The Stan Collender Archives

The Irresponsibility Of John Boehner

Stan Collender — Tue, 22 May 2012 10:01:20 +0000

There's not much I need to say to introduce my column from today's Roll Call other than that I really felt I had no choice but to write this as directly as I did. A special shout out to Roll Call for not blinking even once when I told them what I wanted to write this week

The Irresponsibility of Speaker John Boehner

May 22, 2012, Midnight

Like most federal budget watchers, I assumed that the extremely negative political reaction to the federal government shutdowns in 1995 and 1996 meant that tactic wasn’t likely to be threatened again, let alone actually used. That changed last year when a shutdown became the favored approach for many on Capitol Hill.

Although the timetable obviously was much more compressed, I thought much the same thing last summer after the extreme negative reaction to the fight over raising the federal debt ceiling also made that look less likely to happen again in the future. Despite the statements made by Senate Minority Leader Mitch McConnell (Ky.) and other Republicans that using the increase in the federal government’s borrowing limit as leverage to win policy changes was now the new standard operating procedure, the downside was so great that the threat seemed to be mere words.

I was sure that was the case because, unlike the situation in 1995 and 1996, the negative response to the 2011 debt ceiling increase debacle was more than political.

Yes, it was a political nightmare: The approval rating for Congress and the White House fell during and immediately after the battle. But the negative reaction was also material because it resulted in the downgrading of U.S. debt by one of the three major rating agencies.

The downgrade occurred not just because of a concern about the government’s capacity to pay the debt, which wasn’t really questioned but because of what Standard & Poor’s said was the growing inability of the U.S. political system to deal with its fiscal problems. The result was a significant hit to the government’s financial reputation. Most analysts I’ve spoken with are convinced that, were it not for the economic woes in Europe, U.S. interest rates would be much higher as a result.

It seemed so clear that not using the debt ceiling as a weapon had become the minimum price elected officials would have to pay to prevent another possible downgrade that I thought there was no way it would happen again.

That’s why the first major activity by a senior elected official on this topic since then — Speaker John Boehner’s (R-Ohio) choreographed events last week in which he repeatedly said he would prevent the debt ceiling increase that will be needed at the end of 2012 or the start of 2013 from happening unless he got what he wanted — was so exceptionally irresponsible.

I’m using the word “irresponsible” very deliberately.

Boehner is more than just a Member of Congress. As Speaker, he is next in line to the presidency after the vice president and the most powerful person in the House. That magnifies the importance of everything he says. Every Boehner pronouncement about an international issue, for example, is closely monitored around the world. Although the executive branch takes the lead in foreign policy, what the Speaker says typically generates an immediate response and, therefore, he usually treads carefully in this area.

I wish the same were true about what the Speaker does in connection with the federal budget. The Constitution gives Congress specific fiscal policy responsibilities — that makes what this or any Speaker says something that makes headlines and is taken very seriously.

Coming on the heels of last year’s downgrade, the very public way Boehner repeatedly issued his debt ceiling threat made it the equivalent of alerting S&P and the other rating agencies that little had changed since last summer. It also was an invitation to again downgrade U.S. debt.

To make matters worse, Boehner’s statements about the debt ceiling might encourage the agencies not to wait until the debate actually occurs to reconsider their ratings. His statements could provide them with all the evidence they need to justify a new review of the situation now. There’s no word for that other than irresponsible.

Boehner’s threat also was irresponsible because the immediate spending cuts he said were the only way he would allow a debt ceiling increase to be considered is the wrong fiscal policy for the current economic situation. At a time when businesses and consumers are still not spending and most state and local governments are continuing to cut back, the federal government is the only major gross domestic product component enhancing growth and creating jobs. Given the current slow recovery, the large spending cuts Boehner is demanding could push the economy back into recession.

It’s not hard to understand the political motivations behind Boehner taking the position he took on the debt ceiling. He needs the support of the House GOP caucus to remain Speaker. All indications are that, as has been the case since the 2010 election, House Republicans are not in a compromising mood on anything having to do with the federal budget.

Threatening another cliffhanger battle as he did last week doesn’t provide the leadership Boehner said was needed to deal with this. Instead of simply complaining that the president had “lost his” courage when it came to the budget, Boehner should have displayed some of his own.

Instead of following his caucus and doing the political equivalent of tying the debt ceiling increase to the track with a train barreling down, the Speaker should have been developing a way to avoid the downgrade and further erosion of confidence in the U.S. political system that, because of his action, is now more likely to happen.

CNBC Blows It On Bowles-Simpson

Stan Collender — Mon, 21 May 2012 10:16:06 +0000

CNBC isn't for everyone. But I've had it on it my office almost since the day it began, have been a frequent guest since it's earliest days, and think highly of a large number of its people in front of and behind the camera.

Which is why this story from Jeff Cox on CNBC.com was such a disappointment. Cox made the same mistake that others have made...or he drank the same Kool Aid the B-S Cult wants everyone to drink...when he said in his story that the commission had agreed to a report to reduce the deficit.

As regular CG&G readers know, the B-S commission did not issue or agree on a report. The two co-chairs recommended something but that wasn't even voted on let alone actually approved. Eleven of the commission's 18 members informally indicated they supported the co-chairs' recommendation, but there was no vote and the recommendation wasn't approved.

