The 2012 Budget Dynamic

Three important numbers stand out in the pending budget imbroglio that’s about to start in Washington:




Parenthetical “t’s” follow the first two figures, as in trillion. The second one requires a “b” as in billion for a suffix.

This trifecta of numbers could dictate where the Republican party is on spending, telegraph their political fortunes, reveal the standing of the tea party in the 2012 elections and gauge whether the nation is again running headlong into a potential government shutdown this fall – slightly more than a month before election day.

Some of this will begin to shake out on Friday afternoon as House Republican members on the Budget Committee join a conference call to discuss what could be the final number the GOP aims to hit with this year’s budget blueprint.

Last August, Congressional Democrats, Republicans and President Obama forged the Budget Control Act. The package hiked the debt ceiling. But it also set in motion a decade of spending caps designed to curb the budgets of cabinet departments and federal agencies. As a result, fiscal year 2013 (which starts October 1) sets an across the board spending ceiling of $1.047 trillion.

But many conservatives and lawmakers with tea party loyalties argue that figure is still too high. Some on the right don’t think Republicans did enough to prune federal spending last year. With primaries approaching and the 2012 election less than eight months away, Republicans want to capture a few fiscal scalps in the form of deeper spending cuts.

Some GOPers advocate that Congress slash the spending levels below $1.047 trillion. Some of the most-conservative voices on Capitol Hill believe it’s important to curb spending below the psychologically important $1 trillion bar and are pushing for a figure of $931 billion.

“There is a lot of pent-up demand from our Members to show the American people a way forward to fiscal sanity. We can’t continue to have budget deficits of over a trillion dollars a year,” said House Speaker John Boehner (R-OH) recently.

President Obama and Congressional Democrats will cry foul if Republicans vacate the $1.047 trillion spending cap called for in last year’s budget accord. But in an interview with Fox Business Network’s Rich Edson, Boehner signaled a willingness to abate the $1.047 trillion threshold.

“We can certainly do more,” Boehner said, suggesting that $1.047 trillion is a limit. A key Republican leadership aide asserts that the definition of a “cap” is simply a number which can’t be exceeded, not a figure which must be met.

But here’s the rub:

Republicans expect Democrats to howl about dropping the $1.047 trillion spending cap. That’s smart politics for the GOP as they can portray the Democrats as pushing for “higher” spending. But roasting the Democrats is partly a sleight-of-hand. Republicans are trying to obviate their own internal squabbles about what spending figure they should actually use.

$1.028 trillion appears to be the figure many leading GOPers are shopping around.

However, $1.028 trillion might still be pricey for many Republicans on the House Budget Committee. And it all depends what some of the cuts are, to say nothing of how they handle the defense sequester. The defense sequester is the Congressional mandate that lawmakers significantly chop the Pentagon’s budget due to the failure of last fall’s supercommittee.

Rep. Scott Garrett (R-NJ) is the second-ranking Republican on the Budget panel and one of the most-conservative members in the House. He’d prefer a number below a trillion dollars in spending. Others, like freshmen Reps. Reid Ribble (R-WI), Mick Mulvaney (R-SC) and Tim Huelskamp (R-KS) are advocating the lowest figure possible, too.

Some wonder if Budget Committee members affiliated with the tea party could balk next week when the panel goes to craft the final budget blueprint. That could create a problem for the House GOP braintrust if they struggle to report a budget out of committee. And that’s to say nothing about prospects of passing a budget on the House floor.

When the full House considers the budget, it’s typical to bar most garden variety amendments. However, the budget process usually permits what are called “substitute” amendments. Those substitutes amount to fully-formed “alternative” budget proposals.

For instance, the “base” budget produced by the Budget Committee is likely to be named after Committee Chairman Paul Ryan (R-WI) and will be known as  the “Ryan Budget.” Then, the House is expected to make in order a number of “substitute” budgets. Rep. Chris Van Hollen (D-MD), the top Democrat on the Budget Committee, would probably offer the Democrats’ flagship. Coalitions such as the Congressional Black Caucus, Congressional Hispanic Caucus and even individual members like Rep. Jim Cooper (D-TN) could introduce their own budget designs as well.

