack. Our next witness has just entered the
room. We are going to ask the gentleman from California if he
is prepared.
The Committee appreciates the testimony from all the
Members.
And, Representative McClintock, we are going to give you 5
minutes. The floor is yours. And thank you for being with us
this morning.
STATEMENT OF THE HON. TOM McCLINTOCK, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Representative McClintock. Great. Well, thank you for
having me.
All spending originates in the House. In a very real sense,
the buck starts here. The government cannot spend a single
dollar unless the House says it can spend that dollar. The 1974
Budget Act gives the House a very powerful set of tools to
control spending and balance the budget.
For years, on the House Budget Committee, I have heard it
said that the budget is merely an aspirational document
offering our vision of the direction the government should
take. That is simply not true. The budget is an operational
document, the single most important tool that we have to
control spending. The problem is we don't use it.
I have also heard incessantly that it is the mandatory
spending that is to blame, and that is beyond our control.
Well, mandatory spending is out of control, but it is a lot
easier to change than discretionary spending because the
reconciliation bill gets expedited consideration in the Senate;
the appropriation bills do not.
The budget resolution sets limits on the discretionary
spending that is appropriated annually. That is about one-third
of our budget. It also limits the mandatory spending. That is
set by statute. That is about two-thirds of our budget, and it
gives us powerful tools to enforce both sets of limits. The
problem is we don't use them. Why?
Well, the first problem is on the discretionary side. Those
limits are sent to the House Appropriations Committee which
cannot exceed them. The House routinely meets this
responsibility; the Senate does not because its dysfunctional
cloture rule gives the minority the ability to block them. As
the deadline approaches and the threat of a government shutdown
looms, the appropriation bills are cast aside in favor of
stopgap measures that continue the spending trajectory without
serious reform.
Now, that is easy to fix. Give appropriation bills the same
expedited consideration in the Senate that the reconciliation
bill already has. The bigger problem is on the mandatory side,
and process reform is not going to fix it. The mandatory limits
are supposed to be placed in reconciliation instructions that
are sent to the House authorizing Committees. Those Committees
are then required to make conforming statutory changes. If the
Committees fail to act, the Budget Committee can do so
directly. Either way, those statutory changes go into a single
reconciliation bill that bypasses cloture. But this powerful
process is never used. Why? Well, because decisions on
reforming mandatory spending, mainly entitlement programs, are
the most difficult decisions in our fiscal policy. It is easier
not to make them and blame the process.
Every year, the House Budget Committee produces a budget
that it claims will balance in 10 years, and it lays out
proposals on how to do it. But it never places these proposals
in the reconciliation instructions that transform them from
promise into action.
This year's budget is case in point. It promises mandatory
spending reforms to balance within 10 years but only places 5
percent of those reforms into reconciliation instructions that
will actually change spending. In other words, we are 5 percent
serious about balancing the budget and 95 percent unserious.
If we were serious about the mandatory reforms, we would
put them in the reconciliation instructions and force the
statutory changes necessary to make them. We would also include
discretionary limits that would begin the trajectory back to
balance in this year's spending. The fact is we didn't.
With all due respect, that makes this Committee's work
largely a fool's errand. The principal problem with the budget
process is it requires very hard decisions. Changing the
process isn't going to make these decisions any easier.
Whatever the process, the decisions are going to get harder and
harder every year that we don't make them.
Let me close with a warning. The countries that bankrupt
themselves aren't around very long. Debt the size that we are
now carrying ends up either as a fiscal crisis like those
paralyzing Venezuela and our own territory of Puerto Rico or as
an economic crisis as the central bank buys up debt at the
expense of economic growth as we are seeing in Japan and
throughout Europe.
Over the past 10 years, while populations increased 26
percent, our revenues have more than kept pace. They have grown
29 percent. But spending has grown 46 percent. In short, it is
the spending, stupid. Our job is to control that spending. We
have powerful tools to do so, but we have not used them. The
fault, Dear Brutus, is not in our stars but in ourselves that
we are underlings.
[The prepared statement of Tom McClintock follows:]
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Co-Chair Womack. Thank the gentleman from California for
his testimony this morning.
Our next witness is from Illinois, Representative Bill
Foster.
Sir, we appreciate the opportunity to hear your testimony
this morning. I will speak for the entire joint select
Committee in thanking you for your testimony. And we will give
you 5 minutes. And the floor is yours, sir.
STATEMENT OF THE HON. BILL FOSTER, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF ILLINOIS
Mr. Foster. Great.
Well, good morning. I would like to begin by thanking Co-
Chair Womack and Co-Chair Lowey and the other members of the
Joint Select Committee on Budget and Appropriations Process
Reform for holding this Members' Day.
I am here to discuss the debt limit, which I view as the
most unnecessary and disastrous risk to financial stability and
the economic recovery of the last 8 years. Over the last 6
months, I have discussed this issue with various administration
officials and many experts in hearings of the House Financial
Services Committee and in private meetings.
In the Committee, Secretary Mnuchin responded that he did
not support it, the debt limit, as a mechanism for controlling
spending and--last year. And in February of this year, he
thought that the repeal should be one option discussed in the
long term.
I agree with that statement, and I hope to advance repeal
as one option that this Committee considers. The debt limit is
an artificial fig leaf over the fiscal irresponsibility in
Congress. It sometimes gets referred to as being like refusing
to pay for a meal after you have eaten it.
On one hand, the debt limit instructs the administration
not to issue debt beyond a certain point. On another hand--on
the other hand, Congress slashes revenue without paying for it
and increases spending across the board even on projects that
do not make sense. The deficits created here inevitably trigger
a crisis with the debt limit. As a result of the partisanship
that has defined recent sessions of Congress, the debt limit is
a self-inflicted risk that is unnecessary and obviously
ineffective. Moreover, it creates a default risk that is not
market-driven, complicating the calculation of risk and likely
distorting pricing. The United States--if the United States
ever exceeded the debt limit, results would be catastrophic for
our economy and for hardworking Americans.
This problem should not be a partisan issue. It is an issue
that impacts middle class families in every congressional
district and unnecessarily slowed the recovery from the Great
Recession. A 2013 Treasury report found that when this Nation
approached the debt limit without a clear path to raising it,
the average mortgage in the United States increased $100 per
month. We need to address our debt limit through the budget
process, the Tax Code, and appropriations. We need to address
our debt through the budget process, the Tax Code, and the
appropriations, and not the artificial debt limit.
Our economy should not endure a market-rocking event
because of a partisan fight over an arbitrary number that is
not related either to economic performance or to GDP.
I asked the Federal Reserve Chairman Powell about the size
of our debt relative to aggregate household net worth, which,
as many have noted, recently exceeded $100 trillion. He agreed
that we have to address our debt in the long run but that we
are presently not nearing our carrying capacity.
Our failure to provide adequate revenue to pay for the
programs hardworking Americans need created a serious
structural debt problem. Our economy is both rich and
productive enough to fulfill our obligations to the most
vulnerable.
We can afford to ensure that Social Security, Medicare, and
Medicaid are available in perpetuity. And I strongly believe it
is a moral imperative that we do so. The debt limit does not
provide fiscal discipline but does cause market problems. There
is no hypothesized credit limit of the United States of which I
am aware. But it is clear that it is greater than the current
debt load based on the market appetite for Treasuries and low
interest rates. Repeal would allow markets to impose this
discipline. We should consider other mechanisms for forcing
Congress to have real debates on fiscal policy. These could
include changing House rules to provide for the privilege of
the House for bipartisan budgets that balance or a queen-of-
the-hill process that could provide for votes on either end of
the political spectrum and a centrist alternative with
bipartisan support.
I appreciate the opportunity to the joint--to testify
before the joint select Committee, and I am happy to answer any
questions.
Thank you.
[The prepared statement of Bill Foster follows:]
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Co-Chair Womack. The Committee appreciates your testimony
this morning, Representative Foster. Thank you so much.
Our next witness is the gentleman from Arkansas, Mr.
Westerman, representing Arkansas' Fourth district. Bruce, the
Committee appreciates the opportunity to hear your testimony
this morning. You have 5 minutes, and the time is yours, sir.
STATEMENT OF THE HON. BRUCE WESTERMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ARKANSAS
Mr. Westerman. Thank you, Mr. Chairman.
And I want to also thank the joint select Committee for
hosting this session to obtain Members' input on the current
budget and appropriation's process.
As with many of you, I am deeply troubled by current levels
of Federal outlays and appreciate the opportunity to share my
concerns today.
Federal Government spending is out of control, unlike State
spending, which is generally limited to the amount of money
collected from taxes, Federal spending is permitted to vastly
exceed income, and indeed it does.
In April, the Congressional Budget Office released its
annual budget and economic outlook, the 10-year economic
forecast based on projected cost of current legislation.
Economists at CBO predict the overall spending will reach $56.6
trillion over the 10-year period from 2018 to 2028, ultimately
exceeding 23 percent of GDP. Due to this obscene level of
spending, budget deficits will continue growing at ever-
increasing rates. Altogether, deficits are likely to average
4.9 percent of GDP, which is significantly greater than the
projected average economic growth rate of less than 4 percent.
And as the Nation's debt increases, so will interest
payments. Annual interest payments are slated to reach $915
billion by 2028. That is 3\1/2\ times what we have spent on our
debt in fiscal year 2017.
Deficit spending is easy. Balancing a budget is hard. It
requires tough decisions that many do not wish to make and
decisions that will inevitably upset certain individuals.
But at some point, these decisions have to be made. We
simply cannot continue spending beyond our means. I believe it
is in our Nation's best interest to set priorities now while we
have time to evaluate options and process decisions instead of
just waiting for the day of reckoning unprepared with no good
options when it comes. We owe it to our children and
grandchildren and to all those hoping for a bright future in
our country.
Contrary to the assertions made of some, a plan to balance
the budget within the next 10 years would not eliminate
Congress' ability to respond to economic changes, natural
disasters, or security threats. In fact, balancing the budget
within 10 years is achievable even without slashing
appropriations to government programs. We must simply just slow
the rate at which our spending has been growing and is
projected to grow.
CBO projects that baseline spending at a year-over-year
rate, growth rate of 6 to 7 percent over the 10-year budget
period. To balance the budget, we don't have to cut spending.
We just have to slow the rate of spending growth instead of
growing it at the CBO baseline. We could balance by growing at
the same rate as the economy grows, at the same rate as the GDP
grows. And I believe we should tie and force ourselves to
control the spending growth at the same levels that the economy
grows. I think that is a fair shake, and that is what the math
proves that it will take to balance a budget. Regardless of how
we get to that number, we have to stay below those levels.
In a graduate level statistics class, I remember two
sayings that the professor made that I think apply to my
service in Congress. The first one was he said that figures
don't lie, but liars figure. And the second one was that
numbers and people are the same; if you torture them long
enough, they will tell you anything you want to know.
It is time for us to quit torturing the numbers. It is time
for us to use commonsense and math and look at the reality that
if we continue growing government spending at the rates
projected in the CBO baseline, we will never balance the
budget. Let's balance the budget while we can with modest
growth, not with cuts, but modest growth. It is a 2 to 3
percent range that we are seeing in our economy.
We also have to get back to regular order. And I am glad to
see that the Senate is finally taking up appropriation bills. I
hope we will get all those bills passed in the House. And I
think it is the Budget Committee's responsibility to prepare--
or to force as much as we can. And if we can't force it now, we
need to put policies in place to force regular order in the
House and the Senate so that all these appropriation bills are
debated and open in a transparent way and so that we know what
we are spending the money on. And we are not including new
programs in large omnibus bills.
I believe the Committee has the ability to enforce this.
And as a member of the House Budget Committee, I will support
you in your efforts to do so. And I am here to lend whatever
resources or assistance I am able to.
With that, I yield back.
[The prepared statement of Bruce Westerman follows:]
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Co-Chair Womack. Thank you very much, Representative
Westerman, for your testimony before the joint select Committee
this morning.
Our next witness comes from Utah, Representative John
Curtis.
The Committee is delighted to have you in front of them
this morning and look forward to your testimony. You have 5
minutes, sir, and the time is yours.
STATEMENT OF THE HON. JOHN CURTIS, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF UTAH
Mr. Curtis. Thank you. Thank you, Chairman Womack and Co-
Chair Lowey, for holding today's hearings on reforms to
Congress' budget and appropriation process.
The American people are justifiably frustrated with
Congress and our inability to do our most basic job: pass a
budget and fund the government. I applaud the work of this
joint select Committee for holding this critically important
hearing to look at potential reforms to fix our broken budget
and appropriation process.
I want you to know I find myself thinking about you a lot
in this Committee, and I hope you feel me cheering in the
background for your success. As a relative newcomer to
Congress, many members of this Committee likely don't know who
I am, so I would like to take a brief moment to introduce
myself. I am John Curtis. I have the great honor of
representing Utah's Third Congressional District. Before coming
to Congress last November in a special election, I was mayor of
Utah's third largest city, Provo, Utah, for 8 years.
Like many of you, having served in local or State
government, I have had to make hard decisions needed to balance
a budget, especially when that involved cutting spending. I am
proud to say that as a mayor, we balanced our city's budget
every single year, including my first year in 2010 when we were
required to close a gap of 8 percent between revenues and
expenses. Not only did we do it without raising taxes, but we
also increased the level of services given to our residents
and, at the same time, improved employee morale.
Those who know Utah know that some of Utah's core values
are fiscal responsibility and restraint. The Utah values of
fiscal responsibility and restraint are best demonstrated by
the fact that Utah's State constitution requires, by law, that
the State and city government balance their budgets every year.
To maintain a balanced budget, we rely on many good
policies and restraints on lawmakers. But I am here today to
share with you only one of those practices that I believe, if
adopted by the Federal Government, could dramatically change
the quality of our budgeting process.
The idea was born when a former Governor threatened to veto
the entire budget if the legislature didn't include her pet
project. The idea is not unique to Utah, and it is not
revolutionary. In fact, it is almost too simple. In Utah, we
call it the baseline budget. At the first of every legislative
session, the legislature adopts a baseline budget. This is
largely the previous year's budget. Therefore, the default, if
we fail to come to agreement, is the continuation of last
year's budget.
Natural inflation puts pressure on the legislative body to
come up with a new budget. But while we do so, we are under no
threat of a government shutdown. Think of it as a kinder and
gentler continuing resolution. It allows for the important
wheels of government to keep churning while we, void of
pressure, study and deliberate without throwing hundreds of
government responsibilities into a tailspin.
I have been in Congress for only 7 months, and I voted on
four continuing resolutions, and I have seen two shutdowns.
Each time, I felt like a hostage with no option. As Members of
Congress, we are given a several hundred-page spending bill
often with only a day or two to consider it and told that if we
don't vote in support of the legislation, the government will
likely shut down. When this happens, there is simply no way to
do our jobs as promised back home.
By passing a baseline budget or essentially adopting the
previous year's budget at the beginning of the legislative
session, the State legislature is able to make meaningful
adjustments to the spending levels for next year's budget
without a threat of a government shutdown if they fail to come
to an agreement.
Utah is doing a lot of things right, and I believe this
baseline budget process is one of many that Congress can learn
from States like Utah. I strongly recommend that the select
Committee study Utah's baseline budget process and consider
recommending that it be adopted in Congress' budgeting and
appropriation processes moving forward.
Thank you for this opportunity to testify today, and with
that, I yield my time.
[The prepared statement of John Curtis follows:]
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Co-Chair Womack. Thank you, Representative Curtis, for your
testimony this morning.
I am going to move quickly to our next witness from
Connecticut. Representative Jim Himes represents the Fourth
District of Connecticut.
Representative Himes, the Committee appreciates the chance
to hear your testimony this morning on this very important
subject. And the floor is yours, sir, for 5 minutes.
STATEMENT OF THE HON. JIM HIMES, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF CONNECTICUT
Mr. Himes. Thank you, Mr. Chairman and Madam Ranking Member
and distinguished members who are here. I would really like to
thank you for bringing us together to today discuss an
important topic at the heart of our governance, how to budget,
how to raise revenue, and how to spend on a rational and
fiscally sustainable path.
As chair of the New Democrat Coalition, I am proud that our
forward-thinking members have been at the forefront of budget
reform looking for opportunities to plan for our future in a
thoughtful, bipartisan, and rational way, which is the exact
opposite of how this process has worked for the 10 years that I
have been here. This is a moment of optimism for me, though a
small one, because in 10 years, I have finally decided that the
number of people who are truly interested in fiscal
responsibility in this body can be counted on one hand. My
friends on the Republican side of the aisle are absolutely
horrified by deficits right up until the moment there is no
longer a Democratic President to blame for them.
Democrats all too often see spending as the first solution
to every problem. Special interests and our constituents have
their wish lists, but nobody wants to pay for those wish lists.
