By law, every year by the middle of the year, the administration has to provide an update of the president’s proposed budget for the coming fiscal year. This midsession review — technically due July 16, by the way — gives the president the chance to reexamine and revise his budget one last time before Congress finalizes appropriations.
Ordinarily, the release of the review is a ho-hum affair, confirming that the president stands by the budget he submitted in the spring or indicating slight changes to the president’s plan. But, this year, at least three important budget-related developments have occurred since February, when the president released his original (failed) budget (a 97-to-nothing defeat in the Senate!).
In the first place, the president released a different “budget framework” in April (i.e. he made a speech), in which he called for $4 trillion in deficit reduction. Secondly, Congress imposed spending caps as a part of the debt ceiling deal — caps that were not a part of the president’s original proposed budget. And finally, the president has repeatedly called for increased infrastructure spending.
The administration has obviously already missed the July 16 deadline, but the White House has said the midsession review will come out sometime this week (likely as near to Labor Day as possible, to ensure it slides under the radar). How will the president reconcile all of his mixed messages into one coherent vision for the federal budget? The release of the review will be an important indicator of whether the president’s April “budget framework” speech was sincere — or just empty rhetoric.
What to look for and what it will mean:
- How many revisions does it contain? Few revisions will signal that the president stands by his original failed budget — a budget that blatantly increased the debt and deficit.
- Does it put forward a plan that Congress can actually act on? If it reiterates the president’s call for $4 trillion in deficit reduction over 10 years, but doesn’t specify a way to get there, it’s a repeat of the president’s game plan thus far, which has been, “Talk tough, but provide no real leadership.” Keep in mind that the Budget Control Act (i.e. the debt ceiling deal) provides for just $2 trillion in deficit reduction over the next 10 years (and that includes the still-ahead work of the Super Committee). If the president is serious about his $4 trillion figure, his review should reflect his ideas for an additional $2 trillion in deficit reduction.
- Does it offset the increases in spending that the Democrat base has been clamoring for and that the president looks prepared to propose as a part of his jobs plan? The president can’t have it both ways — purporting to cut the deficit with his proposed budget while simultaneously proposing to increase spending to create jobs. His cuts will have to be even deeper than an additional $2 trillion if he wants to increase infrastructure spending, extend the payroll tax cut, etc.
Obviously, it’s wishful thinking to suggest the president might actually put forward a concrete plan for additional deficit reduction in this midyear review. It seems safe to say the president’s April budget speech was empty rhetoric, aimed to pacify cut-craving Republicans in advance of the debt ceiling debate. But it’s more important now than ever, as Congress enters the appropriations season, to remind GOP leadership that the president himself once called for $4 trillion in deficit reduction — twice as much as was achieved with the debt ceiling deal — because some rumblings suggest top Republicans are budget-weary and unwilling to fight for deeper cuts during the upcoming funding round.