President Trump’s 2020 budget called for boosting defense spending to $750 billion, largely by using what fiscal hawks decried as a gimmick: relying on an off-the-books account meant for war funding. The Senate Republican budget resolution released last week went a different way, calling for the restoration of spending caps that would cut some $126 billion in both defense and non-defense spending compared to this year.
That raises questions about whether Trump’s desired increase in defense spending will happen, The Hill’s Niv Ellis reports:
“The expectation among congressional staff was that the GOP would adopt [Trump’s $750 billion] figure, without the gimmicks, and Democrats would push for an equal increase in nondefense spending.” Instead, the resolution released by Senate Budget Committee Chairman Mike Enzi (R-WY) “seemed to rebuke Trump’s decision to stash $96 billion in new defense spending in an account known as the Overseas Contingency Operation (OCO) fund. Instead of adding to OCO, as Trump suggested, Enzi drew down the funds in the account and phased them out altogether after two years.”
Enzi’s budget left room for a potential deal that would lift defense spending to Trump’s desired level, as long as the costs are offset. Budget watchdogs praised the proposal, with the Committee for a Responsible Federal Budget saying it “adopts a more achievable fiscal goal, bringing a much-needed dose of realism and fiscal responsibility to the budget process.”
What happens next: The real negotiations are just getting going. Lawmakers must reach agreement on spending levels for next year. Caps set under the 2011 Budget Control Act are set to take effect once again, potentially resulting in an automatic 10 percent reduction ($126 billion) in discretionary spending for 2020. Democrats want any increases in defense spending to be matched by increased in non-defense outlays.
But with Democrats struggling to propose their own budget as moderate and progressive factions within the party each push their priorities, the Senate GOP resolution “has left the question wide open on where the final numbers will end up,” Ellis writes. “But even if the GOP backs down on Trump’s $750 billion figure, Democrats say nondefense spending has to increase at least $20 billion just to keep programs running, a result of new costs pushed onto the budget this year,” including the census and a veterans program that used to get funding elsewhere.
The bottom line: Things could get messy again. “Even after congressional leaders agree to new spending caps,” Ellis says, “they will still have to contend with Trump and his request for $8.6 billion to fund his border wall.”