On January 23, the Senate gave final approval to S. Con. Res. 3, the budget resolution for Fiscal Year 2017. It was due last April.
Why now? Why bother, when the fiscal year has been underway since last October 1?
Inside the beltway, this is all fascinating news, the subject of much discussion, many rumors, and maybe even some bets. But it’s an action that will have consequences for us all, so we need to pay attention. What’s going on?
What’s the point? What does the budget resolution do? The budget is a note from Congress to itself; it isn’t law and it doesn’t have to be signed by the president. It does two things:
(1) It sets totals. It outlines overall spending for discretionary programs (which are supposed to receive appropriations each year) and for mandatory programs (which are already laid out in laws, such as veterans’ benefits and Medicaid.) It also names an amount of revenue (mostly taxes) expected for that fiscal year.
(2) It gives instructions to certain committees to find ways to cut spending (or sometimes, to raise taxes) by a certain amount. These are “reconciliation instructions”— they pin down which committees are responsible for reconciling spending with income.
When the named committees report back the results of their work under the reconciliation instructions, the recommendations are rolled into a single “reconciliation bill.” That bill does become law and does have to be signed by the president, but needs only a simple majority to pass in the Senate (instead of the 60-vote majority that has become the general rule).
This year, the reconciliation instructions are particularly important for two reasons:
(1) They are focused on just two committees in each chamber: Senate Finance and Senate Health, Education, Labor and Pensions (HELP) committees, and House Ways and Means and House Energy and Commerce committees. Each of these committees is charged with reducing spending by $1 trillion over ten years.
(2) And these committees have jurisdictions over the Affordable Care Act and some other programs that are critically important to the lives of many low income people, families, and communities.
Keeping in mind that the Affordable Care Act actually saves money over the long run, and that these committees are instructed to come up with something that saves \$1 trillion more over the next ten years, they face a daunting challenge. If history is any kind of predictor, the reconciliation bills will assume large savings in the “out years” (i.e. many years from now) and won’t really meet the goals in the current Congress.
Nevertheless, there’s opportunity and incentive to cut deeply into other programs overseen by those committees – programs that are critical to many lives. Between them, the Senate HELP Committee and the Senate Finance Committee oversee most of the major health care programs and most of the assistance available to unemployed and elderly people and low-income families.
On the House side, the Ways and Means Committee and the Energy and Commerce Committee cover this same set of critically important programs. They will be writing reconciliation bills that are very likely to include a repeal of the Affordable Care Act and may include a replacement, and that may assign devastating cuts to programs that have nothing extra to spare.