What was most disappointing was Cox's reaction when I tried to point out his mistake. His email back to me said that the fact that the recommendation (he called it a "report") didn't get the required votes was "a parliamentary issue" and that I was "overheated" about it not being approved.

No...I'm not overheated. What I am is is tired of B-S supporters claiming that it was a success and implying that the co-chairs' recommendation was accepted when the truth is that it was rejected and the B-S commission failed as badly as the hardly-super committee.

CNBC can do better. There was no B-S report and saying that there was... apparently intentionally...was a mistake that mislead readers.

Budget Cuts Have Consequences: Ask Andrews Air Force Base

Stan Collender — Mon, 21 May 2012 09:47:47 +0000

I can't tell you the number of focus groups I've watched and polls I read where the overwhelming opinion was that federal spending could be cut without any decrease in the quantity and quality of what the government does.

Hell...As I posted about in 2010, even the recommendation from the co-chairs of the Bowles-Simpson commission -- who definitely should have known better -- proposed a reduction in the number of federal employees and the number of consultants but, presumably based on the assumption that the government wouldn't have to stop doing anything it was already doing, didn't suggest any activity be eliminated.

That's why this story in The Washington Post from several days ago caught my eye. The Defense Department has decided that what since the 1950s has been an annual show for the public at Andrews Air Force Base (now officially Joint Base Andrews) in suburban Maryland will now be held every other year. The savings are projected to be $2.1 million a year.

I have no problem with this decision or the many others like it that no doubt will be made as federal discretionary spending continues to be squeezed. I have posted in the past about how, no matter how valuable it may be in some sense, the annual National Book Festival staged by the Library of Congress should not be held at all.

As my Beautiful and Talented Wife (The BTW) can tell you, I have often railed at similar federal activities (military color guards provided free of charge to pro sports teams are especially annoying) because of their cost. Yes...I take great pride in seeing the Blue Angels do maneuvers and have enjoyed military band concerts. But as a budget guy I see little reason to be paying for that rather than better armor and training for those actually doing the fighting.

Anyone want to bet how long it takes before someone on Capital Hill, most likely someone who claims to be a fiscal conservative, proposes to restore the funds so that this show continues to be held each year? My guess is that the decision will be reversed by October 1 when fiscal 2013 begins.

Boehner Debt Ceiling Statement Wasn’t Surprising; Might Have Been A Huge Miscalculation

Stan Collender — Wed, 16 May 2012 15:18:51 +0000

No one should have been surprised that House Speaker John Boehner yesterday said that he was going to go to war this fall with the White House over the debt ceiling.

Boehner simply doesn’t have the freedom from the House Republican caucus to move away from that extreme/take-no-prisoners position at this point in the year. Had he in any way indicated five+ months before the election and 7 months before not raising the debt ceiling will become a critical problem that he was willing to avoid a fight (let alone use the word “compromise’), Boehner would have been immediately slapped down by other House and Senate Republicans and had one or more GOP members announce that they were going to oppose him for Speaker.

Boehner had no choice and his statement on the debt ceiling was totally predictable.

However valuable Boehner’s hard line was with the base, it’s hard to imagine that his position will help the GOP in any way with the independent voters they will need to be successful in November. His statement and hard line position will remind independents of what they felt last August when, in the wake of the cliffhanger ending, the approval rating for Congress fell to single digits.

Bottom line: This simply was a play by Boehner to keep his job and should not be assumed to be an accurate prediction of what’s to come on the budget in the lame duck session.

Last Week's House "Reconciliation" Bill Was A Hoax

Stan Collender — Tue, 15 May 2012 09:16:29 +0000

My column from today's Roll Call explains why the "reconciliation" bill the House passed last week that the GOP leadership was so proud of and wanted everyone to think was a major accomplishment in reality was a scam, sham, and as close to a budget hoax as you can get.

House ‘Reconciliation’ Bill Was Anything But

Unless the House decides to consider another makes-no-sense-and-has-no-effect bill such as the “reconciliation” bill it passed last week, the fiscal 2013 budget process essentially is over and done with until after Americans go to the polls in November.

Yes, action on appropriations will be needed by the time the fiscal year begins Oct. 1. But even if there is some spending Sturm und Drang, the most likely outcome at that point will be a bipartisan shrug of the shoulders and a short-term continuing resolution that avoids a government shutdown before the election.
That will keep federal departments and agencies funded through part or all of the lame-duck session of Congress that now seems 100 percent inevitable.

So why did the House last week debate and pass the Sequester Replacement Reconciliation Act? Not only is the name a complete misnomer, but the bill won’t accomplish anything.

First, it has nothing to do with reconciliation. Reconciliation can only occur pursuant to instructions in a budget resolution conference report approved by both chambers of Congress. With the Senate unwilling to consider a budget resolution this year, there will be no such agreement.

In addition, reconciliation is the procedure the Congressional Budget Act allows to be used to make changes in mandatory spending and revenues. The House-passed bill focuses on appropriations, and those changes are supposed to be implemented in a different way.

That makes use of the reconciliation label and the implication of the bill’s importance both grossly incorrect and substantially overstated to the point of being all hype and spin. It would have been just as accurate to call what the House passed a constitutional amendment as it was to refer to it as reconciliation.

Second, even if the bill were enacted, it wouldn’t actually replace the sequester — the spending cut that will occur Jan. 2 because the anything-but-super committee failed to agree on a deficit reduction plan. It might be an alternative, but it’s definitely not a replacement.

