2017 Spending Wraps Up (Dec. 22)

Update 239 — 2017 Spending Wraps Up;

2018 Opens with Shutdown Looming

Yesterday, the House passed a stopgap measure that would fund the government through Jan. 19 The Senate approved the bill immediately afterward.  Just weeks ago, Congress found itself in the familiar position of scrambling to avoid a government shutdown.  It will be again in less than a month.

While the measure provides new funds for only a handful of programs (missile defense and children’s health) the chambers also considered separate legislation addressing entitlement programs and disaster relief yesterday.  There are no indications of a long-term spending bill in the making.

Happy Holidays and New Year everyone!

Back on Jan. 3.




But First, On the Ex-Im Bank

This week, at long last, former Cong. Scott Garrett’s nomination to lead the Export-Import bank, was rejected by Senate Banking. Republican Sens. Rounds and Scott said no to Garrett’s nomination in the Banking Committee, joining Democrats for a final committee vote of 10 ayes and 13 nays.  Garrett had been criticized for hypocrisy for months, given that he voted twice to eliminate the agency he was nominated to lead. The five other nominees under consideration to fill Vice President, Board of Directors, and Inspector General positions were all advanced.

The GOP is split on Ex-Im Bank, which provides government-backed loans to US companies that export abroad.  Sen. Rounds promotes it as helping companies finance ventures in new markets.  Conservative groups like the Club for Growth oppose the Bank for providing unfair benefits to “corrupt” Washington interests.  Ex-Im’s largest beneficiary is Boeing Airlines, which would have lost out to its main European competitor, Airbus, had the Bank folded.

Shutdown Averted

Speaker Ryan indicated, as he did two weeks ago, that he believed there would be no issues passing the spending bill through the House.  Indeed the House passed the temporary spending bill with a vote of 231-188. Sixteen Republicans defected; 14 Democrats voted in favor.

Defense hawks in the House were far from pleased with Ryan and the measure itself. Overall, conservatives were perturbed by the haphazard manner in which spending has been addressed as this year comes to a close. Ryan threw together a package that focused on healthcare spending and a government surveillance program for the beginning of 2018.  Meanwhile, the Pentagon is still anxiously awaiting the $647 billion it requested from Congress for FY 18.

The bill would provide $2.85 billion to the Children’s Health Insurance Program and $750 million for community health centers and diabetic programs.  FISA 702, a foreign surveillance program that handles ship repairs and a missile defense program also received $750 million and the DoD received $4.7 billion as a temporary fix. The provisions of the bill are scanty and “clean,” as Ryan put it, in order to ensure its passage through both chambers.

Senate Democrats Reject Policy Riders

The bill made it through the Senate last night in a vote of 66-32. On Dec. 8, the date of the passage of the last spending bill, the Senate passed the measure on an 81-14 vote. Many provisions that Democrats have been vying for — such as protections for Dreamers and support for the victims of the opioid epidemic — were left out. Leaders Chuck Schumer and Nancy Pelosi made it clear two weeks ago that they plan to play hardball for such provisions.

Multiple Democrats voted “no” on the spending bill, primarily to send a message. Senator Chuck Schumer emerged from a meeting with the Congressional Hispanic Caucus early Thursday afternoon where he was urged to reject the funding bill. The Senator did persuade others to resist, but it was evident early on that the bill would not be blocked. Such a move indicates how pressing the issue of immigration will be in long-term spending talks.

PAYGO Waiver

A PAYGO waiver accompanied the spending bill to Trump’s desk. The waiver was a small but important rider that allowed Republicans to forgo automatic “Pay As You Go” spending cuts that would have automatically kicked in on January 15 with the substantial increase in the deficit that the tax bill entails. The Senate voted yesterday to waive these automatic cuts in a vote of 91-8 in order to avoid $25 billion in Medicare cuts in 2018.

The waiver’s arrival allowed Trump to sign the Tax Cuts and Jobs Act — his first major legislative achievement — into law this morning. Without the waiver Trump would have had to wait until Jan. 3 to sign the tax bill, and the spending cuts would have been pushed back until 2019. The move saved Republican’s from the harsh backlash that would accompany cuts to Medicare as they strive for reelection next year.

State of Play 

Along with this stopgap measure, the House also whipped up a disaster relief package of $81 billion. Democrats in key states struck by natural disasters like Texas, Florida, and California jumped on board and the bill made it through 251-159.  As an added incentive, the package included disaster relief and Medicare expansion for Puerto Rico and the U.S. Virgin Islands.

The legislation will face resistance in the Senate. Senator Cornyn of Texas, has already said he does not believe it’s in the cards for the package to pass.  Democrats will likely fight tooth and nail and continue to press for other major issues that they expect will receive long-term spending allocation.

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