I am a pessimist because I did see one plan a couple of
years ago that was a very tough but fair plan. I am referring,
of course, to the Simpson-Bowles budget which came out of the
super Committee process. It was really, really tough, but it
was fair. It protected the most vulnerable American citizens.
It asked everybody to give up some of the sacred cows of their
party. Yes, there were slight progressive tax increases, and,
yes, there were things like chained CPI, which people on my
side of the aisle did not like.
That proposal, which was the result of a lot of hard work
and political sacrifice, received exactly 33 votes in the
United States House of Representatives, less than 10 percent of
the membership. That is where we are. That is why I am a
pessimist. But I do appreciate the Committee focusing on this.
The only question in my mind at this point, having given up
on the idea that we are collectively going to take the hard
decisions and look at our various constituents and say
everybody needs to give something, my fear is that the capital
markets will finally impose discipline on the United States
Government. So, the question is who is going to finally blow
the whistle? Will it be us or will it be the capital markets
who finally define for us what it is meant to be unsustainable?
Now, I will point out that we have set ourselves up for a
real problem here. When I came here 10 years ago, Admiral
Mullen said the single largest threat to our national security
is the debt. I was warned each and every day that we were going
to see spiraling Treasury rates, interest rates going up. We
were on the verge of catastrophe. The exact opposite happened.
Interest rates stayed low. We continued to spend in a long-term
unsustainable pattern. We just got through a process of adding
$2 trillion to the deficit over a 10-year period, and yet
remarkably the capital markets don't raise a whimper. That will
not remain the case.
So, we will see. I actually, sadly, though I am not
temperamentally pessimistic, believe that it will finally be
the capital markets defining for us what sustainability is that
forces us to act.
In the meantime, I just want to offer three ideas that I
think might help the process and at least get us to a more
honest process. Number one, first, do no harm. I have seen in
10 years any number of hostage situations associated with the
debt ceiling which does absolutely no good in terms of
controlling the overall amount of debt or forcing fiscal
discipline. Let's get rid of the hand grenade that each party
gets to use once every couple of years. It led to downgrades.
It led to market insecurity. Let's get rid of it. It does
absolutely no good to anybody.
Number two, let's put together a process to be honest and
level with the American people on the complex nature of the
problem and the big steps that we need to solve it. Again,
Simpson-Bowles, now a part of distant history and a very
painful thing for those of us who voted for it, pointed in the
direction of actually making people think about what sacrifice
means and who should do that sacrifice.
Third, let's plan for the long haul. Let's bring Members
together early to look at the far-out horizon, come to a
consensus, and develop a plan that can outlast the shifting
partisan wins. This could include a shift to biennial
budgeting, including tough allocations that genuinely last a
full Congress and allow agencies to efficiently plan ahead.
Again, I hope that this Committee can shake this place in
such a way that we do what we have been elected to do, which is
to take the tough choices, to speak truth to the American
people, and to preserve not just those programs which have done
so much for the American people but to keep the economy
competitive and to be worthy of the people who send us here.
So, thank you to the Committee, and I yield back my time.
[The prepared statement of Jim Himes follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I appreciate the testimony of
Representative Himes this morning.
Our next witness from Kansas, Roger Marshall, representing
the First District of Kansas. Sir, we appreciate the
opportunity to hear your testimony this morning. We are going
to give you 5 minutes as soon as we change a name placard. If
you would engage that microphone, sir, we are going to give you
5 minutes, and the floor is yours.
STATEMENT OF THE HON. ROGER MARSHALL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF KANSAS
Representative Marshall. Thank you, Mr. Chairman. And
certainly, I don't need to preach to the choir here and explain
to you the challenges before us and the inadequacy of our
efforts and results since my time here.
First of all, I want to just talk to you about solutions.
My first suggestion is to consider separating the budget from
the appropriations process. While it feels too much like an
excuse I have heard from my own sons, having additional time to
complete the annual budgeting and appropriation task would go a
long way. While this city seems to live from new cycle to new
cycle, I have never seen a company or organization that so
often starts a year and continues working without a budget as a
basic guide for the rest of their operations.
While I don't like to admit that Congress is slower than we
should be, there is something to be gained by recognizing this
reality. Putting Congress on a 2-year budget cycle, a 2-year
budget cycle allows an overarching agreement to be formed that
Congress and then the work of Appropriations Committee can
happen in a deliberate fashion rather than those two happening
on top of each other, many times feeling like it is
simultaneous to me. It seems like the budget has very little
teeth to it.
Next, I would talk about staggering fiscal years for
appropriations bills. At first glance, I am not a person that
likes to make things more complicated, but we currently are
moving from a cliff-to-cliff governance that having all 12
annual appropriations due in a single month creates. When all
12 expire at the same time and Congress gets behind the eight-
ball, it is too easy to combine them into a large omnibus that
leads us to passing one continuing resolution after another.
Next, I would talk a little bit about the increasing
involvement with the authorizing Committees. And certainly, I
know there are many appropriators in the group and that this
suggestion may not be popular, and I salute those people that
are doing the best job they can under the circumstances. But
the reality is, despite your best efforts to reach Members
through Member Days and the appropriation request process, non-
committee members have much less involvement in the annual
appropriation process. So, we need to look for ways to improve
that.
And then finally just to touch on entitlement programs once
again. Right now, three-fourths of our Federal budget is going
towards these entitlement programs, and it seems like we don't
have a chance for the budget or appropriations Committees to do
anything.
Certainly, I understand the entitlement programs are
necessary. The retirees in my district count on knowing how
much and when social security checks and Medicare benefits will
arrive. However, the current treatment of that spending sets up
failure, as there is no practical opportunity to edit or adjust
the programs, even if working decades into the future. Right
now, healthcare expenses are responsible for actually 28
percent of Federal spending. We have to find ways to have tough
discussions and take this challenge head on.
Much of what needs to be done is outside of the
congressional budget process, things like putting consumers
back in charge of their healthcare dollars, increasing
transparency and supply chains, and freeing private companies
to innovate. But structuring our budget process in such a way
to provide additional scrutiny into where these mandatory
dollars go can help us start to bring the healthcare costs
down.
Thank you so much for the chance to appear before the
Committee.
[The prepared statement of Roger Marshall follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Representative Marshall, we appreciate it.
The Committee thanks you for your testimony here this morning.
Our next witness doesn't need a lot of introduction, been
around these parts for a long time. He is authoritative in a
lot of subjects regarding budgets and appropriations, having
served as the overall Chairman of the appropriations process in
the House for 6 years, continues to serve on the Appropriations
Committee as a subcommittee chair.
And, sir, The Joint Select Committee appreciates the
opportunity to hear your testimony this morning. So, at this
time, I am going to recognize the gentleman from Somerset,
Kentucky, Chairman Hal Rogers.
STATEMENT OF THE HON. HAL ROGERS, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF KENTUCKY
Representative Rogers. Mr. Chairman, Mrs. Lowey.
Co-Chair Womack. Make sure that mike is on, and the floor
is yours.
Representative Rogers. Thank you for the opportunity to
testify this afternoon. I have been in this body for 38 years,
35 of which has been on the Appropriations Committee. So, I
have a little bit of a unique perspective on the process,
because of that long period of time.
Congress, of course, has the power of the purse and we are
obligated to exercise that power, thoughtfully, responsibly,
but also regularly. During my tenure as Chairman of the full
Committee, my top priority, as was that of Mrs. Lowey, my
ranking member, was returning to regular order, so that Members
on both sides of the aisle had an opportunity to express the
priorities of their congressional districts. Regular order
means moving 12 bills through an open and transparent Committee
process and then taking the bills to the House floor for
discussion and debate in an open atmosphere.
In the 6 years that I was privileged to lead the Committee,
as a result of that openness, we drafted strong bipartisan
bills. I was proud to work with Ranking Member Mrs. Lowey and
her predecessor, Norm Dicks, to bring 138 bills to the House
floor, 69 of which were ultimately enacted into law.
Together, we debated over 2,100 amendments in the course of
more than 550 hours on the House floor. The Committee held over
650 budget and oversight hearings, to ensure our tax dollars
were being spent wisely. I am pleased and grateful that
Chairman Frelinghuysen has continued these important efforts,
maintaining a spirit of hard work and collegiality on the
Committee.
The primary message, Mr. Chairman, Mrs. Lowey, the primary
message I would like to convey to you today is that this
important task, as time-consuming and politically difficult as
it may be, needs to remain an annual exercise for two primary
reasons: First, Congress has a responsibility to hold Federal
agencies accountable to the American people through the
appropriations process.
Second, in the dynamic world we live in today, Federal
agencies need to be nimble and responsive. Their appropriations
should reflect changing priorities and needs, and they need to
be able to move expeditiously through reprogramming requests
and the like. And that means a constant contact with the
appropriators all during the year, not just every other year,
not just every year, but every day.
On the first point, no matter which party sits in the White
House, in our system of checks and balances, the Congress has a
duty to ensure the executive branch is responsibly spending
Federal resources according to Federal law.
And I believe that moving toward a 2-year budget resolution
as we have been doing, frankly, the last few years, is a good
thing. It gives the Appropriations Committee and the Congress
advance notice about what the targets are going to be 2 years
from now so that we can plan for that.
So, I think a 2-year budget resolution will go a long way
to promote regular order and stability, provided it also
includes annual appropriations, to give you, as a Member of
Congress, the chance to question agency heads and the like
frequently, not just once a year but lots of times a year.
So, I am grateful for the work all of you are doing on this
Select Committee, and I hope your recommendations will move our
esteemed body forward.
I have noticed, Mr. Chairman, too that since the Senate has
been unwilling or unable to take up and pass the appropriations
bills that we send over to them, the agencies picked up on that
really quickly. When the agency head would come before our
appropriating House Committee, they knew that we could not pass
through the Congress the bill appropriating for their agency.
So, they were very unresponsive to the House appropriators,
because they knew we didn't have the whip to crack. And that is
true even today.
So hopefully, our esteemed colleagues on the other side of
the Capitol will come to their senses and allow a majority vote
on going to proceed. If they want to filibuster the bill once
it gets on the floor, fine and dandy, but moving to proceed on
appropriations bills ought to be a majority vote. Neither body
should have the authority and power to shut down the
government. That is why we are here.
So, when the agencies that come before us to try to explain
why they want an X amount of dollars and how they are going to
use it, we need to be able to scare them, if you will, with the
ability to pass these bills through House and Senate and make
it law so that they can be responsible to us, as
representatives of a lot of people.
So, Mr. Chairman, I thank you for convening this meeting.
Thank you for letting me have a chance to say a word or two. I
will be happy to answer questions if you----
[The prepared statement of Hal Rogers follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I appreciate your testimony. Mr. Rogers, I
am going to yield to my distinguished co-chair, Mrs. Lowey. I
know she has some comments she would like to make.
Co-Chair Lowey. Well first of all, it has been an honor for
me to work with you for many years on the Appropriations
Committee, and I appreciate your testimony and I feel strongly
that appropriations have to be dealt with every year. And
certainly, the Foreign Ops subcommittee is a perfect example of
changing conditions in the world.
On an optimistic note, it is my understanding that in the
Senate, they are working together in a bipartisan way and are
moving rather quickly and getting the appropriation bills
through the process. So, I am always cautiously optimistic that
together in a conference we can work together in a bipartisan
way and somehow make all those poison pills disappear.
So, I want to thank you very much. It has been an honor for
me to work with you, and thank you for presenting your views,
with which I agree. Thank you.
Representative Rogers. Thank you, Madam Chair----
Co-Chair Womack. I know our next witness, Dan Webster, is
waiting in the wings. I just wanted to throw out one thing on
the table for my friend from Kentucky, and that is, when the
Speaker led this morning, his thesis statement was questioning
whether or not anybody believed that the Senate was ever going
to be able to manage and pass 12 appropriation bills in any
given year through the Senate. And so that becomes a basis for
a debate and a discussion about that.
Now, the good news is when our Joint Select Committee first
convened, we were careful not to make it a pick-on-the-Senate
program, because half of our members are from the Senate, and
they self-ID'd at the time that they were, indeed, part of the
problem, that being able to manage 12 appropriation bills and
because of Senate rules, there were problems there.
Do you think a biennial budget with 12 titles of
appropriations every year is doable, given the fact that the
Joint Select Committee is not going to have the power
necessarily to impose a change. We can only advocate through
legislative text some changes, but do you think that getting
maybe to the motion to proceed under a simple majority would be
the elixir that fixes that side of the problem?
Representative Rogers. I think so. I met yesterday and had
a good long talk with the Senate Appropriations Chairman, who,
as you know, the Senate now has passed a minibus of three
bills, which we will be able to conference one of these days,
hopefully. But I think the motion to proceed in the Senate
should be a majority vote, just to bring it up and get it on
the floor, appropriations bills, I would prefer. If they want
to do all, that is fine, but especially appropriations bills,
which are a different animal.
And it is the existentialism. It is whether or not we
survive as a government. But I think the motion to proceed
should be a majority vote. Let that bill come to the floor; and
if they want to filibuster it, hey, make my day. Speak all
night, the way it used to be.
But I've been here a little while, and the first 25 years
on this Committee it worked, not like a clock, but it worked.
We passed 12 bills. We went to conference on 12 bills with the
Senate. There was give and take. By nature, we had to
compromise to polish up a bill to be able to pass with a
majority vote. So, I have seen it work, and it works fine until
the Senate comes up with that rule that is a monkey wrench in
the cogs of government. So, I would hope that that would
change.
I met yesterday with the President and the cardinals on the
House and the Senate Appropriations Committee. And this was one
of the main points of conversation that we had. And the
President was very strong. That is not even the word for it. He
was really strong to the Senators about changing that rule, but
we found no sympathy on that side at this point in time.
But I think the pressure should build and is building on
the Senate to change an archaic rule that is preventing the
government from operating. And I don't get too excited about
things, but I am excited about this.
Co-Chair Womack. That and Kentucky basketball.
Representative Rogers. Yes.
Co-Chair Womack. Thank you for your testimony.
Representative Rogers. Thank you, Mr. Chairman, and Madam,
thank all of you for doing this hard chore. And it is good to
see my friend from Louisville, Kentucky, who claims to have a
good basketball team over there at U of L.
Co-Chair Womack. Thank you, Mr. Chairman. Appreciate your
testimony.
Our next witness is Dan Webster from Florida. The Joint
Select Committee Members' Day group here this morning does
appreciate the time you are spending with us. We look forward
to your testimony. The floor is yours, sir.
STATEMENT OF THE HON. DANIEL WEBSTER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF FLORIDA
Representative Webster. Well, thank you, Mr. Chair, and
others who are putting forth their time to listen to this hours
of testimony, I am sure.
I came to talk about maybe appearance of the process more
than just the minute details of the process. I believe that
there is mission creep between the Budget Committee, the
Appropriation Committee, and in the end the substantive
Committees, the authorizers. And if you look at it closely, you
will see that the appropriators in many cases do substantive
law. They do riders. They do other things, including approving
appropriations for nonexistent authorizations which have
expired.
On the other hand, the Budget Committee bleeds over into
substantive law by making assumptions of things that aren't in
law right now. And not only that, they also talk about the
funding of those, which is the appropriation processes. That is
their job, the appropriators. And if you just see, it all kind
of bleeds together.
And then in the end, the authorizers in many cases set
forth numbers, and that is not their prerogative, at least in a
peer system. That is the appropriators. The appropriators take
whatever is existing in current law, which is policy, and to
whatever degree they determine they fund that policy--it could
be zero, it could be $10, it could be a billion dollars--as
opposed to the authorizers inserting numbers and basically
making the appropriators follow suit.
So that is what I would like to talk about today. I think
the easiest way to get started on the revamp is to get rid of
the Budget Committee. That way, at least one of those bleeding
over into the others would go away. I think it is redundant in
a lot of ways. It is not nearly followed. Some years when we
don't do it, we go out and promote the fact we are not doing it
because it is really not needed. And other years when we need
it, we do it. And it is like it either comes and goes,
depending on what is the circumstance, and that is both parties
have done that.
So, if you got rid of that, then the appropriators would
only appropriate. They would appropriate on existing policy,
whatever that policy is, and they would do it to the degree
they determine and to the amount they determine or don't
determine. And then on the other hand, the authorizers would
not get to spend money. They could authorize something in let's
say a bridge and right of way area and that you can spend money
on bridges and right of way, but you don't necessarily put the
amount down that you are going to spend. That is the
appropriators' job.
And so, with that, the reason I would say that is I believe
that if we can purify each of those areas--and the easiest one
is to just get rid of one, that certainly purifies their
motives and other things--I think you end up with a process at
least where you are going to be able to participate at whatever
level you want to, but what you know you are not going to be
able to put money into a program that doesn't exist in the
appropriation bill. Nor, by amendment, could you be able to put
that--I mean into--you can't put authorized policy in an
appropriation bill, nor could you put an appropriation bill--
the appropriators cannot put policy in their particular bill.