There are two theories as to why the Republican leadership moved ahead with this bill last week even though it wasn’t what it claimed to be and will never be enacted.

The practical theory is that the House passing the “reconciliation” bill in 2012 will make it much easier for the Senate to move quickly in 2013 to do the same if Republicans are in the majority in the next Congress.

That’s procedurally incorrect and, therefore, makes no sense. As with all other legislation considered but not enacted, this bill will die when Congress adjourns at the end of the year. The new Senate won’t be able to expedite the legislative process by simply taking up what the House previously adopted because, technically, the House will not have yet adopted anything and will have to do so again.

In fact, to do reconciliation next year, the House and Senate will both have to agree on a budget resolution conference report, pass their own reconciliation bills, resolve their differences on those bills and then each agree to the compromise — and that assumes they won’t have to deal with a presidential veto.

That’s a process that won’t be expedited by what the House did last week. Indeed, the most likely timetable for that happening is for both chambers to include a 2013 budget resolution with reconciliation instructions for that fiscal year when they debate and pass a 2014 budget resolution, and that most likely won’t start to happen until April or May at the earliest.

That means that, assuming a 2014 budget resolution is adopted next year, reconciliation for 2013 wouldn’t occur until around June 2013 — five months after the Jan. 2 sequester will have gone into effect.

The other theory about why the Republican leadership insisted that the misnamed, misleading and do-nothing bill be debated and passed is that it’s all political. Passing the bill gave the House GOP another way to show its commitment to cutting spending and demonstrated a desire not to go ahead with the Pentagon spending reductions that are part of the sequester.

In other words, it was just an election-year ploy.

This makes far more sense. The bill the House voted on last week will be great for many GOP candidates on the campaign trail because it will allow them to talk about their willingness to cut domestic spending, not cut military spending and move ahead with the budget process.

But recognizing it’s a political effort is an admission that last week’s debate on the bill really has nothing to do with the federal budget debate. The “reconciliation” bill is the best indication yet that those efforts won’t restart until after Nov. 6.

And in other news: The Treasury last week reported that the federal government had a $59 billion surplus in April. Not only was the surplus larger than expected, it was also the mirror image of last April’s more than $40 billion deficit. No matter what the direction, an almost $100 billion turnaround in any month is news.

There was a time when an April surplus wouldn’t have been news. Most Americans pay their individual income taxes in April, and until the past few years, that made a surplus typical. That makes this April’s results noteworthy and worth watching. If it’s the start of a return to budget normality, the overall budget deficit could begin to be much lower compared with previous years.

This Is Why No One In Washington Wants To Talk About Fiscal Policy

Stan Collender — Mon, 14 May 2012 10:11:33 +0000

Even though it actually was relatively big news, it's not at all surprising that last week's announcement from the Treasury that there was a $59 billion surplus in April wasn't hyped in any way.

As I posted about last week, the better-than-expected $59 billion surplus was an almost $100 billion change from the $40 billion deficit recorded in April 2011. That's an astounding reversal.

What makes it even more astounding is that, although April always used to be a surplus month (that is, after all, when most Americans file and pay their individual income taxes) this was the first April surplus in four years. Although one month doesn't make a trend and shouldn't automatically be assumed to be a sign of what's ahead, the April surplus is noteworthy and definitely is worth watching.

So why didn't the April surplus generate more news?

1. The White House doesn't really want to talk about the deficit even when it would be able to talk about a surplus. Doing that would give the GOP a chance to respond on an issue the administration would prefer to avoid. The back-and-forth on a subject that is politically damaging would last through several news cycles.

2. Talking about a monthly surplus would likely generate criticism from many within the Democratic Party who believe that, given the still-tepid recovery, that's the wrong fiscal policy at this time.

3. Talking about a one-month surplus would almost certainly require that the White House, Treasury, or OMB discuss the projected the deficit for all of fiscal 2012. While that's likely to be $200 billion or more less than what was recorded for 2011, the deficit will still be close to $1 trillion and that would be hard to defend.

This is a little-understood part of the federal budget debate. Even if the 2012 deficit was half of what it was in 2011, and even if that reduction were applauded by Wall Street and the economic community, it would still be a painfully difficult political issue. In fact, long after the deficit has fallen to the point where most economists are comfortable with it, the political advantage will still be with those who criticize it.

George Constanza Budgeting

Stan Collender — Fri, 11 May 2012 09:41:32 +0000

You remember "Seinfeld," the hit NBC show that proudly was about nothing?

If the show was still on the air doing original programs (It's obviously still on the air everywhere all the time in reruns), two federal budget-related events from yesterday no doubt would have inspired the writers and been the fodder for future episodes.

The first was the consideration and passage in the House of what was called the "Sequester Replacement Reconciliation Act of 2012." The fact that the bill was adopted by the House means...wait for it...absolutely nothing because it has no chance whatsoever of being enacted. And in spite of its name, it's not a reconciliation bill and even if it were enacted it wouldn't completely replace the spending cut -- the sequester -- that is scheduled to take effect on January 2, 2013.

Other than that it's very meaningful.

For the record, the vote was 218-199 and all of the ayes were Republicans. The no votes included 16 Republicans and 183 Democrats.

Yesterday's second nothing budget event was the surprise announcement by the Treasury that the United States recorded a more than $59 billion surplus in April.

