Follow the Money...or What Federal Budget Proposals Say about Our Priorities

March 18, 2013

By Elizabeth Lower-Basch

Last week, Senate Democrats and House Republicans moved forward on budget resolutions that offer visions of the role of the federal government and our nations’ priorities.  Both set targets for federal spending and revenues in fiscal years 2014 and beyond, but they would move the nation in dramatically different directions. 

The Senate Budget Resolution, Senator Patty Murray’s Foundation for Growth, sees an important role for the federal government in promoting job creation, economic growth, and middle class prosperity.  It would replace the across-the-board cuts of sequestration, and provide for additional deficit reduction, through a balance of spending cuts (both military and domestic) and modest new revenues through closing tax loopholes.  It also calls for $100 billion in investments in jobs and infrastructure, with $10 billion reserved for worker training activities focused on youth and long-term unemployed workers.   It would protect programs that are critical to low- and moderate-income families, including child care programs and college financial aid.

The House Budget Resolution, Representative Paul Ryan’s Pathway to Prosperity, sets deficit reduction and lowering tax rates as the absolute priorities.  In order to achieve these goals, it would cut domestic discretionary spending even lower than under sequestration, while allowing military spending to return to pre-sequestration levels.  The House Budget Resolution would turn Medicaid and SNAP into block grants, cutting federal support and crippling these key programs’ ability to respond to the next recession.   It claims that tax changes would not increase the deficit, which implies that nearly all tax preferences, including those that benefit middle class families, would need to be eliminated.

While these proposals differ in nearly all respects, it is worth noting that they both would reduce tax preferences and expenditures.   The Senate bill would use these cuts for deficit reduction, while the House bill would use them all to reduce tax rates for the highest income households.  As a consequence, the spending cuts in the Ryan budget are many times deeper than in the Murray proposal.  A third proposal, from the House Congressional Progressive Caucus, would both raise rates and reduce tax preferences, using the revenues to support additional investments in job creation.

Murray and Ryan’s budget resolutions are likely to be passed by their respective chambers this week. Neither bill has a chance of getting through the opposite chamber — but they serve as opening moves for the next stage of the ongoing budget drama.  Next month, President Obama will present his budget, which will show his spending priorities, as well as more detailed program-level information. 

The fiscal cliff, sequestration — every week provides a new deadline, a new chance for talking heads to argue about who is winning the budget battles.  But beyond the daily news cycle, budgets are how we answer important questions: what do we want our government do, and how shall we pay for it?  If we give up in disgust at the constant stream of manufactured crises, and stop paying attention, we give up our seat at the table when these decisions are made.   So we need to tell our representatives what our vision for America is and make sure our voice is heard.

 

 

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