Former Mississippi Senator Trent Lott, describing his job as leader of the Senate Republicans labeled the task as “herding cats” and now that role falls on our own senior Kentucky Senator Mitch McConnell.
There will be a lot of tests for Senator McConnell as he herds the Republicans through issues ranging from increasing the debt ceiling to funding the Highway Trust Fund. His most immediate problem is funding the Department of Homeland Security where the funding authority expires on February 27. The House passed a version of the DHS funding bill that reversed President Obama’s executive orders on immigration, including the one to stop deportation for undocumented aliens who were brought to the U.S. as children, so-called Dreamers. However with the delivery the Obama budget for fiscal year 2016 the Congress has started what will be one of the critical debates of the year.
The challenge for Senator McConnell and his leadership team is for the new Republican Congress to pass a budget that the President can sign but not alienate the Tea Party base of the party. Big decisions on spending priorities for education, housing, infrastructure, regulation, and defense all will be part of the budget debate.
The rise of the Tea Party wing of the Republican Party has created a new dynamic that makes life much more difficult for the party’s Congressional leadership and the White House. With gerrymandering becoming an exact science most sitting members of the House have little concern about defeat in the general election, but now focus on their primary election. In 2014 many incumbent Republican Senators running for re-election faced a Tea Party primary opponent. Two Senators, Thad Cochran of Mississippi and Pat Roberts of Kansas, almost got defeated in their primaries. In all the races the incumbents were challenged on issues ranging from voting to increase of the debt ceiling to being big spenders. Incumbent Republicans learned from these races and will work hard to make sure no potential rival gets to the political right of them on fiscal issues. In this environment it will be hard to get anything close to the President’s budget through the House.
The dilemma of reduced spending caps
Perhaps nothing reflects the challenge of the upcoming budget battle as the dilemma of what to do about the reduced spending caps imposed by the sequestration law approved in 2011. While sequestration occurred in 2013, in budget years 2014 and 2015, Congress reversed some of the impact in the Ryan/Murray budget compromise. In his budget for FY 2016 the President recommended over $74 billion in new funding to reverse the sequester cuts. The President’s budget divides the added money about equally between defense and domestic spending. While the President’s budget reduces the deficit over 10 years it never balances the budget. Republicans, especially House Republicans, are committed to approving a 10-year balanced budget. Budget cuts at the sequester level are likely to be required in order to reach a balanced budget.
The combination of the sequester cuts, and the President’s budget to reverse the cuts, raises serious policy issues between Republicans defense hawks and Republican deficit hawks. Led by Senator John McCain, the new chair of the Senate Armed Services Committee, a group of Republicans believe that it is essential to reverse the sequester cuts for the Pentagon. However, while applauding the President’s increased defense spending they have problems with the increased domestic spending and the President’s proposed tax increases.
On the other hand Republican budget hawks, joined by many liberal Democrats, believe that the U.S. carries an unfair burden for defending the world, and that our allies should step up with greater spending. According to a study conducted by Peace Research Institute the U.S. spends more on defense than the next ten nations with the largest national defense budgets. While Republicans know that they must take action on entitlement spending to get control of the budget, many also acknowledge that defense can’t be exempt from spending restraint. Furthermore, both the President and Congressional Democrats, have made clear that they won’t approve a sequestration exemption for defense that does not also exempt domestic programs.
When the House passed the Ryan/Murray budget agreement at the end of 2013 the vote in the House was 331 to 94; but 62 Republicans voted NO as they opposed the increased spending. As the Tea Party threat in Republican House primaries has continued to grow it could be a challenge to get a majority for any package that is viewed as a compromise with the President that increases domestic funding as the Ryan/Murray agreement did. Even with the ten-seat pickup, Republicans can only lose 28 votes without seeking Democratic support, showing the strength that the conservative House Republicans will wield in the budget debate.
The debate over this year’s budget may have big implications for U.S, government spending priorities for years to come.
Tom Block is a public policy consultant who had a 21-year career with JP Morgan Chase where he served as head of government relations in New York City and created a Washington research product. He also created the bank’s EU Government Relations program and developed a new position as U.S. government policy strategist focusing on how U.S. government policy impacts capital markets. He has an extensive government and banking background, has worked on political campaigns and as a speech writer. He is a family trustee of Bernheim Aboretum in Louisville and holds a bachelor’s degree in political science from American University. He and his wife make their home in Kentucky. Contact him at tomblockct@aol.com.