On the one hand, not only was the surplus larger than expected, it was also the mirror image of last April's more than $40 billion deficit so the results could be an indication that the budget situation is changing for the better. This was, after all, the first monthly surplus since September 2008, that is, in close to four years. So even if April used to always be a surplus month, the fact that it was again in 2012 is as noteworthy as when it didn't happen 2009, 2010 or 2011.

On the other hand, a one-time one-month surplus cannot be assumed to be the start of a trend. It may be, but at this point anyone who says that is doing more wishing and hoping than solid analysis.

More important, even after the April surplus the overall fiscal 2012 deficit is projected to be close to $1 trillion and, therefore, is still a political problem.

In other words, it actually changes nothing.

The Cliff: Coming Soon To A Political Theater Near You

Stan Collender — Tue, 08 May 2012 10:58:01 +0000

As I explain in my column from today's Roll Call, if you're not yet angry about The Cliff, you soon will be and what's taking you so long?

Coming to a Political Theater Near You: The Cliff

I only realized how angry I was about the cliff several days ago when I started to outline this week’s Fiscal Fitness. By the time I sat down to write it several days later, I was fit to be tied and needed to avoid anything that included caffeine.

You know what I mean by the “Fiscal Cliff” — Federal Reserve Chairman Ben Bernanke’s ultimate Fed-speak for the budget apocalypse that could occur between Dec. 31 and Jan. 2. That’s when a series of existing federal-budget-related policies will expire and others will be triggered that could result in an economic calamity.

Actually, “could occur” masks the real situation. The truth is that the cliff is already scheduled to happen. It may be a crisis, but it won’t be unexpected: We know what’s ahead, the precise moment when it will occur and how it will happen.

The cliff includes substantial tax increases on most Americans and significant military and domestic spending cuts that will affect most individuals and almost every business. It also includes another debt ceiling cliffhanger that, if nothing else, could further convince lenders and rating agencies that, for political reasons, the United States is not as good a credit risk today as it has been in the past.

All of this will be happening during the most unstable political environment that could possibly exist — a lame-duck session of Congress — when the work of Representatives and Senators not returning to Washington, D.C., the following year typically is, to be charitable, less reliable. And that’s if they and their staffs, who all have to find new jobs, move or otherwise deal with their soon-to-be-dramatically-changed lives, show up at all.

The cliff has the potential to create some of the most incredible political theater this country has ever seen. It will include drama, Shakespearian-like tragedy, suspense and farce. If it happens, it will involve the murder of enough jobs that it will look like a whole season of “Dexter.” It also will rival HBO’s “Game of Thrones” for twists and turns about who is on top and who is aligned with whom. You’ll laugh, you’ll cry, and the suspense will be intense.

But no matter how great the political theater might be, the cliff really needs to be called what it actually is: pathetic policymaking.

Actually, calling it policymaking gives it way too much credit.

The cliff is the result of a steady series of policy breakdowns over the past few years, especially the multiple failed direct negotiations between the most senior executives in the government including the president, vice president, Speaker, and House and Senate Majority and Minority Leaders. It came after the Senate was unable to get enough votes to create its own budget commission and the presidential commission created in response didn’t get adequate support for a plan to move the process forward. Add in the acknowledged failure of the anything-but-super committee and the inability of the Senate’s “gang of six” to generate enough interest in what it wanted to do, and it becomes obvious that policies have been avoided rather than made.

I get it: The decisions on everything having to do with the federal budget are difficult and, if you’re running for re-election, best left until after Election Day. I also understand that, if you’re a Member of Congress, there’s a politically strategic value to wait until you know which party will be in charge of the House and Senate and the size of the majority before making a decision on how to proceed on the various revenue, spending, deficit and debt questions that have been left hanging. After all, you might get more of what you want after the election than before.

But I also understand more than ever before about how angry many outside the Beltway seem to be about the elections somehow being more important than the economy. Over the past two weeks I have spoken to five different groups that cut across the income and political spectrums, and all have expressed not just dissatisfaction but something close to total disdain about this situation. More than six months before it begins, the cliff is causing a great deal of heartburn.

My anger may be even greater than theirs because I don’t see there being enough time, votes, consensus or willingness to compromise for cliff-related agreements to be reached, translated into legislation, debated and enacted.
In addition, everything that has to be determined during the cliff is related in some way to almost everything else that has to be considered. For example, a decision on the sequester or providing 2012 alternative minimum tax relief, let alone on extending the tax cuts, will change the projected deficit and, therefore, the amount the debt ceiling has to be raised. That means that it really won’t be possible for anything to be decided until everything is decided.

It also means that the most likely outcome of the cliff will be “The Cliff 2: The Budget Strikes Back” coming to a theater near you at some point next year. The hype, complete with full-page ads, online commercials and previews in theaters, will begin to appear this fall.

Paul Ryan's Latest Budget Bill Shows He's Still A Coward

Stan Collender — Mon, 07 May 2012 10:00:52 +0000

After a week off for...well, it's not really clear why other than to campaign Congress took the first week in May off...the House and Senate are returning to Washington this week and immediately getting back to their old tricks when it comes to the federal budget -- doing something that is purely symbolic, has no chance whatsoever of being enacted, and is bad policy to boot. Other than that, it's a great idea.

As far as we know now (Would anyone be surprised if something else popped up?), the most egregiously silly thing that's going to happen on the budget this week is the House's consideration of what House Budget Committee Chairman Paul Ryan (R-WI) is calling a "reconciliation" bill.