And then, there’s the Republican Study Committee (RSC), the most-conservative bloc of GOP members in the House.

No budget has ever matched the hype surrounding the release of the Ryan Budget last year. Last year’s RSC construct proposed much deeper cuts than were drawn-up by Paul Ryan and came close to passing due to some parliamentary artistry executed by House Democrats.

It’s undetermined if the RSC will offer an alternative budget this year. But the $1.047 trillion plan is anathema to many RSC members. They would prefer to see a budget sketch which comes in well bellow the trillion dollar figure.

This creates consternation on the House floor for the GOP leadership. The House always considers the base resolution last (in this case, the Ryan plan) after dispensing with all of the “substitute” budgets. But if the House approves any of the substitute proposals beforehand, the process stops dead its track. The substitute proposal which wins becomes the governing document.

It’s entirely possible that House Republicans could demand a lower figure offered by the RSC and reject any budget above a trillion dollars. If that’s the case, one wonders if the House could adopt a “substitute” plan offered by the RSC, thus short-circuiting any consideration of the Ryan budget.

That scenario could trigger a donnybrook for the GOP. Approving a lean budget that requires serious fiscal cleaving looks good to conservatives. But it’s unlikely that the Democratically-controlled Senate would ever go along with a budget so svelte. Such a budget could hinder Congressional appropriators from approving the annual spending bills which fund individual federal departments. Moreover, President Obama would veto those bills, even if they did pass Congress. Plus, House Appropriations Committee Chairman Hal Rogers (R-KY) prefers the $1.047 trillion figure. Rogers has appropriator allies on the Budget Committee to back him up. Some believe infighting over the size of the budget could create the possibility of a government shutdown with the election fast approaching. No one wants to roll those dice that close to November because it’s unclear who the public might blame.

“I’m really disappointed that they’re considering a budget — violating the budget agreement that is now the law of this country. This was designed to avoid another government shutdown or a threat of a shutdown,” charged Senate Majority Leader Harry Reid (D-NV). “This wasn’t only a handshake, a pat on the back; it was a law we passed.”

But there’s another gloomy situation brewing for the GOP, too.

House Republicans are fractured over the three major spending figures. It’s entirely possible that leadership may not be able to convince its members to coalesce around a single number. If that happens, the GOP would have trouble bringing a budget to the floor at all since it wouldn’t have the votes to pass.

On Thursday evening, the House Budget Committee released a video that shows Paul Ryan walking alone down an empty corridor in the Cannon House Office Building after the close of business. A harmonic of soft strings and piano serve as the video’s soundtrack as Ryan stares squarely into the camera to argue for his pending budget plan.

“This is why we’re acting. This is why we’re leading. This is why we’re proposing and passing in the House a budget to fix this problem. So we can save our country,” Ryan says.

At first blush, it appears Ryan is speaking to Democratic opponents who don’t think much of his budget ideas. But Ryan’s audience also appears to be wary House Republicans.

And then there’s the GOP’s political rhetoric.

For the past 15 months, House Republicans have browbeaten Harry Reid for failing to pass a budget.

“I find it stunning that the Senate has yet to pass a budget for more than 1,000 days,” excoriated Rep. Jason Chaffetz (R-UT) at a hearing last month.

“It makes it very difficult to return to regular order when we pass the budget on our side, but are not able to get the Senate to function properly under regular order,” complained House Armed Services Committee Chairman Buck McKeon (R-CA) in January.

“2009 was the last time the Senate passed a budget. So, you know, for a thousand days, the Senate has taken their hands off the steering wheel,” lamented Rep. Rich Nugent (R-FL).

So House Republicans repeatedly bleat at the Senate for not approving a budget. They insist they will approve one this year. But it’s going to be a tough vote. It’s challenging to agree on a final number. If Republicans fail, Democrats could enjoy a healthy dose of schadenfreude at the expense of their conservative colleagues.

But in the end, budget resolutions aren’t binding. Under the current system, the only things that matter are appropriations. That’s why the $1.047 trillion benchmark is so controversial. The GOP wants to eliminate spending. One of the best options is to trim that figure. And if House Republicans do, some fiscal observers believe that could set the stage for yet another stalemate over a possible government shutdown in the shadow of the 2012 elections.