Budget battle: All quiet on the fiscal front?

It’s gotten pretty quiet in Washington about the budget showdown … perhaps a little too quiet. The deadline for passing the remainder of the FY2018 budget, or at least another continuing resolution, is just a fortnight away on January 19th. The budget fight sits at the center of a number of disputes which have made headlines for months, especially the resolution of DACA and the CHIP health insurance program for children. With Congress back in session, one would normally expect loud demands and threats from both sides of the aisle and both ends of Pennsylvania Avenue.

And yet, there have been nearly no developments reported since the initial 2018 meeting on Wednesday:

Congressional leadership and White House officials were unable to strike a spending deal Wednesday after their first meeting on the topic of 2018.

Speaker Paul D. Ryan hosted the meeting in his Capitol office with Senate Majority Leader Mitch McConnell, Senate Minority Leader Charles E. Schumer, House Minority Leader Nancy Pelosi, Office of Management and Budget Director Mick Mulvaney and White House Legislative Affairs Director Marc Short.

Democrats headed into the meeting pushing for equal increases in defense and nondefense spending, while Republicans continued to pan that approach. The pressure is on, because the 2011 Budget Control Act calls for sequestration, or across-the-board cuts, absent a deal to change that. The sequestration caps for fiscal 2018 are $549 billion for defense and $516 billion for nondefense.

Other than a exchange of sharp words on the Senate floor the same day, nothing much has changed … or happened at all, at least publicly. The main obstacle to a full budget deal is the tension between Democrats’ DACA demands and Trump’s insistence on getting funding for the border wall:

White House press secretary Sarah Huckabee Sanders said Wednesday the White House was open to reaching a DACA deal this month if Democrats agreed to fund construction of a wall along the Mexico border, end a visa-lottery system and terminate a program that allows family-based immigration.

Democrats do not appear willing to do any of those things. Schumer said Democrats would approve more money for “border security” but called construction of a wall “absurdly expensive” and “ineffective.”

Trump has threatened to veto spending bills if they failed to include some funding to begin construction of a border wall.

Not much give there, right? And yet by the end of the day on Wednesday, all sides seemed happy to have gotten together:

Both sides issued bland but positive statements after the session, which lasted more than an hour and included White House budget director Mick Mulvaney.

“We had a positive and productive meeting and all parties have agreed to continue discussing a path forward to quickly resolve all of the issues ahead of us,” said Sen. Chuck Schumer, D-N.Y., and Rep. Nancy Pelosi, D-Calif., in a joint statement.

The White House, Ryan and Senate Majority Leader Mitch McConnell, R-Ky., said in a joint statement of their own that they “hope that further discussions will lead to an agreement soon.” McConnell briefed fellow Republicans afterward and told them the session was “surprisingly good,” according to Sen. John Cornyn, R-Texas.

Sen. Roy Blunt, R-Mo., said, “I don’t think they reached any conclusions, but I think it was a fairly good meeting is what we were told.”

Since then, it’s been radio silence. There aren’t a lot of other issues on the table, at least not legislatively. Michael Wolff’s new book is soaking up lots of attention, as has the blood feud between Steve Bannon, Donald Trump, and the Mercers that Wolff’s book triggered. That looks more like a distraction, and its verrrry curious that all sides seem content to allow that distraction to continue. It certainly would be a propitious time for Pelosi and Schumer to press a political advantage and attack now. So why haven’t they?

Best guess: negotiations have begun to shape an eventual compromise. If so, that would be good news for the GOP and the White House in the longer run. Republicans need to get FY2018 off the table so they can deal with FY2019, where they have a real opportunity to work on their key fiscal priorities, as I argue in my column for The Week:

Republicans will have to learn how to organize themselves better than they did for either the failed ObamaCare repeal or successful tax reform efforts. Despite being long-time promises, Republicans had no apparent plan in place for either prior to opening debate in Congress. Various factions of the party fought with each other in the open rather than working together upfront to settle differences. The fractures allowed Democrats to score public-relations points on the GOP, resulting in having ObamaCare become more popular than ever and tax cuts suddenly becoming a political liability. Much of that damage could have been avoided with a coordinated, organized effort that left the bickering in the cloakroom.

That option may already be moot, thanks to the need to resort to continuing resolutions for FY2018, and a continuation of the status quo for the current budget may be the best Republicans can do. They have a much bigger opportunity for the FY2019 budget, a process that would normally begin in late March or early April. Their best bet for presenting themselves as a responsible governing party before the midterms would be to focus on that budget and to hew closely to the middle-America issues that gave them the White House in 2016.

Conservatives want Congress to restructure entitlements, a long-overdue process, but neither the country nor the opposition are ready for it. Republicans first need to build credibility by demonstrating the ability to handle the annual budget responsibly, especially since Democrats will paint the GOP as heartless for trimming Medicare and Social Security in order to save both from financial collapse. It will take at least one budget cycle before voters will trust Republicans to completely overhaul their retirement programs — and besides, there is no chance at all to get 60 Senate votes in 2018 for entitlement reform.

Gaining credibility as a governing party will take time and patience. Republicans largely squandered both in 2017. They would be wise to make effective governing their New Year’s resolution.

Will Republicans seize that opportunity? Well … hope springs eternal. Let’s just hope they’re preparing for it.