This bill would cut $78 billion in spending in fiscal 2013 and cancel the $90 billion spending cut that was triggered when the anything-but-super-committee failed to agree on a deficit reduction plan late last November. The bill also includes an additional $180 billion in spending cuts over the next nine years.

Several things need to be noted about this bill.

First, it has no chance whatsoever of being enacted. The Senate isn't going to consider it, the president would veto it if it managed to pass the Senate, and the votes absolutely don't exist to override the veto. The time spent debating this bill is a total waste of time and taxpayer dollars.

Second, although it's being portrayed as a spending cut, the truth is that the bill would reduce spending LESS than will happen if the January spending cuts are allowed to go into effect as planned. It's not hard to imagine what Ryan and his GOP colleagues would say if this was an effort by Democrats to reduce the size of that spending cut.

Third, technically this is not a reconciliation bill. Reconciliation is the process Congress uses to enforce the revenue and mandatory spending assumptions in a budget resolution conference agreement between the House and Senate. That means (1) there has to be a budget resolution conference agreement, which there isn't this year and (2) the bill is only allowed to include provisions that relate to taxes and mandatory spending programs, and this one doesn't.

Fourth, this is a huge missed opportunity and yet another example of how, in spite of all of the spin, Ryan is a budget coward rather than a leader. A serious effort to develop a compromise with House Democrats could easily have produced a bill that would have passed with bipartisan support and moved the budget debate forward. That would have annoyed some in the Republican and generated some opposition within the House GOP caucus, but the coalition would have passed the bill overwhelmingly. Instead of doing that, Ryan again cowardly decided to pander to the Republican base and in the process prevent the budget debate from moving forward the rest of the year.

Where Has CG&G Been?

Stan Collender — Mon, 07 May 2012 09:27:01 +0000

Thanks for your notes. I'm fine.

I unexpectedly ended up taking two weeks off from CG&G when a combination of planned and unplanned business travel combined with a reaction to the very bad allergy season we're having in the Washington, D.C. area this year to limit the time and energy I could devote to most things. The good news is that the travel is over and the coughing has (mostly) stopped enough for me to get back to work.

The good news is that, intended or not, the brief hiatus gave me a chance to work with Troy on several plans for CG&G that we've been hatching for a while. You'll start to see them shortly.

I truly appreciate the concerns. Now, back to the show.

The Budget Debate Should Not Be Fiscal Instant Messaging

Stan Collender — Tue, 24 Apr 2012 10:40:45 +0000

My column from this morning's Roll Call explains why we'd all be much better off if Congress would use the federal budget debate to do something more than send messages. What else? How about a novel idea like policymaking?

Budget Process Is Not Fiscal Instant Messaging

By Stan Collender
Roll Call Contributing Writer
April 24, 2012, Midnight

One of the things that always impressed me about the earliest days of the Congressional budget process — circa 1977-80 — was how quickly Members of Congress learned to use it to send messages.

When it became clear that the House and Senate Budget committees had little real power (after all, they didn’t have the authority to increase or decrease spending or taxes or change authorizations) and when it dawned on everyone that the process was advisory rather than mandatory, the budget resolutions, the reports that accompanied the budget resolutions and the budget-related floor debates all became ways to tell something to someone.

In some cases, the messages were direct and to the point, as when a committee was told what had been assumed for a specific program or provision within its jurisdiction. In most cases, however, the message was subtler, with the budget resolution based on spending or revenue changes that were reflected in the topline numbers rather than explained in report language or in a colloquy on the floor.

Three things have changed in the decades since the budget process’s message-sending capabilities started to be understood. First, instead of primarily being used as an internal memo to talk to others on Capitol Hill, Members of Congress today use it to reach those outside the Beltway. Second, the messages that once primarily were about Budget Committee preferences on how programs and provisions should be changed are today about electoral maneuvering. Third, the subtle messaging from early days has been replaced by shameless political efforts.

That’s the only conclusion that’s possible after watching how the budget process became the political equivalent of Twitter last week. Economic policymaking — that is, what the budget process is supposed to do — was completely replaced with instant-message-like efforts that definitely were not worth the time, taxpayer money or energy it took to send the messages.

The House, which in recent years has already done enough silly things on the budget to merit a lifetime achievement award, took it one step further last week by moving ahead with reconciliation based on the instructions included in the budget resolution it passed late last month.
That may not seem to be a bad thing until you remember that reconciliation is the process that, according to the Congressional Budget Act, is used only to enforce a budget resolution conference agreement and not what either the House or Senate wants to do on its own. With the Senate already indicating that it has no plans to do a budget resolution this year, there’s no chance that there will be a budget resolution conference report and, therefore, no chance that reconciliation will occur.

That makes everything the House does to comply with the reconciliation instructions in its own budget resolution nothing more than a messaging effort by the Republican majority to tell the GOP base this is why it deserves to be re-elected. Never mind that what it passed has no chance of being enacted.

Meanwhile, Senate Budget Chairman Kent Conrad (D-N.D.) last week moved ahead (albeit without votes or amendments) with plans to consider a budget resolution that he proudly proclaimed was based on the recommendations included by the Bowles-Simpson commission in its final report.