That is a summation. There are all kinds of details it
would have to go through. How do you get what the overall
spending levels are? How do you allocate to each of the subs
and all that? I didn't go into that. I do have some ideas about
that, but I just said if we start by setting it.
The other is, I guess maybe the last thing, just we have
too many lines on a sheet of paper, all of which claim to be
the starting line for the budget or appropriation. And so, the
baseline should be one, one baseline only. That way, the
Members and public, everyone understands.
Appropriators appropriate, the authorizers authorize, and
there is one line that you start with. That is what I would is
say is the way to simplify the whole process.
[The prepared statement of Daniel Webster follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. Thank you very much for your testimony
this morning. The Joint Select Committee appreciates your
input.
Representative Webster. Thank you.
Co-Chair Womack. We have one remaining witness, and he is
the gentleman from South Carolina five, Representative Ralph
Norman. Sir, we again appreciate the chance to hear your
comments this morning. We are going to give you 5 minutes, and
the floor is yours.
STATEMENT OF THE HON. RALPH NORMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF SOUTH CAROLINA
Representative Norman. Thank you, Colonel Womack. I
appreciate the time with the Committee. I haven't been here as
long as Hal Rogers or Dan Webster or Rob or a lot of you, but I
just preface my prepared remarks with I don't think I have yet
any--there is no topic that is of more concern to the people in
my district than the budget, the deficit, the way we
appropriate money, since I have been elected and even before
then.
So, I would just preface my remarks, this is on the minds
of the people. It is on the minds of the people that put us in
office. And I am a business guy. I run a development company.
But I appreciate you taking the time, and I won't need the 5
minutes.
I think we all agree our budget process is broken. The 1974
Congressional Budget Act laid out what our role was and the
timeline for passing annual budgets and the 12 annual
appropriation bills. The last time Congress passed all 12
appropriation bills was 1997. That is 21 years ago.
For six straight years, between fiscal years 2011 and 2016,
not one single appropriations bill was passed on time. This
isn't a Republican issue. This isn't a Democratic issue. As a
business owner, as a developer, if I had not had a budget for 6
years, I would be broke. I would not be up here where I am
today, because you would not have the dollars. The company
would not have the dollars to exist. So not having a budget
process, from a practical sense, does not make sense.
I firmly believe our Nation cannot and will not remain
solvent if we keep passing trillion-dollar omnibuses and
continuing resolutions. My constituents will not allow me to
vote for something like that. This is a regular order and we
must follow it.
And what is amazing is the appropriation bills only cover a
third of our Federal spending. I would ask that we try to find
solutions, those of you who are on this Committee and those of
us as we serve in Congress.
The entitlement spending is the biggest driver of our
spending problems. And I found pretty quickly up here everybody
wants to cut until their ox is gored. And the current budget
process does not force lawmakers to confront fiscal and
economic reality.
Would a biennial budget and appropriations process work
better? Would strictly voting on monetary values with no policy
riders in appropriations bills alleviate the problem? Last
year, we passed all 12 appropriation bills in regular order
with amendments, and the Senate did not do anything.
I guess I would ask, what can we do to ensure the Senate
acts? Would implementing language force them to act better? I
don't know. All I would say is it is time for us, those of us
elected officials to start making the tough decisions with
spending, entitlement reform programs. We have got to start
addressing these in a timely manner and go back to basics,
which, as a business owner and business owners all across this
country I think would agree with.
Thank you, Colonel, for your Chairmanship, and thank the
Committee with the steps they take that will hopefully solve
this problem.
[The prepared statement of Ralph Norman follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the gentleman from South Carolina
for his testimony this morning.
I will yield to the distinguished co-chair for any last-
minute comments.
Co-Chair Lowey. Well, I just want to thank my co-chair. It
has been a pleasure working with you. I appreciate all those
who have submitted testimony and those who were here today. And
I look forward to reviewing the information and then coming to
some conclusions, which may or may not be implemented. But
thank you so much.
Co-Chair Womack. I thank the gentlelady.
That completes the Committee's business for today. I would
like to thank all the Members who shared their views before the
Committee.
As was stated in the opening remarks, written comments
already submitted will be made part of the official record. And
in consultation with the co-chair, I seek unanimous consent to
allow other members who may wish to input this process that
were unable to be here today to have until the close of
business on Monday, July 2, for such purposes.
Without objection, so ordered.
[The prepared statement of Rob Bishop follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
[The prepared statement of John Carter follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. And, with that, the Committee stands
adjourned.
[Whereupon, at 12:22 p.m., the Committee was adjourned.]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
OPPORTUNITIES TO IMPROVE THE APPROPRIATIONS PROCESS
----------
THURSDAY, JULY 12, 2018
House of Representatives,
Joint Select Committee on Budget and
Appropriations Process Reform,
Washington, D.C.
The committee met, pursuant to call, at 10:07 a.m., in room
1334, Longworth House Office Building, Hon. Steve Womack and
Hon. Nita M. Lowey [co-chairs of the committee] presiding.
Present: Representatives Womack, Woodall, Arrington, Lowey,
Yarmuth, Roybal-Allard, and Kilmer.
Senators Blunt, Perdue, Lankford, Ernst, and Bennet.
Co-Chair Womack. Good morning, ladies and gentlemen. The
Joint Select Committee on Budget Process Reform will come to
order. I want to welcome you to the fifth public hearing of the
Joint Select Committee on Budget and Appropriations Process
Reform.
The most important role given to Congress under Article I
of the Constitution is the power of the purse. Our panel is
charged with ensuring we have a working process in order to
fulfill this essential duty.
During our hearings so far we have identified some of the
recurring challenges that need addressing. Those have been
extremely productive discussions. I was especially pleased to
see the level of engagement from and hear the ideas of Members
during our Members Day meeting.
While we have discussed the annual budget resolution at
length during a previous hearing, today we are going to focus
on what is supposed to happen next, and that is the
consideration of appropriations bills.
Especially in a reform-focused committee like ours we
certainly need to be mindful of past processes and let
history's successes--and their failures--guide our decisions.
And the fact of the matter is that the current process needs
improvement. I think both sides of the aisle agree on that.
We on this panel are charged with designing a neutral
process for the future, one in which Congress can move forward
with its budgetary agenda no matter which party holds the
majority. Budgetary priorities, outcomes, and results should
come from elections. Thus, a properly functioning budget and
appropriations process should be neutral to specific outcomes.
That being said, as we engage in conversation today I urge
members to think about designing a process for the future. I
believe we can do that by considering what the modern Congress
can handle right now and anticipating the issues future
Congresses might need endure.
Without question I have tremendous respect for the decades
of experience that will come before us today, but I want to
challenge us all to think about how that experience can be
applied to what future officeholders will face as they try to
fund the government on time.
To help us think through the current appropriations
process, including its link to the annual budget resolution, we
are pleased to welcome two incredibly distinguished and
experienced witnesses. While both served on the same side of
the aisle, their perspectives demonstrate that the issues we
are trying to fix transcend party lines.
In fact, as I was thinking through the potential witnesses
one name quickly stood out in my mind: Leon Panetta. This is an
individual whose seasoned career encompasses many positions
that are relevant to our deliberations. He served as a
congressional staffer, executive branch official, adviser to
the mayor of New York, chairman of the House Budget Committee--
his painting hangs in these chambers--White House Chief of
Staff, Director of the Office of Management and Budget,
Director of the CIA, and finally, Secretary of Defense.
Given his tremendous background, I knew his presence at
this hearing today was vital.
Secretary Panetta, it is an honor to have you. Thank you
for being here.
We are also pleased to welcome David Obey, who served for
decades as part of the Wisconsin delegation in Congress. During
his tenure he led as both ranking member and chairman of the
House Appropriations Committee.
Chairman Obey, as an appropriator, I also appreciate you
being here today to give us your valuable insight.
And with that, I want to yield to my co-chair, Mrs. Lowey,
for her brief opening remarks.
Mrs. Lowey.
[The prepared statement of Steve Womack follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Lowey. Thank you.
And welcome to the Joint Select Committee's fifth hearing.
Today we have two witnesses with many, many years of experience
with the budget and appropriations process and a wealth of
knowledge on that subject. Both are good friends.
So I am looking forward to hearing your direct, honest
testimony.
One is David Obey, who served in the House for 42 years as
a Representative from Wisconsin. He was a longstanding member
of the House Appropriations Committee, served as chairman or
ranking minority member of that committee for almost two
decades. He has also been involved in many past debates about
budget process reform.
And our other witness, with whom I also had the privilege
of serving, is Leon Panetta, who is another former Member of
the House, past chairman of the House Budget Committee. In
addition, he has extensive experience at very senior levels of
the executive branch, including service as Director of OMB,
White House Chief of Staff, Director of the CIA, Secretary of
Defense.
So today I am delighted that we will hear from them about
what could be done to make our budget and appropriations
processes work better.
In addition to talking about procedural changes that might
help, I hope we will get the benefit of their long-term
perspective on the polarization and partisanship that is now
the fundamental cause of many of our difficulties.
I think I will read that sentence again because I really
feel that is the cause.
So I hope we will get the benefit of their long-term
perspective on the polarization and partisanship that is now,
in my judgment, the fundamental cause of many of our
difficulties.
So I look forward to the testimony. I should also mention
that, unfortunately, I will need to leave part way through the
hearing to attend the first House-Senate conference committee
meeting on 2019 appropriation bills. I wish I could stay for
all of what should be a very interesting session.
And, frankly, just to throw some information into the mix,
what is very interesting about this appropriations season is
the Senate is operating in a bipartisan way. Every bill they
have completed is bipartisan, where last night we completed
Labor-HHS with about 50 amendments.
So we are operating very differently, and that could be an
interesting discussion in itself as to process.
Thank you, my co-chair.
[The prepared statement of Nita M. Lowey follows:]
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the distinguished co-chair, the
gentlelady from New York.
Now I would like to welcome our distinguished witnesses.
First, and as I told him when he came in, I didn't know whether
to call him chairman, chief, director, Mr. Secretary, so I
think I will just say Jimmy's daddy is here to be a witness
before this committee.
So, Secretary Panetta, thank you so much for being here. It
is an honor to have you.
And for both gentlemen, your official statements are being
made as part of the official record of this proceeding, and we
are going to give you 10 minutes each to present your testimony
at your pleasure.
Sir, the floor is yours.
STATEMENTS OF THE HONORABLE LEON PANETTA; AND THE HONORABLE
DAVID OBEY
STATEMENT OF LEON PANETTA
Mr. Panetta. Thank you very much, Mr. Chairman. I
appreciate the opportunity to be able to be here and share my
experiences and thoughts with you on the tough task that is in
front of you to try to implement important budget reforms that
can hopefully improve that process.
I am also honored to be here with a dear friend and former
colleague of mine, Dave Obey. Dave and I together served on the
Budget Committee, but more importantly, in all the other
positions I held I had to deal with David when he was chairman
of the Appropriations Committee and always found him to be
someone who was fully committed to trying to do the right thing
for the country.
So I am honored to have this opportunity.
And I think, you know, both of us obviously will give you a
sense of the history that we experienced and what made the
process work at the time.
In the 50 years of public life that I have had, I have seen
Washington at its best and I have seen Washington at its worst.
The good news is I have seen Washington work. And I have
seen Democrats and Republicans with a willingness to work
together on issues. We have always had our political
differences. In my first experience in Washington, I was a
legislative assistant to Tom Kuchel, who was a Republican from
California, minority whip. I served under Everett Dirksen.
And at the time there were a lot of Republicans, both
conservative and progressive, but they viewed their
responsibility in the Senate as working with Democrats, people
like Jackson and Magnuson and Dick Russell, Sam Ervin, and a
number of others, Fulbright. They worked together on
fundamental issues.
When I got elected to the Congress, Tip O'Neill was the
Speaker, the Democrat's Democrat, but he worked very closely
with Bob Michel who was the minority leader. And that was the
legacy that I came into as a freshman Member, which was that
you work with your ranking members, you work with the other
party on the legislation that you have to deal with.
And so one of the fundamental messages that I have to
stress is the importance of bipartisanship to making this
process work. This is a tough process. Budget process is tough.
Getting the appropriations bills done is tough. And it is
difficult to do even when you are working together. It is
almost impossible to do when you try to shove this stuff
through the process on your own as one party.
The history of the budget process in the period when it
worked is the history of bipartisanship. The Budget Act was
passed on a bipartisan basis. David and I worked with chairmen
of the Budget Committee who worked with their ranking members,
Bob Giaimo, Del Latta; on the Senate side, Pete Domenici,
Muskie, a number of others, worked together.
When I was chairman of the Budget Committee I had the honor
of working with Bill Gradison and then with Bill Frenzel, and
we worked together. And the result was that we made some
significant progress.
It was not easy. It was a tough time. Deficits were going
up for a lot of reasons. But there were three important steps
that were taken that I think ultimately led to a balanced
budget.
One was the 1990 budget agreement in which we assembled
both Republicans and Democrats and representatives of the
administration to negotiate an approach to deficit reduction.
And we met, we negotiated, we finally went out to Andrews Air
Force Base and spent close to 3 or 4 weeks negotiating out
there.
The agreement at the time was that if the Democrats would
come forward with $250 billion in spending savings that the
Republicans would be willing to put $250 billion in tax
increases on the table.
And so we spent a lot of time. It was tough. None of these
decisions are easy. But we put together a $500 billion deficit
reduction package, a close to $500 billion deficit reduction
package.
And we had to push it through. It was not easy. But we
ultimately pushed it through in a bipartisan vote, an omnibus
package. It included a budget resolution, it included
reconciliation, and it included appropriations bills. But it
was passed, and we did it on a bipartisan basis.
The next effort that I think was important, I was OMB
Director and worked for Bill Clinton in putting that budget
together, and again, $500 billion in deficit reduction.
Unfortunately, that wasn't done on a bipartisan basis, and it
was tough. It only passed by one vote in the House and in the
Senate.
And then lastly, the bipartisan effort to put together a
balanced budget in 1997.
All of that contributed to a balanced budget and a surplus.
And then it was the breakdown, I think, in bipartisanship that
ultimately turned that all around.
The process is broken. It is broken because obviously
bipartisanship has broken down. Regular order has broken down.
There is a lack of enforcement. There is a lack of the ability
to work together and to have to wait for crisis in order to
drive the process.
I often say democracy is a process that we do through
leadership or crisis. The problem in this place is that crisis
becomes the driver now more than leadership. And when you
operate by crisis you have to wait for something terrible to
happen in order to do the right thing, and what you usually
wind up doing is kicking the can down the road.
And lastly, there has been a misuse of the reconciliation
process and the misuse, I think, of the general budget process,
which has lost a lot of respect.
What are the recommendations to try to fix it? I lay it out
in the testimony. I think the idea of a biennial budget is
worth looking at. It is not easy. There are problems that you
have to work through. But I think the more you can provide
additional time to do it and additional time for oversight on
ongoing programs, I think that is something to seriously
consider.
I think a joint budget resolution may make sense, as well,
to bring the President into the process. The way this game
works is the President presents his budget and then Congress
decides to go its own way. There is little communication until
you do the appropriations part of it. You really ought to
engage in the overall budget discussion with the President
early on. So that is worth thinking about.
I think you ought to change to a calendar basis just to
give yourself more time instead of the fiscal year approach. It
is not a cure-all, but at least the additional time would help
you.
I think you have to show a price to be paid for failure to
pass a budget resolution, so that legislation that has a fiscal
impact, frankly, should not move unless you have passed a
budget. You need to provide a process to increase the debt
ceiling so we don't have this crisis. We had the Gephardt Rule,
which tied to the budget resolution. I think that is worth
looking at.
Budget gimmicks, you have to get rid of budget gimmicks,
the whole idea of rosy scenarios and magic asterisks, the kind
of games that are played. And I have been a part of some of
that. I know what those games are. You have got to be able to
discipline people so they don't use it.
Paygo is a very important enforcement tool. We would not
have balanced the budget without paygo in which we said if you
are going to come up with spending, if you are going to come up
with tax cuts, you have got to pay for them and not increase
the deficit. You have got to get back to that.
You should do a common baseline between CBO and OMB.
Instead of fighting over growth numbers, frankly, you ought to
operate on the same consensus numbers from both of them.
I think you need some control of emergency funding. It has
got out of hand. You need to set up an emergency fund and
better controls over how that operates.
And I will tell you, even from the OCO perspective on
defense, the fact is when you have been in war for a long
period of time I don't see why you have to keep going to OCO.
It ought to be part of the budget, frankly, for the defense
budget.
Lastly, some check on mandatory spending. Two-thirds of the
budget is mandatory spending. We don't pay enough attention to
mandatory programs. And then a 10-year budget projection.
