Budget Battles

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Congress is in recess this week, in fact through May 1. But the battle lines have now been drawn over the fiscal 2012 budget as House Representatives prepare to resume the debate, with both sides of the aisle vowing to restore fiscal sanity to the nation while presenting widely divergent solutions.

It’s early days, but from the initial skirmishes last week it looks as though the defense budget will escape with relatively minor cuts, with most Democrats and mainstream Republicans recognizing national security as a priority. The Republican budget plan set forth by House Budget Committee Chairman Paul Ryan of Wisconsin notably “assumes full funding for the modernization of the infrastructure that builds and maintains the nation’s nuclear weapons systems.” The Obama Administration pledged a total $85 billion to the weapons labs over the next 10 years for this purpose, as part of the maneuvers to obtain Senate ratification of New START.


The Republican budget framework calls for overall cuts of $5 trillion dollars over a decade. In proposing counter-measures last week, President Obama offered $4 trillion over 12 years, including a reduction in security spending by $400bn. But as BASIC board member Bill Hartung pointed out in a letter to The New York Times on Friday, the security cuts would include not only the Pentagon but also the Department of Homeland Security, the Dept. of Veterans Affairs, the State Department’s military aid programs and the Dept. of Energy’s nuclear weapons complex. Hartung said that with defense spending at its highest levels since World War II, the Pentagon cuts implied in the President’s budget plan are “too little, too late.” Congress on Thursday cut the core Pentagon budget to $530 bn, down by $10 bn from the figure Defense Secretary Robert Gates said was critical when the administration presented its 2012 spending plan, which set $553 bn as the core figure.


The budget framework for 2012, which is the first step of the appropriations process, was adopted by the House on Friday by 235 votes to 193. There was not a single Democratic vote in favor, as House Minority Leader Nancy Pelosi predicted during the debate which focused on taxation issues and proposed Republican changes to the Medicare and Medicaid regimes. (The budget then went to the Democratic-controlled Senate, where it was dead on arrival.)


Last year, Congress failed to adopt such a budget resolution, forcing a series of Continuing Resolutions to fund the government. The final one for fiscal 2011 was voted last Thursday, endorsing a $40 billion plan to cut spending that averted a government shutdown only an hour before it would have come into effect. That vote went through by 260 votes to 167, with 108 Democrats voting against and 59 Republicans opposing the motion because the cuts were not deep enough.


The FY 2011 deal, which runs until the end of the fiscal year in September, calls for a 9 percent increase ($190 million) in funding for nuclear non-proliferation. The Obama Administration has pledged to secure bomb-grade material within four years as part of its nuclear security program which had been under threat from the Republican axe in Congress. Influential House Republicans, such as Michael Turner of Ohio, the chairman of the House Armed Services Subcommittee on Strategic Forces, has warned that his committee will be vigilant as the debate on FY2012 goes forward, to protect the funding promised for the labs and nuclear weapons’ life extension program.


The most urgent decision by House Representatives on their return to work next month will be on raising the debt ceiling – another area in which partisan politics will expose the United States to dire financial risks unless Republicans agree to raise its limit of $14.3 trillion. The debt is expected to break through the ceiling in mid-May.
 

Last week provided more insights into how the new Congress will work. “Welcome to divided government”, was how House Speaker John Boehner put it after Thursday’s vote.
 

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