Here again, that might not appear to be such a bad thing until you realize that the Bowles-Simpson commission didn’t actually produce a report. In fact, what its cult-like supporters like to call the Bowles-Simpson report is nothing more than what the commission’s two co-chairmen proposed: Their recommendation was never voted on because they didn’t have enough support from other commission members to keep the process going.

But that’s not all. The House overwhelmingly rejected the Bowles-Simpson commission last month when something resembling what the co-chairmen proposed was offered as a substitute for the budget resolution put together by Budget Chairman Paul Ryan (R-Wis.).

Not only was Ryan one of the Bowles-Simpson commission members whose opposition doomed the plan when it first was recommended by the co-chairmen, he also rejected using it as the basis for what he recommended in his own committee and then voted against the Bowles-Simpson amendment when it was offered on the floor. Ryan would lead the House conferees if there were a budget resolution conference this year, so his repeated opposition means that any plan called Bowles-Simpson almost certainly is doomed before it begins. Add the embarrassing bipartisan opposition to the plan when the House debated it last month, and the possibility that it could succeed in the current environment is zero.

That makes the message — Bowles-Simpson is worthwhile, and we support it — doubly curious. The Bowles-Simpson recommendation is a thoroughly discredited concept. But, and far more importantly, in the same way that the House reconciliation efforts based on its own budget resolution have no chance of being enacted, a Bowles-Simpson-based budget resolution coming from the Senate also will go nowhere.

There are better ways to send the federal budget-related messages that need to be sent. If the House (or Senate) wants to move forward, why not actually send the other body a real message by asking it to meet to see if something can be worked out?

The alternative of just passing or considering legislation that will never become law is the type of message that will never be received.

Comments Policy: One More Time With Feeling

Stan Collender — Fri, 20 Apr 2012 11:37:54 +0000

It's been a while since I posted CG&G's comments policy, and strange things happen when it's not reproduced every once in a while. So...

1. Comments must be made in the comments section for a post and not by using the "Contact Us" form.

2. CG&G moderates comments and all comments are reviewed before they're posted.

3. I welcome, appreciate, and enjoy (at least most of the time) substantive comments and strong opinions regardless of whether they agree or disagree with something that's been posted. (Obviously, I enjoy those that agree the most.)

4. But the following will prevent your comment from being published:

Personal attacks on me or any of the commenters
Cursing
Comments that are attempts to sell term papers, organ enhancement, wedding dresses, investment opportunities or anything else.
Comments with user names that link to websites that sell term papers, organ enhancement, wedding dresses, investment opportunities or anything else
Comments posted under multiple names (trust me, it's not that hard to figure out)

5. CG&G also reserves the right to limit the size and number of comments from a particular commenter. This is my blog, not yours.

Yes...I know that limiting comments may convince some people not to return to CG&G. I also know that it encourages others to come back.

2013 Budget Debate May Be Setting The Standard For Crazy

Stan Collender — Thu, 19 Apr 2012 11:33:43 +0000

If you weren't convinced that anything related to the federal budget on Capital Hill is completely nuts this year, just think about these three things, all of which are happening this week:

1. The House is putting together a FY13 reconciliation package based on the GOP/Ryan plan it passed earlier this year even though (1) reconciliation is required to be based on the budget resolution conference agreement between the House and the Senate, (2) there will be no budget resolution conference report agreement this year and, therefore, there will be no reconciliation, and (3) nothing the House considers for its own private reconciliation has any chance of actually (or perhaps ever) being enacted.

2. The Senate Budget Committee is trying to mark up a FY 13 budget resolution that Senate Majority Leader Harry Reid (D-NV) has already said will not be considered by the full Senate.

3. The budget resolution that will be offered in the Senate Budget Committee is based on the plan proposed by the two chairs of the Bowles-Simpson commission that is thoroughly discredited after (1) the commission itself failed to approve it and (2) the House resoundingly rejected a similar plan just weeks ago.

Note: This would be worthy of a skit on The Daily Show or Weekend Update on Saturday Night Live if it weren't so incredibly sad.

Less Will Happen In The Lame Duck Than You Think

Stan Collender — Tue, 17 Apr 2012 13:12:04 +0000

As my column from today's Roll Call explains, if you've been thinking that everything will be settled in the lame duck session of Congress that's ahead, think again...and again...and again. Would you believe that nothing will be settled?

Expect Less, Not More, in Lame-Duck Session

By Stan Collender
Roll Call Contributing Writer
April 17, 2012, Midnight

I’m always surprised that federal budget watchers learn so little from even the very recent past.

After almost two years of continuing expectations that the next budget-related opportunity is going to result in the “big deal,” we should all know and admit by now that when it comes to federal spending, revenues, the deficit and the national debt, dreams hardly ever come true.

But the steady series of dashed budget hopes since the 2010 elections — the inability of the Senate to agree to a Congressional deficit reduction commission, the abject failure of the Bowles-Simpson commission, the collapse of the anything-but-super committee and the consecutive breakdowns of the negotiations between Vice President Joseph Biden and House Majority Leader Eric Cantor (R-Va.) and then between President Barack Obama and Speaker John Boehner (R-Ohio) — don’t seem to have changed the positive outlook about what is commonly thought of as the next opportunity: the lame-duck session of Congress.

The current fiscal wish, hope and prayer is that this is when all sides will join hands in the long-awaited budget Kumbaya moment and the deal that has been so elusive will come together.

The only problem is that there’s far more evidence pointing to nothing significant happening on the federal budget during the lame duck than to a big (or even symbolic small to medium-sized) deal.