I think the most important guidance I can give you is that
the best way to pass budget reforms is to do a budget deal and
to do a comprehensive budget deal. If you can put those pieces
together, then you can pass the reforms as part of that. We did
that in the 1990 budget agreement.
If you can't do that, and that is probably the case, then
this joint committee ought to try on a bipartisan basis then to
make recommendations with regards to some key changes. You
don't have to do it all, but at least do a few changes to show
that this place can operate on a bipartisan basis when it comes
to the budget.
This is not a game. This is about the fiscal health of this
Nation. We are facing a fiscal crisis; 78 percent of GDP is now
debt. We are looking at it going to 152 percent of GDP,
according to CBO. That is trouble for our economy. It is
trouble for resources. It is trouble for the American people
and for all of the things we care about.
So that is what is at stake here. I know that this
committee is given the responsibility to do reforms. I think
you have the leadership capability to try to move something
that sends a signal to the American people that this place can
operate the way it should, with Republicans and Democrats
agreeing on tough decisions to be able to govern. That is what
democracy should be all about.
Thank you.
[The prepared statement of Leon Panetta follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the gentleman.
Mr. Obey.
STATEMENT OF DAVID OBEY
Mr. Obey. First, let me apologize for my voice this
morning. If some of you can't hear what I am saying don't worry
about it, you are not going to miss a hell of a lot.
I am happy to be here today with Leon Panetta.
Co-Chair Womack. Let's make sure that microphone is on.
Mr. Obey. That is a little better.
Leon is a good friend. He is truly a great American. All
you have to do is read his resume to understand that. And if
you know him, you know even more so that that is true.
We have gone through many battles together, but one
difference that separates the two of us is that I am from the
Pre-Cambrian Era and Leon is not. He was elected in 1976 after
the Budget Act of 1974 was in place, so that is the only
process he has ever known. I was elected in 1969 before there
was a budget committee. In that time the appropriations process
worked reasonably well. We just didn't realize it at the time.
At that time the President's budget meant something. There
was no talk about it being dead on arrival. The way it worked
was fairly simple. The President sent down the budget. The
Appropriations Committee held its hearings and produced its
bills. The Ways and Means Committee was on a separate track and
took whatever actions they thought was appropriate.
There was no formal arithmetic discipline. Discipline came
from the recognition by the committee and by the party leaders
that if the year's work was irresponsible there would be a
price to pay in public opinion and at the ballot box.
Under that system, from 1960 through 1974, and please
remember this, from 1960 through 1974 deficits averaged a
little less than 1 percent of GDP. In the worst year the
deficit was 2.8 percent. By comparison, in the years after the
Budget Reform Act, from 1974 through 2010, the year I retired,
deficits averaged 2.9 percent of GDP, three times as high, and
in 1 year it hit 9.8 percent.
From 1974 on Congress has searched for a magical provision
to rein in the deficit, a process provision. Ever since, the
budget process has been as chaotic as it has been super
complicated.
Why? Much of the blame has been dumped by some on the
Appropriations Committee. That is the wrong target. The main
procedural problem is that the committee with the
responsibility to pass the bills that actually determine
specific spending decisions has nothing to do with the budget
blueprint under which they are required to operate.
When you get right down to it, the main job of the Budget
Committee is to agree on three macroeconomic numbers: total
spending, total revenues, and the level of the deficit.
In contrast, the committee that has the responsibility to
broker the thousands of program compromises necessary to
implement that budget is the Appropriations Committee.
So the Budget Committee can fly at 30,000 feet, but the
Appropriations Committee and the Ways and Means Committee have
to slug it out on the ground level in hand-to-hand combat. That
means that if the Budget Committee targets are too optimistic,
ideological, or unrealistic the Appropriations Committee cannot
get the votes on the floor to implement their product.
When I retired in 2010 I was succeeded by Hal Rogers as
Appropriations chairman. I watched what happened to him. Each
year the Budget Committee would push a highly aggressive budget
resolution through the House, but when Hal tried to implement
that resolution with actual program-by-program cuts.
Members who had voted for the budget resolution would see
what the resolution in macroterms actually required in
microprogram terms, and Members who had voted for the
resolution initially would then say, ``What? You want me to cut
what? Are you crazy? Hell, no.'' And the system stalled.
So what would I do to change things? That depends on
whether you want to do major surgery or a patch job. For
instance, 2-year appropriations is a wonderful idea if you want
to erode congressional power or weaken Congress' ability to
deal with the bureaucracy and bury the Congress in
supplementals. Outside of that, it is a terrific idea.
If you want to do fundamental change, I would do four
things. One is procedural. I would abolish the Budget Committee
and return to the practice of using old-fashioned informal
political sanctions to impose fiscal responsibility. That would
give you more time to focus on the bills that actually spend
the money.
The Budget Act simply adds one more hurdle that Congress
must overcome without adding 3 months more to the calendar. All
the budget resolution really is, is an institutional press
release if it is not followed up by something else.
People will say, ``Oh, my God, you can't do that or the
deficit will balloon again.'' I would simply say that the
numbers I previously cited demonstrate that the empirical
evidence for that view is nonexistent. Deficits are larger now
as a percentage of the economy than they were before the Budget
Committee was created to prevent it.
Second, recognize what history tells us on revenues.
Recognize that in the last 50 years the budget has never
approached balance when revenues as a percentage of GDP have
not neared 20 percent.
Third, recognize that we are not just in danger of passing
on an uncontrolled budget deficit to our children, we are also
in danger of leaving them with an infrastructure deficit, a
skilled worker deficit, a science and tech deficit.
Recognize that over the past 50 years nondefense
appropriations spending has never been less than 3.1 percent of
GDP. The budget resolution passed by the House last year called
for shrinking that to 1.7 percent of GDP by the end of 10
years. I invite you to decide whether that is either achievable
or desirable.
The fourth thing I would do is recognize that the main
problem is not procedural, it is political. My favorite
philosopher is Archy the Cockroach, who said once that what
matters is not so much what system you have, what matters is
what you do with whatever system you happen to have.
I would ask you to learn a lesson from 1994 when I chaired
Appropriations the first time. I became chairman midway through
the session after Bill Natcher died. In spite of that fact, we
finished all appropriation bills before the start of the next
fiscal year.
That didn't happen because I was such a hotshot chairman.
It happened because the very first thing I did when I became
chairman was to go to my ranking Republican, Joe McDade. I told
Joe that I knew we would never agree on the details of
appropriations, but I asked him how he would feel about the
committee reporting a bipartisan 302(b) budget allocation. He
jumped at the chance.
For the first and only time in the history of the Budget
Act, that is what we did. It meant that we had agreed on how
much money each Appropriation subcommittee would allocate, or
would be allocated, but left the details to the subcommittees.
Unfortunately, it will be almost impossible to resurrect
any degree of bipartisanship because of the way you all are
elected. Too many of you come from hugely safe districts. The
way your districts are drawn produces little incentive to
compromise.
That problem is beyond the reach of this committee to
correct. But please at least recognize that your basic problem
is not the budget process. The budget process is simply one
example of how our political system has crippled the
legislative system.
Meanwhile, if all you really want to do is to put a patch
or two on the process, I would recommend one procedural change.
Right now the Budget Committee chair and Appropriations
Committee chair live in two different political worlds.
If you want to make the process more realistic, do one
thing. Either make the chairmen of the Appropriations and Ways
and Means co-chairmen of the Budget Committee or make the
Budget Committee chair rotate between the two. That way the
people who are expected to deliver the goods are the people who
are actually manufacturing them.
[The prepared statement of David Obey follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Co-Chair Womack. I thank the gentleman for his testimony.
We will move straight into questions, and I will begin.
To both of you, but particularly Secretary Panetta, two
things that in reading between the lines of your testimony,
there are two things that come to mind to me. One is the word
``discipline,'' having the discipline to do what the process is
outlined to produce, and the other one was ``bipartisanship.''
And as Mr. Obey has just testified, that is beyond kind of the
control of the Joint Select Committee.
But is it possible to get to a solution to the challenges
that face the modern day Congress without a discipline to deal
with the process the way it has been given to you and without
some spirit of bipartisanship, which seems to be very elusive
across the spectrum of issues facing the Congress?
Mr. Panetta. Well, Mr. Chairman, as stressed by both of our
comments, you can't do one without the other. I mean, that is
the problem.
I think the reality is that bipartisanship and the ability
to work together is the key to implementing discipline. If one
party alone tries to implement that discipline and doesn't have
support across the aisle then it is going to be stopped and
blocked and basically will be pushed to a point where it
doesn't serve the process that it was designed to implement.
Look, there is no question, I mean, your fundamental
problem right now is the lack of a willingness to enforce what
the Budget Act is all about. And admittedly, the Budget Act and
the budget process has never been an easy one to implement
because it does represent discipline.
As chairman of the Budget Committee, you are never popular
because you are establishing priorities. But the nature of the
budget process is to establish priorities. It is not about
numbers. This is not about just moving numbers around. It is,
what are the priorities of this country? That is what is
reflected in any budget.
And we are not going to achieve any of our priorities if we
don't manage our budget, because it is going to eat away at our
ability to provide the resources necessary.
And, look, the reality is--David touched on this--but the
reality is that the budget you are dealing with is now less
than a third discretionary and two-thirds mandatory. There is
no way you are going to deal with a $20 trillion debt and not
be willing to confront the mandatory issue.
Now, I understand the politics of that, and I know how
tough it is, but if you are being honest with the American
people about the need to deal with the deficit, you are not
going to deal with the deficit on the discretionary side alone,
that is a joke, especially when you are increasing defense.
So if you are serious about doing this you have got to deal
with all of those areas. That requires discipline. It requires
a willingness to take risks. Leadership is about taking risks.
And if that willingness to do it, if that courage to do the
tough decisions is not there, you can frankly implement all the
budget reforms you want, nothing is going to happen in terms of
the major problem.
So discipline is the key, but you have really got to have
bipartisanship and a willingness to work together to make the
tough decisions necessary to deal with spending, discretionary,
defense, entitlements, and what David talked about, revenues.
All of that has to be part of the package.
The only successful packages I was a part of in terms of
budget agreements included all those elements. If you want to
deal with the budget deficit, you have got to deal with all of
those elements. But to deal with that, it needs to be
bipartisan, and you damn well need to have the cover of the
leadership. If the leadership isn't willing to back you up on
those kinds of tough decisions, you are not going anywhere.
Co-Chair Womack. Mr. Obey, a quick thought?
Mr. Obey. Yes, Mr. Chairman.
The father of the Budget Act in the House was Dick Bolling
from Missouri, who was my mentor. And I talked to him the night
before the Budget Act was scheduled on the floor, because we
had a lot of controversy with it. And I remember him saying
that unless the leadership of both parties played the numbers
straight in the budget process so that people had confidence in
the integrity of the process, that you could never expect
anybody to support the results.
And that is what has happened, in my view. You have had all
kinds of gimmicks. I mean, my God, when you take a look at the
assumptions that were made.
I remember one year good old Ed Muskie, we were in
conference. We were $400 million away from reaching the target
number we needed on the deficit. And so Muskie wanted to take
it out of agriculture.
And so in the end if you took it out of grain, you
antagonize the grain farmers; if you took it out of dairy you
antagonize dairy. And so what the committee did was to tell the
dairy guys they were going to take it out of grain, they told
the grain guys they were going to take it out of dairy, and
they passed it by subterfuge.
You have got to play straight with the numbers or you are
never going to get anybody to support it.
Second thing is your substance has to be seen as fair and
just for the people you represent. Otis Pike from New York said
this during debate: You will never be held in high regard or
deemed ethical while you say you can't balance a budget unless
a constitutional amendment makes you; while you accept
gloriously optimistic economic projections rather than deal
with real ones; while you write a Gramm-Rudman bill and then
spend days finding ways to get around it; while you let one man
make $500 million a year while thousands sleep on the streets.
And then the last thing I would note is a statement that
Bolling put in the record just prior to the debate on the
Budget Act, when he said this: The objective of budget reform
should be to make Congress informed about and responsible for
its budget actions, not to take away its power to act.
Co-Chair Womack. I thank the gentleman.
Mrs. Lowey.
Co-Chair Lowey. Thank you again for your thoughtful
testimony.
First of all, to Mr. Obey. Two weeks ago we heard testimony
from Speaker Ryan in which he endorsed the idea of biennial
appropriations, putting funding bills on a 2-year cycle. You
note that you oppose this proposal, as do I. So number one,
could you elaborate on why you think switching to biennial
appropriations would be a bad idea?
And, secondly, for either of you. One of the problems we
have been having recently is getting appropriations done,
because there is a tendency to drag in all sorts of unrelated
legislative issues into the appropriations process.
It is hard enough just reaching agreement on funding
levels, but when we become the authorizing committee, because
the authorizing committees can't do their work, and we try and
resolve issues of banking regulation or environmental law or
healthcare policy, I just wonder whether all these riders--and
I mentioned before that we were in till about 11:30 last night
on Labor-HHS, because there were 50 amendments, all kinds of
legislative issues.
Maybe you can tell me, Chairman Obey, how are these riders
handled? I am not even getting into Mr. Panetta's in-depth
discussion. But how did you deal with riders in the past? We
are becoming the authorizing committee, because the authorizing
committee can't do their work, and then we get into all kinds
of policy arguments and amendments like the 50 last night.
Mr. Obey.
Mr. Obey. Well, first of all, with respect to 2-year
appropriations, I believe that the Congress is not in any
position to give away any of its powers. It has given away far
too many through the years.
And if you take a look at what happens, if you have a 2-
year appropriation, understand, once you pass that
appropriation bill the bureaucracy doesn't need you for the
rest of that cycle.
Under a 1-year appropriation you have always got something
that they want. It is called money. And it makes it tough to
get away from the Congress if the Congress is going to have you
right back up again next year. It is hard on the Congress to
have to go through it twice, but it is the way you preserve
your power vis-a-vis the bureaucracy, in my view.
Secondly, this idea that somehow if you appropriate 1 year
you will have all of this time in the second year to do
oversight--bull gravy. The fact is that if you do that what
happens is that you lose the leverage, you lose the leverage
that you have with a 1-year budget.
Thirdly, supplementals. Congress already does too much by
way of supplementals. We funded the longest war in the history
of the country on a supplemental. I mean, it is absurd to even
think about adding a process that will make it much more likely
that Congress will have to wrestle with supplementals.
And then the fourth problem is that if you then add to it
the inclination of Members to grab what must be a must-pass
bill and attach their favorite authorizing project to it, then
you have got a prescription for chaos.
So I would say first do no harm. Don't give up the power
that the Congress has. Especially in these days, this democracy
requires that you hang on to it.
Co-Chair Lowey. Well, I thank you very much.
Do you have a comment on that, my friend?
Mr. Panetta. Just a short comment on it.
I think part of the problem is the breakdown in the regular
order process that took place. When I was first elected--and
David obviously before that--but when I was first elected, the
committees meant something. The subcommittees meant something.
And, look, we had very diverse Members in the Congress. On
the Democratic side we had everybody from Sonny Montgomery to
Ron Dellums and a lot of others. And yet, what we did was we
operated within the committee process. We had a chance in
subcommittee to do hearings, to make amendments, to vote on
that legislation. We had a chance in full committee to do
hearings and vote on legislation.
And the leadership backed up that process. The leadership
basically said: We are not going to take up bills unless they
go through the regular order process.
And you felt as a Member that you had a role to play in
terms of legislation. It wasn't being done by the leadership.
It wasn't being done by the Rules Committee. It wasn't being
done by a group in a dark office someplace. It was done by you.
You were part of the process.
That is shut down. And so, yes, you are going to get a hell
of a lot more riders. Why? Because the authorizing committees
aren't doing anything. So they are going to basically put the
riders on appropriations bills because they know appropriations
bills ultimately have to move. So you are going to get a lot
more riders with a breakdown in regular order.
And, look, the process right now, appropriations operates
on CRs. I mean, I know the work is done in committees. You try
to work through these bills. But ultimately everybody knows
that we are going to face a cliff out there, and you are going
to wait until you face the cliff to basically have to do
anything.
And so everybody plays the CR game. And that breaks down
the process that David talks about where the committees are
working on this stuff, doing oversight, doing all the things
they have to do.
Because you know what is going to happen. You know the game
that is going to be played. You wait until the cliff happens.
You wait until you have to raise the debt ceiling to push you.
And the leadership is going to get together and try to cut a
deal in order to make sure the government doesn't collapse.
That is the way you operate now. That is a lousy way to
govern.
Co-Chair Lowey. Just, Mr. Chairman, if I may just----
Co-Chair Womack. Please.
Co-Chair Lowey.----repeat a couple of facts before, so we
don't get too depressed here.
We sometimes have to take the long route to get things done
to satisfy everyone's political base. I am not saying whose.
