–Health Care, Financial Reform Consume Congress’s Time, Attention
–Lawmakers See Little To Gain By Working on Budget, Annual Spend Bills
–Congress Hopes To Finish Work Soon On Tax Extenders, War Spending Bill

By John Shaw

WASHINGTON (MNI) – Consumed for the past two years by the huge
challenges of overhauling the nation’s health care and financial
regulatory systems and facing among the darkest fiscal projections in
American history, Congress has shown little interest in doing its basic
budget work this year.

Specifically, neither the House nor Senate has passed its annual
budget resolution which sets five-year spending and revenue goals and
makes deficit estimates.

Congress is required by law by pass annual budget resolutions by
April 15.

In addition to setting broad fiscal goals, a budget resolution sets
a ceiling on discretionary spending for the coming year which then
triggers work on the 12 annual spending bills that fund discretionary
programs.

Bob Bixby, the executive director of the Concord Coalition, said
Congress this year is showing little interest in working on either a
fiscal year 2011 budget resolution or the 12 appropriations bills for
the fiscal year which begins Oct 1.

Bixby said the nation’s huge budget deficits have convinced many
lawmakers that there is little upside in trying to tackle a problem that
is so hard to solve.

“For Congress, it seems the deficit is a problem that is too big to
face or to fix. So they are trying to stay as far away from it as they
can,” Bixby said.

“The things they are supposed to do on the budget are hard–and
they don’t want to do them. So they aren’t doing them. There is no way
to make the budget numbers look good,” he said.

Bixby said Congress will be able to pass stop-gap spending bills to
keep the government operating even if it doesn’t pass the 12 regular
spending bills.

Senate Budget Committee Chairman Kent Conrad told reporters last
week that he is trying to persuade his Democratic colleagues to consider
the budget resolution that his panel approved several weeks ago.

This plan, he said, would reduce budget deficits from 10% of GDP to
3% of GDP.

Conrad’s five year fiscal plan would ratchet budget deficits down
from $1.4 trillion in fiscal year 2010 to $545 billion in FY’15. A
deficit of $545 billion in FY’15 would represent about 3% of GDP.

Conrad’s budget allocates $1.122 trillion for discretionary
programs in FY’11. This is $4 billion below President Obama’s request.

Bixby said the Conrad plan is “far from perfect, but is at least an
attempt to begin taking on the deficit. At this point, I would be happy
if Congress passes something like this.”

But House Democratic leaders have shown little interest in bringing
up a budget resolution this year.

In a recent briefing, House Speaker Nancy Pelosi signalled clearly
that House Democrats will not try to pass a five-year fiscal blueprint
this year. She said there are “several other ways to meet our
responsibility” regarding the budget.

Pelosi avoided two direction questions on her intentions about
passing a fiscal year 2011 budget resolution.

But her evasions confirmed that she is looking for a different
process to allow Congress to eventually pass the 12 annual spending
bills that fund the discretionary portion of the federal budget.

Of the $3.8 trillion federal budget, more than $1 trillion is in
the discretionary portion of the budget which is allocated in the annual
spending bills.

Congress could pass a resolution that “deems” the budget is passed,
thus setting a ceiling on discretionary spending to allow work to
advance on the FY’11 appropriations bills.

When Republicans controlled Congress and failed to pass budget
resolutions, Democrats blasted them for failing to fulfill one of their
primary responsibilities — setting overall fiscal goals.

When Congress returns next week, the House is expected to take up
an emergency spending bill. The Senate passed a $69 billion version last
week; the House version is nearly $90 billion.

The Senate is expected to soon consider a $113 billion package of
tax cuts and benefit extensions which the House approved last week.

The package passed by the House would extend about a dozen tax cuts
that expired at the end of last year, expand unemployment benefits, and
provide a 19 month extension of current Medicare payments for doctors,
the so-called “doc fix.”

“The tax extenders and the war spending are seen as far less
controversial and politically risky than the budget resolution and the
appropriations bills,” Bixby said.

“So Congress will do them,” he added.

Stan Collender, a budget expert at Qorvis Communications, said the
Democratic decision to avoid work this year on a budget resolution and
annual spending bills is unfortunate but understandable.

“The budget has become such a toxic issue and so politically
explosive that no one wants to take it on. And the fact is that as long
as the government continues to operate and people can get their visas
processed and go to national parks they don’t really care if the regular
budget process is followed,” he said.

** Market News International Washington Bureau: 202-371-2121 **

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