Leave the politics of the lame duck aside for a moment and start with logistics: There simply won’t be that much time for Congress to deal with all of the big budget issues facing it after the elections. The approximately seven weeks between Election Day and the failure-of-the-hardly-super-committee-triggered sequester on Jan. 2 probably translates into no more than four weeks of workable time when you realize that Congress is not likely to return to Washington, D.C., immediately after Nov. 6, that much of at least one of the seven weeks will be devoted to organizing for next year and that there will be time away from the Capitol for Thanksgiving and Christmas.

This almost guarantees that the comprehensive tax reform package that many say is possible/likely/doable in the lame duck won’t happen. Even if there were an agreement on what that should include — and there absolutely isn’t — it would take longer than four to seven weeks just to draft the basic legislation, let alone debate and pass it in committee, debate and pass it in the full House and Senate, come up with a compromise agreement between the two chambers, redraft the compromise and pass the conference report. Add in the need for transition rules, which took a year to draft when the 1986 tax act was adopted, and it’s ludicrous to think that tax reform has any chance of going anywhere during the lame duck.

But the lack of time won’t be the only, or perhaps even the most important, logistical problem. As anyone who has ever been through a lame-duck session knows, rounding up votes almost always is far more difficult after an election than it is before. If past lame ducks are a guide, many of the Representatives and Senators who will not be returning to Congress next year will be more focused on getting a job, packing up their offices and moving their families than on what’s happening in their committees or being debated on the floor. At some point, the retiring and defeated Members will have to vacate their office suites so that the newly elected Members can move in, making it physically and psychologically difficult to focus on work. And, of course, the staff for the soon-to-be former Members, who do much of the substantive work, will also be actively looking for new jobs or moving and also won’t have an office to go to.

As it has in the past, this will create huge headaches for the Republican and Democratic leadership. Not only will the political imperatives have changed for Members who will not be returning next year, but the ability to discipline those who are leaving will be completely eliminated.

Add to that the strong possibility that some retiring and defeated Members may not vote at all, and it’s not hard to see why the close votes that have been typical of almost anything having to do with the budget the past few years may have to or should be avoided during the lame-duck session.

And then there’s the politics of the federal budget. Does anyone really think that the extreme partisanship and vitriol that has only grown since the 2010 elections will suddenly disappear or substantially subside on Nov. 7? Is it really possible that what is likely to be one of the most negative campaigns in U.S. history will make it easier to compromise after the elections are over? No matter what the election results, will either political party be willing to give away its ability to score points on the most contentious issues by agreeing to a compromise on spending and taxes, especially if it doesn’t include tax reform?

I have two predictions based on all of this. First, instead of a big budget deal, the most likely result by far is that stopgap, temporary fixes will be put in place for at least several months (and possibly a year) for all of the major spending and revenue decisions that are coming due. Second, although they obviously shouldn’t be, federal budget watchers will again express surprise and disappointment when this happens.

The B-S Cult Is Alive! Isn't Judd Gregg Supposed To Be Politically Astute?

Stan Collender — Mon, 16 Apr 2012 21:59:38 +0000

Several weeks ago I posted for the first time about the Bowles-Simpson cult, the supposedly smart, sincere people who keep trying to resurrect the B-S plan as if it were a budget deity even though it has never proven to have any significant support.

It's now clear that former Senator Judd Gregg (R-NH) is a member member of the B-S cult.

Gregg has an op-ed in The Hill today extolling the virtues of the Bowles-Simpson commission that makes so little sense you have to wonder what, if anything he was thinking when it was submitted for publication.

According to Gregg, compared to the chaos that is likely in the lame duck, "What is needed is a more orderly and thoughtful course that produces the long-term savings without the draconian (sic) and ham-handed actions currently proposed."

So far so good.

But then Gregg says "The only viable, bipartisan vehicle that has been put forward to produce such an orderly reduction in our debt is the plan offered by former Sen. Alan Simpson (R-Wyo.) and former White House Chief of Staff Erskine Bowles" and proposes that the B-S commission be reconstituted.

He then goes on to criticize House Budget Committee Chairman Paul Ryan's (R-WI) budget for being too partisan and "not legislatively viable."

And he says "Bowles and Simpson may be the only two people in Washington who have the credibility and track record to get it done."

Lets see...

1. The B-S process was anything but orderly. It missed deadlines, didn't include a vote on the chairmen's proposal, and died without having enough support to push the plan to a vote in Congress.

2. As budget committee chairman, Ryan will have to agree to any new B-S effort. But as a B-S member, Ryan indicated that he opposed what Bowles and Simpson proposed last time. In fact, it was Ryan and another B-S member -- House Ways and Means Committee Chairman Dave Camp (R-MI) -- whose opposition to B-S was largely responsible for it not moving forward.

And Ryan voted against the B-S budget amendment that was resoundingly defeated 38 to 382 when it was offered as an alternative to the Ryan plan several weeks ago.

3. In other words, it's already been proven that Bowles and Simpson and their plan have no credibility on the budget whatsoever.

House Budget Committee Chairman Paul Ryan Is A Coward

Stan Collender — Mon, 16 Apr 2012 21:21:31 +0000

One of the most interesting aspects of the fiscal 2013 budget debate is how the GOP is extolling the virtues of House Budget Committee Chairman Paul Ryan (R-WI) but, while taking credit for it passing the House is only talking about his budget plan in the most general terms.