But in 2018, for example--obviously we are dealing now with
2019--we ended up with a really good bipartisan omnibus, a
really good appropriations bill. I know because I was on the
phone every night. We got rid of 169 riders. You could ask, how
did those riders get in, in the first place? But that is
another story.
And then that takes us to last night, where we are here
with 50 amendments on the House. Senator Shelby is working in a
bipartisan way with Senator Leahy. They are bringing bills to
the floor. At some place the charade in the House may be
completed, and I have a feeling it is going to end up in a
positive bipartisan bill, because it has to.
So sometimes you have to go through the machinations,
because the authorizers aren't doing their work and they had to
bring them into appropriations. And I am not saying, and I
welcome, the reason we wanted this hearing, to hear maybe how
we could shortcut this.
But in the end after everyone has done their press release
and we deal with all the poisoned pills, we ended up with a
pretty good process. And on each of the subcommittees of which
I am a visitor and a part, there really was some good
bipartisan discussion.
So I won't throw the whole thing out, but it is an
interesting process the way it is working now, and it may be a
longer, longer process.
Co-Chair Womack. I thank the gentlelady.
Senator Lankford.
Senator Lankford. Thank you, Mr. Chairman.
Gentlemen, thank you being here very much.
Mr. Panetta, let me start with you on this. Thanks for the
very detailed recommendations that you put in place. I want to
continue what Nita was talking about as well on the 2-year
cycle.
You make a pretty strong case for having a 2-year budget
process. Would you have that same case for a 2-year
appropriations process, especially with an insight on
contracting, CRs, which you mentioned before, lost months when
you can actually do contracting?
You have been on both sides of this. It gives you a unique
perspective. So help me understand where you are coming from on
a 2-year budgeting process, 2-year appropriation process.
Mr. Panetta. Look, the reality right now is that most of
the agreements that are being made are made over a 2-year
period to try to give you some relief so you don't have to
fight the same wars the second year.
Look, the biggest problem--and I have seen it from both
sides, obviously from the Hill perspective, but also from being
in the administration, particularly as Secretary of Defense--
the worst problem in terms of defense is uncertainty and not
knowing what the numbers are going to be and not knowing
exactly what is going to be available.
And you have weapon systems that are out there that have to
be funded. You have troops that have to be paid. You have all
kinds of requirements that have to be dealt with. And you are
not sure what exactly you are going to get.
And particularly when sequestration happened, you had this
process of then slashing funding across the board. And at the
time I said it is really going to impact on our ability to do
maintenance and all the other things that have to be done.
So it is the uncertainty in the process. And I think a 2-
year process, since in many ways it is now incorporated in the
dealmaking that goes through it, I think a 2-year process that
lays it out for 2 years--look, on the appropriations side I
think Mike Enzi has a good idea of perhaps running six bills
one year and six bills the next and allowing some degree of
oversight in the offyear.
But the fact that you can lay out some degree of certainty
with regards to where you are going so that you can do the
planning and you can do the kind of decisions that have to be
done, I think that is an important thing to consider in this
process.
Senator Lankford. The connection between reprogramming
dollars with appropriations committees and for agencies having
to be able to come back for reprogramming authority, is that a
sufficient hook to be able to push agency back to
appropriators?
Mr. Panetta. Yeah. No, it always is. I think that is right.
Senator Lankford. Let me ask you, you had an extensive set
of paragraphs on budget gimmicks, with a full confession that I
occasionally used a couple when I was sitting in the other
chair. So talk to me about a little bit of how that actually
fixes the process.
You talked about ChIMPS, you talked about timing shifts,
you talked about the magic asterisk. Are there any of those
that are in particular that you say this is a big issue, or it
is just deal with all of them?
Mr. Panetta. I think you have to deal with all of them,
because, look, the nature of the way you do this process is
that it requires difficult decisions. And every time that you
have to make cuts, every time you have to deal with spending
programs it is, instead of going directly at it, if you can
find a way around it that is what happens. That is the way we
operate. And as I said, I have been part of that.
And so I can remember once as OMB Director I had
recommended as OMB Director that--it was about $8 billion, and
I recommended that on the transportation bill, instead of
allowing for people to add new projects to the appropriations
bill, that they would have to be authorized by the
Transportation Committee.
Well, it was somebody named Bob Byrd on the Senate side who
did not like that because he was able to pave a lot of West
Virginia based on the appropriations bill. And so Bob Byrd
called, called the President, and said, ``You know, Mr.
President, I am not going to be able to support your budget if
you include that provision.''
So the President called me and suddenly I was $8 billion in
the hole. And so I told the people at OMB, ``Where can we go to
come up with $8 billion?'' And we found some additional savings
in different places. But I still got down to I think it was
about $3 billion to $4 billion.
And finally I looked at my economist and I said, ``Look at
that growth number and figure out if maybe a half percent on
growth might be added.'' And that took care of the problem.
So, yeah, you are in a box, you turn to those gimmicks. The
problem is it erodes the system. It erodes the honesty of the
process. Sometimes you get to a date, and it is the end of
September, and if you can move that payment to the 1st of
October you can save money in that year. It is phony, but it is
the game that is played.
So I think if you are serious, I would look at each of
those gimmicks to try to make sure that they are not being used
because it is dishonest. It is dishonest.
Mr. Obey. If I could just make a point on that, backing up
what Leon says about dishonesty.
Jim Jones' portrait is hanging here on the wall. He is from
the same State that you are and that I was born in, Okmulgee.
And he had a big confrontation with President Reagan on the
budget in 1981. And when the time was approaching to vote on
the budget, at that point Jim Jones thought he had it won
because his budget resolution produced a smaller deficit than
Ronald Reagan's.
So what happened was that over a 10-day period the Reagan
administration simply decided that they were going to change
some of their economic assumptions.
And so then when we returned to town, lo and behold, all of
a sudden the low dollar man in terms of the deficit was Ronald
Reagan, not Jim Jones, and that is why Jim Jones lost the vote
that turned control of the floor and the Congress over to the
minority.
My point being, that is my basic objection to the Budget
Act as it stands. It forces Members of Congress to focus so
much on details and gimmicks rather than determining what their
basic values are and how they are going to deal with them. And
sometimes we function a whole lot better on an informal basis
than we do if we have to meet artificial targets that require
us to do artificial things.
And I would just show you one thing. I have got an old
chart which I held up on the House floor during that 1981
debate, and what it showed was the projection.
The deficits under Gramm-Rudman I for fiscal year 1985 to
1990, the deficits were projected to go from $172 billion to
zero in 1990.
Instead, they went from $212 billion to $220 billion. Most
of that was simply due to games that were played on economic
estimates and assumptions.
Co-Chair Womack. Mr. Yarmuth.
Representative Yarmuth. Thank you, Mr. Chairman.
And thanks to both of you for sharing your experience and
wisdom with us.
Mr. Obey, I remember well during my first two terms here
when you were chairman of Appropriations, and you were during
certain seasons the most popular person in the House, because
everybody was trying to get their congressionally directed
investments, also known as earmarks, approved.
We haven't really had much discussion in this joint
committee about earmarks. Would you both discuss what impact
you think restoring earmarks might have in resolving some of
the polarization, the conflicts that we have in the process
now?
Mr. Obey. Well, I am yes and no on it, because I have been
in the middle of that fight for so long.
The problem is that Congress ought to have the right to
determine where money goes on a district-by-district basis to
at least some degree. They shouldn't be able to decide it all,
but if I represented my district for 42 years I think I had a
hell of a lot better idea of what was needed for different
communities than the OMB Director did.
The problem is that that is true for 90 percent of the
Members, but then you have always got 1 or 2 percent who foul
the nest by getting greedy, by getting slippery, or sometimes
even sleazy, and it gives the institution a bad name.
So I guess what I would say is, in theory, I would like to
see earmarks restored because that represents one manifestation
of congressional power. But when I see what it does to the
institution it is very hard for me to recommend that they
restore those, if you can find some way.
The other problem you have is when you start to explode the
number of earmarks. The Labor-H bill went from zero earmarks to
over 4,000 earmarks within a 4- or 5-year period. That eats up
an enormous amount of staff time just checking out the project
to make sure that somebody isn't pulling a fast one.
And so it is a prerogative that the Congress ought to have,
but I would rather look elsewhere for preserving the Congress'
constitutional authority.
Mr. Panetta. I am a supporter of allowing Members to do
this, because I think Members are elected to represent their
constituents. And if there is a need that your constituency
faces, you ought to be able to have the opportunity to go to
the key chairman and members of a committee and justify
providing funding for that particular effort. I think that is
part and parcel of your responsibility as a representative of
the people.
There are ways to try to check this. I think the reason
earmarks became such a target is because they got out of
control. Huge numbers were added to certain bills. I think they
created real problems. Some of those earmarks were unjustified.
That created real problems.
But I think if you have a limited number and you have
greater transparency in what is included in earmarks so the
public knows what is a part of it, I think there is a way to do
this.
And I have to tell you. From the approach of running this
place, from the approach of being in the administration as
chief of staff trying to be able to get things done up here,
the ability to be able to focus on what somebody needs is a
very important incentive to trying to urge that individual to
do the right vote.
And I think having given that up has really hurt both the
leadership and it has hurt the ability of administrations to be
able to work their will on the Hill.
Representative Yarmuth. I appreciate that.
Mr. Obey. I agree with that, too. Let me just one point.
One of our problems is we know so many things that ain't so.
And the number one project that got Congress into trouble on
earmarks was the Bridge to Nowhere.
But guess what? Number one, that was not done by the
Appropriations Committee, it was done by the authorizing
committee. Number two, the money that went to that bridge came
out of Alaska's share, it didn't come out of anybody else's. So
the Congress took a real beating for stuff that wasn't so.
Representative Yarmuth. Thank you very much.
Co-Chair Womack. Senator Blunt.
Senator Blunt. I am no expert on the Bridge to Nowhere, but
I think number three is it actually went somewhere, under the
circumstances you mentioned.
Not much good said about the Senate. The Senate is designed
to be a disappointing institution, and we fulfill that.
But I appreciate Co-Chairman Lowey's comments that we have
tried this year. We got all of our bills out of the committee
by the end of June, moving those bills in packages. We don't
have a lot of history here in recent years. Somebody could walk
off the field at any moment.
But not allowing the appropriations process to become the
authorizing process is important. There are times when
authorizers and appropriators and everybody else agrees this is
a moving vehicle, this is something that needs to be done, this
is the moment to do it.
And then the other comment that Congresswoman Lowey made is
she is leaving here to go to a conference committee.
Co-Chair Lowey. It cancelled.
Senator Blunt. Now this is a much more unique thing than it
would have been a decade ago, the idea of going to a conference
committee.
And to go back to my other comment, anybody could walk off
the field at any moment. And Congresswoman Lowey said the
committee meeting was just canceled. But we both voted to go to
conference, and we are ready to go to conference. And maybe
some experience.
Part of the problem is we haven't had a real number since
the Budget Control Act. And I think both of you have addressed
that in different ways. You have to have some agreed-to number
to know how you are starting.
So one reason this year might work better than last year is
last year we weren't shooting with real bullets until about
November, when there is an agreement, okay, here is the real
number we are going to use.
The whole process, the budget process, the spending
process, the entire process is based on we know so much that
isn't so, like Congressman Obey just said, we know this is not
going to work out this way, makes it really hard to get in and
do the work that we need to do.
A couple of thoughts. One, I don't think it is coincidental
that the real breakdown in the process ended about the same
time Members didn't have anything to go home and specifically
talk about.
What about the idea that Senator Byrd objected to that you
can only appropriate things that were authorized, with the
transportation caveat? But would that be a way back to where
Members had more reasons to talk about what they had voted for
than we currently give them?
Mr. Panetta. I think it is important. I did it as OMB
Director, frankly, I did it as chairman of the Budget
Committee, was to really stress the importance of the
authorizers to do their job in authorizing particular spending,
rather than having the Appropriations Committee have to totally
carry that ball and have to deal with unauthorized projects of
one kind or another.
You know, the problem I see now is, as I said, when I was
here every one of these committee rooms was working. There were
subcommittees meeting, there were full committees meeting. You
know, the committees I served on were having hearings. They
were doing markup. They were in business.
And, frankly, the chairmen of those committees and the
ranking members would not have it any other way. The chairmen
of the authorizing committees said: You damn well are not going
to move this through appropriation because it is my
jurisdiction.
That is the way it used to operate, and that has broken
down, and I think it has made the problem that much worse.
Senator Blunt. I want to get to calendar year. One of your
recommendations was we would have more time if we worked on the
calendar year rather than the current fiscal year. I would like
both of you to comment on that.
That is your recommendation. So, Congressman Obey, do you
want to start? Would that make this process work any better
than where we currently are?
Mr. Obey. I don't really care. What I care about is whether
or not you can get your work done.
Senator Blunt. Right.
Mr. Obey. And I just think that if you eliminated the
budget, the necessity to pass the budget resolution, if you
went back to the old system of simply informal agreements
between the leadership and the committees about how much ought
to be spent on this, that in that area, you would have a lot
more time to deal with appropriations. I think that would be a
bigger change.
Senator Blunt. So you would buy that extra 3 months by just
eliminating the budget process.
Mr. Obey. Yeah. And if you want to do it, if you want to do
the additional, or if you want to move the date, as well, I
don't care. I don't know if it would help or hurt. But I do
know that right now we are spending a hell of a lot of time on
an institutional press release that doesn't spend a dime.
Senator Blunt. Secretary Panetta.
Mr. Panetta. You know, I mean, I understand David's point.
And, frankly, at that time Appropriations, Ways and Means, I
think there was a process that they abided by.
But the reality is that you are now operating in a
situation where you are facing trillion-dollar deficits. You
have got a $20 trillion debt that is going to explode in the
outyears, all of the projections say what is going to happen.
And I don't think you can do this just simply by
Appropriations and Ways and Means because of the tough
decisions that are going to be necessary in order to put this
back on the right track. That is the problem.
Appropriations is not going to do that on their own. They
don't deal with mandatory. And Ways and Means is not going to
do what they have to do without some kind of mandate from the
budget process in terms of reconciliation the way it is
supposed to work.
So I think the reason you have got to put a better process
in place in terms of the budget is to try to deal with the
challenges we are facing as a country in terms of trying to
ultimately put this country on a better fiscal track over the
next 5 to 10 years. You are going to need that kind of budget.
I know how appropriations operates on a year-to-year basis.
I know how Ways and Means operates on a year-to-year basis. But
the bottom line is you are not going to deal with the elements
of the budget that have to be dealt with in order to improve
our fiscal situation without having at least a committee that
looks at the whole picture.
Co-Chair Womack. Senator Bennet.
Senator Bennet. I guess I would like to start where you
ended.
First of all, I wonder whether either of you would be
willing to run for Congress again, based on your testimony? And
while you are considering your answer to that let me ask this
question.
After 10 years of budget press releases and cliffs and
wasting money for the Defense Department and shutting the
government down, all in the name of fiscal responsibility, we
find ourselves in a place where next year, I guess, we are
going to collect about just under 17 percent of our GDP in
revenue and we are going to spend almost 21 percent spending as
a percentage of GDP.
That will provoke, create the largest deficit that we have
had as a percentage of GDP in the Nation's history outside of a
war or recession.
And, Secretary Panetta, you mentioned earlier that the way
you see it, it is either management by crisis or by leadership.
Leadership is better than crisis. But there is not a lot of
leadership around here, and I am really worried about a crisis.
And I wonder whether you could both sort of help us
understand what the conditions are, the political conditions,
you are both politicians, what they need to be for us to
actually address this issue, grapple with this issue in a
meaningful and responsible way, what the process, Leon, looks
like that you are talking about really. I mean, if you were
here, what would it look like to drive a budget agreement that
dealt not just with discretionary but mandatory spending, as
well?
And then finally, if you could each just say a word about
what it would mean for Members to actually take back some
responsibility from leadership. There are a lot of us that have
worked here throughout a time when there has not been any
opportunity for Members to make decisions about the kind of
things you are talking about.
So any perspective on any of that I would appreciate.
Mr. Panetta. Well, that is the issue that I really struggle
with, which is, how can this place get back to governing? And
in many ways that is the bottom line. You are elected to
govern. You are not elected to come back here and pound your
shoe on the table and simply play politics. You are elected to
come back here to govern. And governing involves some tough
decisions.
And the issue is, how can we get back to that? Because I am
not so sure, frankly.
When I was here, governing was good politics. It made sense
for me to come back here and work, even if it was a Republican
administration, a Republican President or a Democratic
President.
If we governed and did what we thought was necessary, found
the right consensus, found compromise, got things done, even
though my constituents might not always agree with my
positions, they knew we were governing and running the country.
I am not so sure right now that governing is considered
good politics as opposed to stopping the other side from doing
what they want to do.