In fact, as Congress gets back to work this week after two weeks back in the district for Easter and Passover, watch closely as Republicans talk about how "courageous" Ryan is for taking the lead on reducing the deficit while it stays as far away as possible from any discussion of the specifics spending reductions and tax cuts.

The reality, however, is just the opposite: When it comes to the budget Ryan is far more of a coward than anything else.

It wasn't at all courageous for Ryan to propose tax cuts and deep spending reductions that only House Republicans would approve. That's the federal budget equivalent of throwing raw meet to piranhas and then saying that you deserve credit for feeding them what they want to eat.

The courageous move would have been to propose a budget plan that challenged the GOP majority and attracted Democratic votes, that is, that was a compromise in the midst of hyper partisanship. That would have been far more difficult both substantively and politically -- like trying to feed raw vegetables to piranhas by hand while your in the water with them -- and would indeed have qualified as daring and leadership.

Ryan also gets no budget medal because he refused to specify which tax breaks would be curtailed to pay for his tax cut plan. Here again, the opposite -- having the testicular fortitude to challenge politically popular tax breaks and the individuals and businesses that get them -- would have been the courageous thing to do.

Completely refusing to name the tax breaks may have been good politics but it was also whatever word or phrase you want to use for "the opposite of courageous." Note: All suggestions accepted and encouraged.

Stan. CNBC. 430 pm. Today

Stan Collender — Tue, 10 Apr 2012 14:26:09 +0000

Talking about the Buffett Rule.

Gordon Adams: Paul Ryan And A Real Military Budget Don't Mix

Stan Collender — Tue, 10 Apr 2012 09:35:09 +0000

CG&G alum Gordon Adams had a good piece published in Time magazine's Battleland Blog ("Where military intelligence is not a contradiction in terms") about the phony debate on military spending House Budget Committee Chairman Paul Ryan (R-WI) tried to create with his budget resolution.

As Gordon points out, according to Ryan, falling Pentagon spending by any measure -- real, nominal, imaginary, whatever -- is always a bad thing. Never mind what the generals who run the military say and pay no mind to the strategy behind the numbers or the threat for which the U.S. is preparing. Apparently, we're all going to hell and the country is doomed if DOD has less to spend.

Really?

I've always been amused at the ability of congressional Republicans to take what the generals and admirals say as gospel when it confirms what the GOP wants to do but to do what Ryan did -- dismiss it out of hand -- when those same military leaders say something different than what they want to have said.

In the now closer-to-four-than-three decades I've been involved with the federal budget in some way, it has never ceased to amaze me that congressional Republicans are able to detect waste, fraud, abuse and overspending from a mile away when it involves a domestic program but are completely deaf, dumb and blind to the same thing when it involves the Pentagon. Why is it, for example, that an extra sandwich in a school lunch program is waste while an extra missile that will never be used and wasn't requested by DOD is vital to national security?

Thank You Teresa Tritch: Reducing The Deficit Is Not Always The Correct Policy

Stan Collender — Mon, 09 Apr 2012 09:19:24 +0000

Teresa Tritch, a long-time friend from what now seems like a previous life who currently is at the New York Times, had a great fact-laden, long-form editorial in the Sunday paper about what it's going to take for the recession to be over in peoples' lives rather than just reflected in the headline statistics.

The whole piece is definitely worth reading, but here's the money quote:

What distinguishes this jobs recovery from others is the sheer scale of the job loss that preceded it. The economy has regained 3.6 million jobs since employment hit bottom in February 2010, but it is still missing nearly 10 million jobs — 5.2 million lost in the recession and 4.7 million needed to employ new entrants to the labor market. The Economic Policy Institute estimates that at the average rate of job creation in the last three months, it would take until the end of 2017, fully 10 years from the start of the Great Recession in December 2007, to return to the pre-recession jobless rate of 5 percent.

Several points need to be made about the piece.

First, Teresa's point about how long it took for "the job gap" from the 2001 recession to close is especially important in the context of the the current economic recovery. The number of jobs was artificially high and the unemployment rate unofficially low by the time the 2008 recession began because of housing that we now know was ridiculously overvalued. Combine the bubble with the ability of consumers to borrow against the overinflated prices and homeowners to get absurd prices when they sold and it's easy to see how business was stimulated to expand and hire to take advantage of the higher demand for...well...everything but what economists call inferior goods.

In other words, judging the strength of the recovery by a standard that requires the number of jobs to return to the previous high likely is not as possible now as it was before and, as Teresa points out, it wasn't that easy before either.

Second, Teresa's point about at the end about the need for the appropriate fiscal policy rather than an economically blindfolded allegiance to deficit reduction is exactly right.

The right time to make significant progress on the federal deficit is when the private sector is driving the economy and that means it should have happened in 2005-2007. Those who stood by and watched as spending was increased and revenues reduced when the time to reduce the deficit was right shouldn't be given any credibility to whine about not doing something now when it's not.

Paul Krugman Is Wrong

Stan Collender — Wed, 04 Apr 2012 22:34:20 +0000

Over at his own blog, Paul Krugman said some nice things about my blog post from Monday on Bowles-Simpson.

But he got one thing wrong: No one...and I mean absolutely no one...has ever before called me "mild-mannered." If you don't believe me, just ask my Beautiful and Talented Wife (The BTW).