You guys are engaged in trench warfare up here. You are in
your trenches, and you are fighting this war, and you are
throwing grenades at one another, and every once in a while you
come out of there. You are worried about somebody shooting you
in the back if you try to negotiate something. And so nobody
wants to go into no man's land, so you stay in the trenches.
How do you get break that? How do you get back to
governing? That really requires tough leadership that is going
to have to take risks.
Look, when David and I were here it was not only the
leadership. I mean, look, Tip O'Neill and Bob Michel used to
kick the hell out of us if we didn't get the budget resolution
done. They backed us up on tough enforcement. Tip used to
constantly say, ``When are you getting the budget resolution
done? We need it done.'' And they were pushing, they were
pushing, and backed it up.
And so you need to have that leadership at all levels. We
had chairmen, strong chairmen at the time, people like
Rostenkowski, people like John Dingell.
And let me tell you something, these were not chairman who
just kind of sat back and waited to see what the hell the
budget was going to give them. They basically used to come to
me and say, ``What the hell are you up to? What are you
doing?''
And I had to visit every chairman. When I was budget
chairman, I visited every chairman to try to make sure that
they were informed of what was going to happen, because
otherwise that chairman had the power to throw the whole damn
thing off track.
So because there was leadership at those key levels and all
of them wanted--I mean, they thought--it was abhorrent if we
didn't pass a budget resolution. I mean, Tip O'Neill, Tom
Foley, everybody was on my butt in order to make sure we got
it. They cared about that.
If that is not there, if that pressure is not there, if
everybody sees that you can take shortcuts in the process, it
is not going to happen under any circumstance.
The other thing, very frankly, is you need a President of
the United States who cares about this stuff. I mean, if a
President of the United States really cares about this stuff
and is willing to convene bipartisan leadership to focus on the
tough choices that need to be made and is there to back it up,
let me tell you something, then you will see things happen.
George Bush made the pledge, ``Read my lips, no new
taxes.'' And I remember as Budget chair he asked me to come up
and talk to him after he soon got elected. And I said, ``You
know, Mr. President, let me tell you something. You are not
going to be able to stick by that, because the deficits are
going up, and you are going to have to confront that.''
And he said to me, ``Frankly, look, I can't back away from
that now, but there will be a point at which we will have to
sit down and negotiate an approach.''
And to his credit, it was tough for him. I understand the
politics of this stuff. It was tough. But he was willing to go
ahead and negotiate, Republicans, Democrats, and that is what
led us to the 1990 budget agreement.
It took courage. It took courage. You know, he may well
have paid a price for that. But you guys are elected to
exercise leadership. And I think, unless you bring those
ingredients to bear, Members on their own are not going to
touch this stuff because it is volatile.
You are not going to deal with entitlements. You are not
going to deal with raising taxes. You are not going to deal
with all of the issues you have to deal with, because it is
trouble. Doing that on your own, it would be nuts.
But if you knew you had the cover of leadership, and you
knew that there were people that were going to protect you in
making these tough decisions, then there are Members that are
willing to walk that line. But if that is not there, this is
tough to do.
Co-Chair Womack. Senator Ernst.
Mr. Obey. If I could just comment on something Leon said.
My problem with all of this is that we are all talking
about what we do on the process and in order to solve a
political problem. The problem the country is facing is not
process, it is political. It is political. It is political. And
everything else is just avoidance. You can't deal with the real
problem on this committee.
Start with districting. I was elected for 42 years from a
52 percent Democratic district. That meant that I had plenty of
incentives to try to find independent votes and some Republican
votes on a good day, and that is what it took to get elected in
a district like that.
Today we have got too damn many 72 percent districts rather
than 52 percent districts. And as a result there are no
incentives to legislate. There are no incentives to compromise.
Do you think Joe McDade could do today what he did with me
when I got him to agree to a bipartisan 302(b) allocation out
of Appropriations? Do you think Joe McDade could do that today
without having his head handed to him? Like hell. No way on
God's green earth that he could do that.
Do you think that I proposing a joint 302(b) allocation
back in those days in 1994, do you think I could do that under
this atmosphere today? I sincerely doubt it. So you have got
the districting problem.
And then you have got campaign finance. The major reason I
retired--I love this place--but the major reason I retired is
that I knew in a 52 percent district I was going to have to
spend all of my time being a glorified telemarketer raising
dollars, and that is the last damned thing in the world I
wanted to do when I came here.
And so it is what the political system is doing to
everything else. We are not attacking the Medicare. We are not
attacking healthcare in a constructive way. Parties are looking
for a way to one-up everybody else. And you have got to have
some incentives built into the system or it is just a bunch of
high-minded talk that isn't going to get us anywhere.
So you have got to look beyond the process issues, and then
if you could somehow change the political atmosphere process
will take care of itself, because Archy the Cockroach is right.
What counts is not what system you have, what counts is what
you do with whatever kind of system you happen to have.
Co-Chair Womack. Senator Ernst.
Senator Ernst. Thank you to our witnesses today. It has
been really good to hear from both of you.
And I appreciate, Secretary, your words on leadership and
courage and assuming that risk. And the issue that faces this
committee, though, is what do you do in the absence of
leadership?
So we are tasked with coming up with a plan that will move
our Congress forward. And so a number of different discussions
have gone on here. You both have laid out different ideas on
how we could reform the process if the process is to be
reformed.
Mr. Obey, you mentioned the incentives. Sometimes those
motivating factors can be punitive, as well. And one of the
things that we have talked about as far as incentives for
Congress to get their work done is to perhaps withhold Members'
pay, their recess, travel, until we get a budget in place.
Because no matter what process we have in place, I don't
care what it is, I am going tell you, and you know this,
Members of Congress are always going to find a way around that
system. And we will end up with CRs, we will end up with other
gimmicks.
What do you think about those ideas, no budget, no pay, no
budget no recess? Could you both maybe talk a little bit about
those ideas?
Mr. Obey. What do I think of those ideas? Not much.
Senator Ernst. Can you expound?
Mr. Obey. I don't really think I need to. I mean, if you
are a freshman legislator in the House of Representatives and
you come in here, and the institution fails and doesn't produce
a product, why should that individual Member pay the price for
the idiocy of the institution? I don't think they should.
Senator Ernst. Secretary.
Mr. Panetta. I know all the thoughts about trying to force
doing what is right. This is a cycle we always go through. I
remember when I was on the Budget Committee that same kind of
politics as now. Republicans didn't want to raise taxes.
Democrats didn't want to cut entitlements or spending.
And so if people weren't willing to confront those issues,
then everybody was thinking: What is the shortcut here? How can
we do this without having to really face those tough decisions?
And so people were coming up, obviously, with a balanced
budget amendment for the Constitution. I mean, Gramm-Rudman was
basically the shortcut. I mean, Gramm-Rudman basically said
let's just set this path and cut the hell out of everything in
order to stick to that path. Well, it is one way to do it, but
the problem is Congress never stuck to it. And so we always
found a way around it.
I think, frankly, the greater key is to, if you come to a
decision on this joint committee to establish some changes or
reforms, then I think it is absolutely essential for the
leadership to require that you abide by those changes. And I
think they are the ones that are going to have to push Members
to then take the steps necessary to get it done.
That is the best way it works, is to have them lean on the
people that have to do the right job. And they have ways to
basically be able to twist arms. They have to do it every day.
And there has to be, I think, peer pressure that basically
comes at play here so that everybody is pushing to adhere to
it.
I think if you establish penalties of one kind or another
the problem is that not only will Members feel that that really
is overstepping the line in terms of hurting them, but more
importantly, what will happen is they will find other shortcuts
to trying to get the job done, because then their pay or
whatever will be on the line so they will find another
shortcut.
I think what you want to do is find a way to make sure they
stick by the process.
Mr. Obey. Let me just say, there is an assumption here, I
think, that the leadership is always going to do well.
Sometimes the leadership is incredibly ignorant on specific
problems facing committees. I will tell you one story.
Bill Young, when Bill was chairman of the House
Appropriations Committee and I was ranking member, Bill and I
were very close. I really loved him.
And he came up to me one day, he said, ``I just got to talk
to somebody. You have no idea what just happened to me.''
I said, ``What is that?''
He said, ``I was in my office, and the phone rang, and it
was Speaker Hastert. And he said, 'Bill, we have got a
rebellion on our hands and I need to talk to you about it
quick. We need you to come right down here to my office.'"
So Bill went down, he walked into the Speaker's office, and
the Speaker said, ``Bill, we have got a number of our junior
Members here and they are upset with no progress, and they are
demanding that we move appropriation bills. How soon can you
start moving those damn appropriation bills?''
And Bill looked at him and said, ``Well, Mr. Speaker, first
I have to have an allocation.''
And the Speaker said, ``What is an allocation?''
The way this place needs to work, political parties have a
very legitimate role to play. But the kind of politics I was
taught was that the leaders of both parties would decide the
direction they wanted to take their caucuses and their parties
nationally. They would decide what direction they wanted to
take, and they would put together their ideas on how to do it.
Then you bring it into the Congress. And then what the
committees are supposed to do is to leaven that product with
the knowledge that individual committee members have picked up
through years of working to understand this stuff.
And there is an advantage if you have got somebody who has
been on Labor-H for 12 years and knows, really knows how NIH
works. Committees are supposed to be able to know enough to
persuade the leadership to modify their product so that it will
stand the test of political reality when it hits the newspapers
and when it hits the floor.
And so you need a balance. You need a balance between
strong leadership also needs to be informed leadership, and
then also super informed committee members who know enough
about these individual programs to know what is a good idea and
what isn't. And maybe you ought to modify the Speaker's pet
project in order to make it saleable.
I am proud of the fact that in the years I was chairman
Nancy Pelosi never ordered me to do anything. If she wanted me
to do something she would come in and she would be mighty
persuasive.
But in the end if I said, ``Nancy, I am sorry, but here is
why I can't do this,'' she would listen. She might not like it
and she might raise hell with me and ask me to change my mind,
but she respected my knowledge and I respected her obligations
and her knowledge.
Senator Ernst. And I appreciate the input. If I could just
wrap that up, I do believe that we will find a way around any
process if there isn't something that is forcing us because of
all the things that you outlined with partisanship and so
forth.
So I do support having measures in place to force us to do
our jobs because, unfortunately, with the dynamic we have right
now we are not doing our jobs and we don't have the leadership
that compels us to do our jobs.
Thank you.
Mr. Panetta. I think as long as you are thinking about
that, I mean, I think, rather than kind of going after pay or
what have you, I think trying to clearly set an approach that
says legislation that does have a fiscal impact will go nowhere
without a budget being approved. I think you need to turn to
the process and what needs to be done, and then the price you
pay is that you can't just simply find ways around it, avoiding
the necessity for some kind of budget.
Senator Ernst. Thank you, Mr. Chair.
Co-Chair Womack. Thank you, Senator.
Mr. Kilmer.
Representative Kilmer. Thanks, Chairman.
Thanks for being with us.
Maybe, Mr. Panetta, I will start with you. I am struck that
process changes and enforcement mechanisms only really work
when they are implementing and enforcing policies for which
there is a bipartisan political consensus, and when there is
not that political consensus they break down.
So at one of our prior hearings Maya MacGuineas was here
and talked about ways you could increase the transparency and
awareness of some of the fiscal challenges that you have spoken
so eloquently to.
One of the suggestions that she spoke to was having some
sort of a fiscal State of the Nation address where the GAO or
the Comptroller General would come in and actually lay out some
of our long-term fiscal challenges. I wanted to get your
impression of that.
Mr. Panetta. Well, I think those are all good ideas. I
think having some kind of summary or some kind of report or
message with regards to our fiscal health is important.
But, frankly, that is the responsibility of the President
of the United States. And we have not really in recent years
had Presidents address this country on the fiscal crisis that
we are facing, largely because Presidents are like everybody
else, that would interrupt their ability to get the money that
they want to get for the spending that they want to do.
And so there are very few Presidents in recent years who
have really spoken clearly to the American people about the
kind of crisis we are confronting. And I think the result is
that everybody then thinks you can tiptoe past the graveyard,
and nobody pays attention to the level of crisis that we are
confronting.
And one of the reasons we were able to pass the 1990 budget
agreement and the 1993 budget agreement was because Ross Perot
in his campaign made this an issue. You need to have at a
national level somebody who is willing to address the crisis we
are confronting.
Representative Kilmer. Mr. Obey, I enjoyed reading your
testimony and the references to Archy the Cockroach made me go
on Amazon and buy ``Raising Hell for Justice.''
So I had already read ``Worthy Fights,'' for what it is
worth, Mr. Secretary.
I wanted to echo the observations of Chairman Lowey. You
have seen this interesting dynamic this year where the Senate
has committed to a bipartisan process, agree on 302(b)'s, not
having the partisan riders, a very different process than the
House. I got an opportunity to think a lot about process reform
during our 13th hour of markup last night.
I am struck that the Senate hasn't been more successful in
finding success because of rules or process, but because they
have made a commitment to a bipartisan and consensus bill
process.
Now, having said that, in your testimony you made reference
to reconstituting the Budget Committee so that it more
accurately reflects sort of the realities of what is coming out
of Ways and Means and of what is coming out of approps. I was
hoping you could just speak a bit more about why you think that
would improve the budget process.
This is for you, Mr. Obey.
Mr. Obey. Well, I think there is a very good reason why the
Senate appears to be working in a more bipartisan way than the
House is on this stuff, and it is called districting. It is the
way the lines are drawn.
If you are in the Senate you represent the whole mixture of
pressures and counterpressures in a State. If you are in a
House, and if your legislature has drafted it so that Democrats
and the Republicans are super safe, then they don't have any
pressure to compromise.
In fact, the pressure is just the opposite. If you pull a
Joe McDade and try to work out a compromise with Dave Obey, you
are going to get skinned by your hard right. And if you are
Obey trying to work out a compromise with McDade, the same
thing might happen.
So, I mean, we can talk all we want about these little
issues. They are all around the edge issues as far as I am
concerned. What counts in the end is what kind of incentives
you have in the system besides human nature. What kind of
system do you have built into the system to pressure people to
do what is for the good of the order. And the only way you get
that is to change, redistricting. I think you also need to
counterweight the incredible role of money in this place.
And, thirdly, you have got to have a party leadership who
is going to pull the main single issue groups in your umbrella
into your office and tell them to go to hell, that you are
going to do what is right and you need their help to do what is
right, and if they want to hit you with their priorities after
A, B, and C are done, fine, but until then to hell with you.
I mean, until you get that kind of approach from our
leaders, until they mean it, and until the involved citizens of
this country decide that it is more important to get something
done than to have me win all the time, we are just going to be
going nowhere.
This is a crisis. Yes, the debt and the deficit is a
serious problem, but it is not the crisis that we have with the
crisis of confidence in the political system right now. That is
the real crisis. And I don't see much real work being done on
that.
Representative Kilmer. Thanks, Chairman. I yield back.
Co-Chair Womack. Senator Perdue.
Senator Perdue. Thank you, Mr. Chairman.
I would like to thank both the co-chairs for these
outstanding witnesses today. And I so respect their
contributions, their careers.
And I thank you both for being here today. It has been very
fascinating.
I have only been in the Senate 3 years. I am on the Budget
Committee. I come from a business world where this conversation
is alien to me. I mean, we fund things. We do budgets like
breathing. You have to.
Biennial? I don't know any corporations that do biennial. I
know a couple States do.
The last 3 years we have been looking at best practices of
other countries, States, and companies, and I can't find
anybody that has a budget resolution that is not a law, leads
to an authorization that really hasn't been done in two
decades, and then an appropriation process.
I believe, frankly, after looking at this in depth--and I
want to get your opinion on two questions very quickly, and I
will get to it very quickly--I think this whole process was
doomed the day the 1974 Budget Act was enacted. It has never
worked. It can't work. It will never work. It has only funded
the government on time four times in 44 years.
And, Secretary, I think 2 of those years were on your watch
in the nineties. There were 2 years in the seventies right
after it was enacted. Other than that, we have always used
continuing resolutions. As matter of fact, we used 177
continuing resolutions in those 44 years.
And actually, and we don't write about this much, but
Congress has actually shut the government down 20 times during
that period of time.
Now, you talk about breeding confidence with the
electorate. I am sorry, but that just doesn't do it.
So my question is twofold. I think there are two levels of
issues here. One is, how do we fund the government on time
without all this drama without the use of CRs? That is the
primary focus of this committee.
But you both bring up the second dimension of this, and
that is dealing with this debt crisis. I thank you so much for
calling it a crisis because sometimes up here we just kind of
skip past the graveyard here on this thing.
How do you ever get at the spending issue if you don't
really consider all of your expenses? Let me be a little more
direct. And I would like, Chairman, you, and, Secretary, both
address this, if you will. We spent $4.3 trillion this year in
total expenses. About 1.3 of that is discretion. The balance of
that is mandatory.
By definition, in the Senate the Finance Committee is in
charge of Social Security and Medicare, and so in theory you
think, well, okay they are in charge of mandatory expenses. But
they never really get looked at by the definition of mandatory.
So the question is, how in the world should we be thinking
about--I don't know any other budget process in the world that
doesn't budget its full expenses. And it forces you then to
look at the withholding equation on the revenue side, on Social
Security, the same thing on the Medicare side.
We are told the Medicare trust fund goes to zero now in 8
years. I don't know any other better definition of a crisis
than that.
Help me understand how we are going to ever solve this if
the budget authorization and funding process, appropriation
process, only deals with 25, 30 percent of what we spend. And
how would you recommend we think about that, Secretary?
Mr. Panetta. Well, you can't do it. You can't do it. You
are not going to solve the problem facing this country unless
you deal with all aspects of the budget. That is the reality.
And people have tried to avoid dealing with certain aspects of
it. And so the result is that it distorts the process.
I mean, the idea that you can--you increase defense, leave
mandatories alone, and simply go at it through the
discretionary accounts, you know, you are kidding yourself in
terms of whether or not that is going to deal with the larger
crisis that you are confronting.
So it seems to me that if--I mean, if the budget process is
going to count for anything, the only justification for the
budget process is that it looks at that bigger picture.
And that should be the responsibility of the Budget
Committee, to look at that bigger picture and where we are
headed and then to deal with each of those elements. What are
we doing on discretionary spending? What are we doing on
defense spending? What are we doing on mandatory spending?
I mean, I think mandatories, frankly, ought to be part of
the budget process, and looking at the different mandatory
programs. How they are being spent? What kind of trouble are
they in? How effective are they? Because a lot of this stuff on
autopilot has been going on for years without taking the time
to really look at the elements of it. So that ought to be part
of it.
And, very frankly, revenues have to be part of that, as
well. There is a revenue part of the budget that is extremely
important to the entire picture.
You have to look at all of that. And the only way you are
going to be able to address the level of crisis that we are now
confronting, and it is like a business, you can't run a
business and not look at every aspect of your costs in that
business.
And if you do that you can get the costs down. Tough
decisions. You may have to fire people. You may have to do
things that cost you money. They are tough decisions. But that
is what running a business is all about.
Well, the same thing is true here. You want to run the
country, you are going to have to make some tough decisions on
these issues.
And it is the process of avoiding those tough decisions
over these last 12 or 15 years that has gotten us into deeper
trouble. It is easy to spend money in this place. It is easy to
cut taxes in this place. But when you have to pay the piper,
when you have got to say what are we doing to the deficit, what
are we doing to the taxpayers in this country, then people try
to find a way around that responsibility, that accountability.
And somehow, unless we get back to that larger process of
looking at the larger picture, we are going to continue to try
to find ways to get around the responsibilities that we have.
Mr. Obey. I guess what I would say is that we need to
remember that there is no requirement in a democracy for a
happy ending. There just isn't. And we aren't going to have a
happy ending unless we recognize that some fundamental things
have to change. And I go right back to redistricting.
I think it is modestly possible for the Senate in the end
to tackle these issues. I think it is highly unlikely that the
House will be able to successfully attack these issues so long
as you have the same people coming here time after time.
It used to be fun to solve problems. I mean, when I chaired
the Foreign Operations Subcommittee, and Nita was a member of
the subcommittee then, when we went to conference the Senate
chair was Bob Kasten from my own State. And before we sat down
in conference I sat down with my staff, and the very first
question I always asked was, ``What does Bob have to have in
the end in order to sign up?'' And we would work from that
point.
When I became chairman I was naive enough to think, ``Aha,
now that I have got the gavel I can do things my way.'' No way.
I mean, I discovered that the job of a chairman is to find that
point at which you get 218 votes. That is the job of a
chairman. And then secondarily, if he can also in the process
push his values and his favored programs, that is a bonus. But
first you have to get things done.
And so until we change the basics I don't see how we get
there. I wish I did. I know that political consultants will say
never leave them with a downer. I am sorry, I see the downers
right now, and I wish I didn't.
Senator Perdue. Thank you.
Co-Chair Womack. Representative Woodall.
Representative Woodall. Thank you, Mr. Chairman.
And thank you all both for being here. I was a young
staffer during both of your tenures here.
I remember just as much color from you, Chairman Obey, on
the floor then as you are giving us today. I thank you for
that.
I stare at your picture, Mr. Secretary, day in and day out
on this committee.
I appreciate in your opening that you said we actually have
a responsibility as a joint committee, not just an opportunity.
I have always thought of it as an opportunity, but the truth is
we do have a responsibility to get something done.
The biggest disappointment of my short congressional career
was the supercommittee that had an opportunity to look at every
single dollar of government spending, take it directly to the
floor to avoid the politics that you all have both talked
about, and they couldn't find a single dollar on which they
agreed.
I wanted to focus on that just for a moment, coming from a
regular order appropriations process. Coming from both an
Article I and an Article II spot as you do, Mr. Secretary, what
do you think about that supercommittee process, where you say
we are going to try to bring together some thought leaders and
we are going to bypass the regular committee process and send
some tough decisions directly to the floor if the authorizers
are failing to handle it on their own?
Mr. Panetta. Look, I always thought as Budget chairman that
it was our responsibility to make those tough decisions. And
the fortunate thing is at the time I had the broad support of
leadership, the President, and others, to be able to take those
steps.
I also understand that that may be impossible right now,
particularly as far as the House is concerned. I don't think it
is impossible in terms of the Senate, but I think it is
impossible in terms of the House.
And for that reason I was a little bit--I was concerned
that when Simpson-Bowles made their recommendations--and the
President asked me about that. And I said, ``You ought to
endorse what Simpson-Bowles did.'' Because, very frankly, it is
bipartisan. Tough decisions were made. I think you might not
agree with all the recommendations in it.
But I think it is important to endorse the process. And he
was concerned about some of the particular recommendations. I
understand that.
But I think you may have reached the point where you may
need to have a Simpson-Bowles-type commission, be able to make
recommendations that deal with each of the areas I just talked
about, because I don't see that happening otherwise. And, very
frankly, unless you have those decisions in place, I am not
sure that process alone is going to get you there.
Representative Woodall. I look around at particularly the
newer Members who are here. They came because of the sense of
urgency that you all both describe. And I see lots of Members
that would be pleased to cast that deciding vote. If all they
had to trade for the future security of the country was the job
that they have today, they would happily trade it away.
I have always said the happiest folks on Capitol Hill were
the Democrats who lost their job over the Affordable Care Act.
What a small price to pay for doing something that you thought
was going to move the country in the right direction.
But thinking about doing big things, 1983 Social Security
amendments. No one was poor-mouthing those changes. Raised
taxes, reduced benefits, raised ages, did all the tough things,
but everybody was on board collectively, and so we all were
touting our successes as a body and as a Nation instead of bad-
mouthing them.
You mentioned, Mr. Secretary, what Ross Perot did to allow
the 1993 Reconciliation Act, but as I remember that act, there
was not one Republican vote for that on the House side, it was
strictly a partisan bill.
I go back and look at the budgets that you were able to
move through the House. Time and time again not a single
Republican vote on the floor of the House.
We sometimes talk about the good old days as if they were
really pretty good, and the fact is this partisanship has been
going on a long time.
I value the three-step process, a budget where people can
stake out a political vision, an authorizing process where
perhaps I am going to overpromise because I don't actually have
to come up with the dollars, and an appropriations process that
now the rubber meets the road. It lets some political steam off
the pot.
In the name of process reform we have talked about reducing
those steps. Chairman Obey recommended abolishing the Budget
Committee in his opening comments. Tell me about how that
lets--the potential for letting steam off the pot in a three-
step process versus the burning of time that could be used more
productively elsewhere.
Mr. Obey. Well, I don't see much to recommend the existing
system. I mean, the problem you have, just look at Hal Rogers'
problem when he took over for me as chairman of the committee.
And take a look at the transportation bill which he tried to
bring to the floor.
I mean, that transportation bill contained the reductions
that were necessary in order to meet the targets of the budget
resolution or the assumptions of the budget resolution. And
what happened to him? He got chewed up alive. I mean, because
in my view the Budget Committee overreached.
It is easy to do that. If you come up with a bright idea,
it is easy if somebody else has to implement it, because you
can only squawk about the imperfections of the latter guy's
style that were to blame. That is not what the problem is.
In my view, the Budget Committee in recent years has
overreached because they thought it was more possible--or it
was possible to do more than, in fact, was possible.
I don't like supercommittees because the whole idea of
committees in the first place is to take the people who know
the most about a subject and put them to work on it. And
usually with supercommittees you have got people who, as I said
earlier, they can fly at 30,000 feet, but they don't have to
then explain to granny in a nursing home why you are going to
have your benefits shaved back this year.
So to me what is most important first is to understand. We
need a sense of balance. Yes, we have a budget deficit, and
that is a serious problem. We also have an infrastructure
deficit. We also have an education deficit, if you want to talk
about education.
I mean, the problem with the Bowles committee is that
expectations around here before it was established, people
would say, ``Oh, domestic discretionary, they are not the
problem. They have already been cut.'' And then each time
recommendations came up they cut further in domestic
discretionary.
So I just don't trust wise ones at the top who don't have
to implement whatever reductions you are talking about. To me,
I don't like the product that the Ways and Means Committee
produced in this Congress, but at least they had a level of
knowledge about it that is higher than a lot of people who
would have been likely to be appointed to any commission to
look at the same problems.
Representative Woodall. Mr. Chairman, can I just ask, I
know Mr. Obey is speaking with heart as an Article I servant.
Could I just ask the Secretary whether or not he is giving us
advice today on behalf of Article II or on behalf of Article I?
Where does your heart sit, Mr. Secretary, having served at
both ends of Pennsylvania Avenue?
Mr. Panetta. You know, my view is that Article I and
Article II both have to work together in order to govern the
country. And if the President of the United States thinks that
he is going to be able to get this done without a partnership
with the Congress and the ability to get it done, then he is
wrong, it ain't gonna happen. And if Congress thinks that
somehow they can make this process work without the executive
branch and working with him, I think that is also a mistake.
I think what is missing in particular with these last few
years, I mean, look, with Republican administrations that I
worked with at the time that I was here, we had a very strong
working relationship. I worked very closely with Dick Darman
when he was OMB Director. I worked very closely with Jim Baker
when he was operating out of the White House. And they would
come up and we would sit down and we worked through these
issues.
And the ability to have that kind of partnership, the
ability to have that kind of consultation is what makes our
democracy run. And the inability to have that when you try to
basically force your way through in a particular way, that is
what undermines, I think, the effectiveness of our democracy.
So you can make this process work if there is trust. I
mean, the biggest problem right now is there is a lack of trust
between the branches and between Members and between the people
and this institution. There is a lack of trust. And, very
frankly, if you don't have trust in our democracy it is not
going to work.
And somehow we have got to find a way to restore that
trust. And the way you do that is by talking to one another,
talking with people in authority, respecting who they are,
listening to them, and then trying to figure out a way for both
of you to be able to get it done. That is the way our
Forefathers designed it, and that is the way it is supposed to
be.
Co-Chair Womack. Mr. Arrington.
Representative Arrington. Thank you, Mr. Chairman and Madam
Chairwoman.
I agree with Senator Perdue, our panelists have been
outstanding. And the thought that reoccurs to me is with the
wisdom and intellect and experience of all the folks that we
have had come before this committee, if we can't at a minimum
improve the process we are in deeper trouble than I even
thought as a new Member.
And by the way, Mr. Secretary, I really thoroughly enjoy
working with your son Jimmy. He is one of those American first
guys. He is a dad first. He is a Panetta first. Way before you
get to being a Democrat.
And I have to say as a new Member, I am encouraged with my
cohorts who came to not just move the deck chairs around, but
to fundamentally change the game up here for the American
people.
And so with that, it seems to me that whether you are
trying to do what Senator Perdue articulated as our sort of
first goal and get predictability and certainty in getting a
budget out and funding the government or you are trying to have
budget outcomes that somehow improve the position fiscally of
this country and chip away at the deficit and debt.
Either way, you have to acknowledge, as Chairman Obey
mentioned earlier, that we don't have the political will
collectively. I would like to think I do. I think everybody
would like to raise their hand and say, ``Well, I do.'' But
collectively, we know that we don't. Republicans don't.
Democrats don't.
So can we just start with that assumption, that we don't
have the political will? And then and only then can you really
get at solving both the process issue and the outcome issue. At
least you have an opportunity to.
Now, I think you first have to acknowledge, and I agree
with Chairman Obey, there are structural issues with campaign
finance, gerrymandering, I hate it. We can all kick around
ideas how to change that. I would actually think, because we
haven't fixed gerrymandering, I am a term limit guy, as well.
There are lots of structural reforms to consider that I
think would improve the behavior. I think most States, like the
great State of Texas, work on a balanced budget because they
have a forcing mechanism, the Balanced Budget Amendment to the
Constitution.
Now absent that, we have to come up with what Senator Ernst
suggested in her discussion with you, and that is a forcing
mechanism. It is the only way to do it. Let's just acknowledge
the nature of the beast is what it is.
I am trying to figure out how you can't be so squirrely in
the process that whatever enforcement mechanism you put in
place that you don't have some rule in the 11th hour where
everybody can vote on it, nobody is accountable for it, the
American people don't understand what happens, and we just keep
on going down that path of destruction, sleepwalking, as they
say, off this cliff.
I would go back to her question. And you said something,
and I am hopeful, because you had at least--something resonated
with you in the way of an enforcement. No budget, no pay, no
budget, no recess, I don't know if those will work, I am
willing to try all of them.
But no budget, no spend, no budget, no pass, no
legislation, no spend, that has a fiscal impact. So you think
that that might work. So we have got an issue, an item on the
table for consideration. Would you expound on that?
Mr. Panetta. Well, the way it operated was that in order
for the authorizing committees to move spending legislation, in
order for Appropriations to move their bills, there had to be a
budget.
And what happened was that as the Budget Committee failed
to pass budget resolutions, then they came up with this trigger
mechanism to basically assign levels to the Appropriations
Committee to operate without a budget, and that bypassed the
process.
I think it is important to stick to the basic discipline of
the process, which is pass a budget, and pass it by a certain
date. And if it doesn't pass you are not going to move any
legislation that has some kind of fiscal impact. And, frankly,
appropriations committees ought not to move forward.
Now, I understand the politics, if you are suddenly stuck
and you can't do anything, then you find waivers, you find ways
around it. I mean, that is the way we govern. But it really
does require some degree of discipline. If you are going to
establish any process, you have got to have the ability to try
to stick to that discipline.
And, look, the biggest problem here is none of these
decisions that we are talking about are easy, and there isn't a
process way to make them easy. They are very tough decisions.
And the problem right now is I think most people in this
institution would like to be able to somehow move the process
without pissing off people. It doesn't work that way. You are
going to have to offend people, with the decisions in the
budget, with the decisions on discipline, you are going to have
to do that. People don't like to take political risk.
But I have never seen a leader in this institution--or,
frankly, in the Presidency--I have never seen leader who has
been able to lead and not take risks. And that is what you are
going have to--that is probably the first principle that is
going to have to apply here.
Representative Arrington. Thank you, Mr. Chairman. I yield
back.
Co-Chair Womack. I thank the gentleman.
Thank you, Secretary Panetta, Chairman Obey, for appearing
before us today.
I want to advise members that they can submit written
questions to be answered later in writing. They will be made
part of the formal hearing. Any members wishing to submit
questions or extraneous material may do so within 7 days.
Now, this concludes our fifth public hearing and fulfills
the Bipartisan Budget Act statutory requirement for this select
complete to conduct at least five such hearings by November 30.
While our requirement has been fulfilled, I believe there is
value in exploring topics for additional hearings in the
future.
Looking back, I believe our hearings have been insightful.
With each discussion I have been encouraged by the involvement
and participation of our members and impressed by and grateful
for the advice and testimony brought by the many outside
witnesses, including the 25 of our colleagues who participated
in Members Day.
I am happy to report that bipartisan, bicameral consensus
is steadily growing with our group of 16. In fact, a number of
our members have already submitted their reform ideas for
improving the budget and appropriations process, and I am
encouraging all members to submit any ideas in writing to the
co-chairs.
While the statutory deadline for reporting our
recommendations is the 30th of November, I have said from the
beginning that the work drafting a proposal should begin sooner
rather than later, and that time is now.
With that said, starting this month the co-chair and I will
begin working informal working sessions. All members are
welcome and encouraged to attend. I am hopeful all members
will. The mission of this panel is too important not to
succeed, and your ideas and feedback garnered through our
months of collective work are essential to that goal. So our
staffs will be in touch regarding the pending schedule of these
informal meetings.
Once again to our witnesses this morning, Secretary
Panetta, Chairman Obey, thank you so much for your insightful
testimony here today.
And with that, this hearing stands adjourned.
[Whereupon, at 12:11 a.m., the committee was adjourned.]
Congressional Budget Office Briefing
Materials prepared for the
Joint Select Committee
----------
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
H.R. 7191
----------
115th CONGRESS
2d Session
H. R. 7191
To implement reforms to the budget and appropriations process in the
House of Representatives.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 29, 2018
Mr. Womack (for himself and Mr. Yarmuth) introduced the following bill;
which was referred to the Committee on the Budget, and in addition to
the Committee on Rules, for a period to be subsequently determined by
the Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To implement reforms to the budget and appropriations process in the
House of Representatives.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Bipartisan Budget
and Appropriations Reform Act of 2018''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--BIENNIAL BUDGET RESOLUTIONS
Sec. 101. Purposes.
Sec. 102. Definitions.
Sec. 103. Revision of timetable.
Sec. 104. Biennial concurrent resolutions on the budget.
Sec. 105. Committee allocations.
Sec. 106. Revision of biennial budget.
Sec. 107. Additional amendments to the Congressional Budget Act of 1974
to effectuate biennial budgeting.
Sec. 108. Reconciliation process.
Sec. 109. Amendments to the Rules of the House of Representatives to
effectuate biennial budgeting.
Sec. 110. Membership of the Committee on the Budget.
Sec. 111. Rulemaking authority.
Sec. 112. Effective date.
TITLE II--OTHER MATTERS
Sec. 201. Views and estimates of committees.
Sec. 202. Annual supplemental budget submission by the President.
Sec. 203. Hearing on the fiscal state of the Nation.
TITLE I--BIENNIAL BUDGET RESOLUTIONS
SEC. 101. PURPOSES.
Paragraph (2) of section 2 of the Congressional Budget and
Impoundment Control Act of 1974 is amended to read as follows:
``(2) to facilitate the determination biennially of the
appropriate level of Federal revenues and expenditures by the
Congress;''.
SEC. 102. DEFINITIONS.
Section 3 of the Congressional Budget and Impoundment Control Act
of 1974 (2 U.S.C. 622) is amended--
(1) in paragraph (4), by striking ``for a fiscal year''
each place it appears and inserting ``for a biennium''; and
(2) by adding at the end the following new paragraphs:
``(12) The term `direct spending' has the meaning given to
such term in section 250(c)(8) of the Balanced Budget and
Emergency Deficit Control Act of 1985.
``(13) The term `biennium' means any period of 2
consecutive fiscal years beginning with an even-numbered fiscal
year.
``(14) The term `budget year' has the meaning given that
term in section 250(c)(12) of the Balanced Budget and Emergency
Control Act of 1985.''.
SEC. 103. REVISION OF TIMETABLE.
Section 300 of the Congressional Budget Act of 1974 (2 U.S.C. 631)
is amended to read as follows:
``timetable
``Sec. 300. The timetable with respect to the congressional budget
process for any Congress is as follows:
``First Session
On or before: Action to be completed:
First Monday in February................ President submits budget.
February 15............................. Congressional Budget Office submits report to Budget Committees.
March 1................................ Committees submit views and estimates to Budget Committees.
April 1................................. Senate Budget Committee reports biennial budget.
May 1................................... Congress completes action on the biennial budget.
May 15.................................. Appropriation bills may be considered in the House of Representatives.
June 10................................. House Appropriations Committee reports last annual appropriation bill.
October 1............................... First fiscal year of the biennium begins.
``Second Session
On or before: Action to be completed:
First Monday in February................ President submits budget.
February 15............................. Congressional Budget Office submits report to Budget Committees.
June 10................................. House Appropriations Committee reports last annual appropriation bill.
October 1............................... Second fiscal year of the biennium begins.''.
SEC. 104. BIENNIAL CONCURRENT RESOLUTIONS ON THE BUDGET.
(a) Contents of Resolution.--
(1) In general.--Section 301(a) of the Congressional Budget
Act of 1974 (2 U.S.C. 632(a)) is amended--
(A) by striking ``On or before April 15'' and all
that follows through ``the following:'' and inserting
the following: ``On or before May 1 of each odd-
numbered calendar year, the Congress shall complete
action on a concurrent resolution on the budget for the
biennium beginning on October 1 of that calendar year.
The concurrent resolution shall set forth appropriate
levels for each fiscal year in the biennium and for at
least each fiscal year in the next 2 bienniums for the
following--'';
(B) in paragraph (6)--
(i) by striking ``for the fiscal year'' and
inserting ``for each fiscal year in the
biennium''; and
(ii) by striking ``and'' at the end;
(C) in paragraph (7)--
(i) by striking ``for the fiscal year'' and
inserting ``for each fiscal year in the
biennium''; and
(ii) by striking the period at the end and
inserting ``; and'';
(D) by adding after paragraph (7) the following:
``(8) subtotals of new budget authority and outlays for
nondefense discretionary spending; defense discretionary
spending; direct spending; and net interest.''; and
(E) by adding at the end of the matter following
paragraph (8) (as added by subparagraph (D)) the
following: ``The concurrent resolution on the budget
for a biennium shall include procedures for adjusting
spending and revenue levels, committee allocations, and
other amounts in the resolution during the second
session of a Congress to reflect an updated baseline
that will be used for scoring purposes.''.
(b) Additional Matters in Concurrent Resolution.--Section 301(b) of
the Congressional Budget Act of 1974 (2 U.S.C. 632(b)) is amended--
(1) in paragraph (3), by striking ``for such fiscal year''
and inserting ``for either fiscal year in such biennium'';
(2) in paragraph (8), by striking ``and'' at the end;
(3) in paragraph (9), by striking the period at the end and
inserting ``; and''; and
(4) by adding at the end the following:
``(10) include total combined outlays and revenues for tax
expenditures.''.
(c) Hearings and Report.--Section 301(e)(1) of the Congressional
Budget Act of 1974 (2 U.S.C. 632(e)) is amended by striking ``fiscal
year'' and inserting ``biennium''.
(d) Goals for Reducing Unemployment.--Section 301(f) of the
Congressional Budget Act of 1974 (2 U.S.C. 632(f)) is amended by
striking ``fiscal year'' each place it appears and inserting
``biennium''.
(e) Economic Assumptions.--Section 301(g)(1) of the Congressional
Budget Act of 1974 (2 U.S.C. 632(g)(1)) is amended by striking ``for a
fiscal year'' and inserting ``for a biennium''.
(f) Section Heading.--The section heading of section 301 of the
Congressional Budget Act of 1974 (2 U.S.C. 632) is amended by striking
``annual adoption of'' and inserting ``adoption of biennial''.
SEC. 105. COMMITTEE ALLOCATIONS.
Section 302 of the Congressional Budget Act of 1974 (2 U.S.C. 633)
is amended--
(1) in subsection (a)(1)--
(A) by striking ``for that period of fiscal years''
and inserting ``for all fiscal years covered by the
resolution''; and
(B) by striking ``only for the fiscal year of that
resolution'' and inserting ``only for each fiscal year
of the biennium'';
(2) in subsection (c)--
(A) by striking ``subsection (a)'' and inserting
``subsection (a)(1)'';
(B) by striking ``for a fiscal year'' and inserting
``for a budget year''; and
(C) by striking ``for that fiscal year'' and
inserting ``for that budget year'';
(3) in subsection (f)(1)--
(A) by striking ``for a fiscal year''; and
(B) by striking ``the first fiscal year'' and
inserting ``either fiscal year of the biennium of that
resolution''; and
(4) in subsection (f)(2)(A), by--
(A) striking ``the first fiscal year'' and
inserting ``either fiscal year of the biennium of that
resolution''; and
(B) striking ``the total of fiscal years'' and
inserting ``the total of all fiscal years covered by
the resolution''.
SEC. 106. REVISION OF BIENNIAL BUDGET.
Section 304 of the Congressional Budget Act of 1974 (2 U.S.C. 635)
is amended to read as follows:
``permissible revisions of concurrent resolutions on the budget
``Sec. 304. At any time after the concurrent resolution on the
budget has been agreed to pursuant to section 301 and before the end of
the biennium, the two Houses may adopt a concurrent resolution that
revises or reaffirms the most recently agreed to concurrent resolution
on the budget. Any concurrent resolution that revises or reaffirms the
most recently agreed to concurrent resolution on the budget shall be
considered under the procedures set forth in section 305.''.
SEC. 107. ADDITIONAL AMENDMENTS TO THE CONGRESSIONAL BUDGET ACT OF 1974
TO EFFECTUATE BIENNIAL BUDGETING.
(a) Enforcement of Section 303.--Section 303 of the Congressional
Budget Act of 1974 (2 U.S.C. 634) is amended--
(1) in subsection (a)--
(A) by striking ``for a fiscal year'' and inserting
``for a biennium''; and
(B) by striking ``the first fiscal year covered by
that resolution'' and inserting ``either fiscal year of
that biennium'';
(2) in subsection (b)(1)(B), by striking ``the fiscal
year'' and inserting ``the biennium''; and
(3) in subsection (c)--
(A) in paragraph (1)--
(i) by striking ``for a fiscal year'' and
inserting ``for a biennium''; and
(ii) by striking ``for that year'' each
place it appears and inserting ``for each year
of that biennium''; and
(B) in paragraph (2), by striking ``after the year
the allocation referred to in that paragraph is made''
and inserting ``after the years the allocations
referred to in that paragraph are made''.
(b) Section 305.--Subsections (a)(3) and (b)(3) of section 305 of
the Congressional Budget Act of 1974 (2 U.S.C. 636) are amended by
striking ``for a fiscal year''.
(c) Section 311 Point of Order.--
(1) In the house of representatives.--Section 311(a)(1) of
the Congressional Budget Act of 1974 (2 U.S.C. 642(a)) is
amended--
(A) by striking ``for a fiscal year'';
(B) by striking ``the first fiscal year'' each
place it appears and inserting ``either of the first
two fiscal years covered by such resolution''; and
(C) by striking ``that first fiscal year'' and
inserting ``either of the first two fiscal years''.
(2) In the senate.--Section 311(a)(2) of the Congressional
Budget Act of 1974 (2 U.S.C. 642(a)(2)) is amended--
(A) in subparagraph (A), by striking ``for the
first fiscal year'' and inserting ``for either of the
first two fiscal years''; and
(B) in subparagraph (B)--
(i) by striking ``that first fiscal year''
the first place it appears and inserting
``either of the first two fiscal years''; and
(ii) by striking ``that first fiscal year
and the ensuing fiscal years'' and inserting
``all fiscal years''.
(3) Social security levels.--Section 311(a)(3) of the
Congressional Budget Act of 1974 (2 U.S.C. 642(a)(2)) is
amended by--
(A) striking ``for the first fiscal year'' and
inserting ``for either of the first two fiscal years'';
and
(B) striking ``that fiscal year and the ensuing
fiscal years'' and inserting ``all fiscal years''.
SEC. 108. RECONCILIATION PROCESS.
Section 310(a) of the Congressional Budget Act of 1974 (2 U.S.C.
641(a)) is amended--
(1) in the matter before paragraph (1), by striking ``A
concurrent'' and all that follows through ``shall'' and
inserting ``A concurrent resolution on the budget for a
biennium shall, for each fiscal year of the biennium'';
(2) in paragraph (1)(A), by striking ``for such fiscal
year'' and inserting ``for each fiscal year of the biennium'';
(3) in paragraph (1)(C), by striking ``such fiscal year''
and inserting ``each fiscal year of the biennium''; and
(4) in paragraph (1)(D), by striking ``such fiscal year''
and inserting ``each fiscal year of the biennium''.
SEC. 109. AMENDMENTS TO THE RULES OF THE HOUSE OF REPRESENTATIVES TO
EFFECTUATE BIENNIAL BUDGETING.
(a) Clause 4(a)(4) of rule X of the Rules of the House of
Representatives is amended by striking ``any allocations'' and
inserting ``its allocations for the budget year'' and by striking
``fiscal year'' and inserting ``biennium''.
(b) Clause 4(b)(2) of rule X of the Rules of the House of
Representatives is amended by striking ``for each fiscal year''.
(c) Clause 4(b) of rule X is amended by striking ``and'' at the end
of subparagraph (5), by striking the period and inserting ``; and'' at
the end of subparagraph (6), and by adding at the end the following new
subparagraph:
``(7) use the second session of each Congress to study
issues with long-term budgetary and economic implications.''.
(d) Clause 4(f) of rule X is amended--
(1) by striking ``fiscal year'' the first place it appears
and inserting ``biennium'';
(2) by striking ``that fiscal year'' and inserting ``each
fiscal year in such ensuing biennium''; and
(3) in subparagraph (1) by striking ``six weeks after the
submission of the budget by the President'' and inserting
``March 1''.
(e) Clause 3(d)(1)(A) of rule XIII is amended by striking ``five''
both places it appears and inserting ``six''.
SEC. 110. MEMBERSHIP OF THE COMMITTEE ON THE BUDGET.
(a) Clause 5(a)(2) of rule X of the Rules of the House of
Representatives is amended--
(1) by striking subdivisions (B) and (C); and
(2) in subdivision (A), by striking ``(A)'' and by
redesignating items (i), (ii), and (iii) as subdivisions (A),
(B), and (C), respectively.
(b) The amendment made by subsection (a) shall take effect
immediately before noon, January 3, 2019.
SEC. 111. RULEMAKING AUTHORITY.
Sections 109 and 110 are enacted by the Congress--
(1) as an exercise of the rulemaking power of the House of
Representatives, and as such they shall be considered as part
of the rules of the House and such rules shall supersede other
rules only to the extent that they are inconsistent therewith;
and
(2) with full recognition of the constitutional right of
the House to change such rules at any time, in the same manner,
and to the same extent as in the case of any other rule of the
House.
SEC. 112. EFFECTIVE DATE.
This title and the amendments made by this title shall take effect
immediately before noon January 3, 2019.
TITLE II--OTHER MATTERS
SEC. 201. VIEWS AND ESTIMATES OF COMMITTEES.
Section 301(d) of the Congressional Budget and Impoundment Control
Act of 1974 (2 U.S.C. 632(d)) is amended to read as follows:
``(d) Views and Estimates of Other Committees.--
``(1) In general.--Not later than March 1 of the first
session of a Congress, or upon the request of the Committee on
the Budget of the House of Representatives or the Senate, each
committee of the House of Representatives and the Senate having
legislative jurisdiction shall submit to its respective
Committee on the Budget its views and estimates (as determined
by the committee making such submission) with respect to the
following:
``(A) Any legislation to be considered during that
Congress that is a priority for the committee.
``(B) Any legislation within the jurisdiction of
the committee that would establish, amend, or
reauthorize any Federal program and likely have a
significant budgetary impact.
``(2) Additional matters.--Any committee of the House of
Representatives or the Senate and any joint committee of the
Congress may submit to the appropriate Committees on the Budget
its views and estimates with respect to all matters set forth
in subsections (a) and (b) which relate to matters within its
jurisdiction.
``(3) Joint economic committee.--The Joint Economic
Committee shall submit to the Committees on the Budget of both
Houses its recommendations as to the fiscal policy appropriate
to the goals of the Employment Act of 1946.''.
SEC. 202. ANNUAL SUPPLEMENTAL BUDGET SUBMISSION BY THE PRESIDENT.
Section 1106 of title 31, United States Code, is amended by adding
at the end the following:
``(d) On or before December 1 of each calendar year, the President
shall submit to Congress an administrative budget for the fiscal year
beginning in the ensuing calendar year, which shall include up-to-date
estimates for current year and prior year data and credit reestimates
for the current year (as included in the Federal credit supplement of
such budget).''.
SEC. 203. HEARING ON THE FISCAL STATE OF THE NATION.
(a) In General.--Not later than 45 days (excluding Saturdays,
Sundays, and holidays) after the date on which the Secretary of the
Treasury submits to Congress the audited financial statement required
under paragraph (1) of section 331(e) of title 31, United States Code,
on a date agreed upon by the chairs of the Committees on the Budget of
the House of Representatives and the Senate and the Comptroller General
of the United States, the chairs shall conduct a hearing to receive a
presentation from the Comptroller General reviewing the findings of the
audit required under paragraph (2) of such section and providing, with
respect to the information included by the Secretary in the report
accompanying such audited financial statement, an analysis of the
financial position and condition of the Federal Government, including
financial measures (such as the net operating cost, income, budget
deficits, or budget surpluses) and sustainability measures (such as the
long-term fiscal projection or social insurance projection) described
in such report.
(b) Effective Date.--The requirement under subsection (a) shall
apply with respect to any audited financial statement submitted on or
after the date of the enactment of this Act.
Press Release Accompanying the
Introduction of H.R. 7191
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