In a sharp deviation from tradition, Senate Budget Committee Chair Michael Enzi (R-WY) and House Budget Committee Chair Tom (R-GA) Price issued a joint statement on February 4 announcing they will not invite Office of Management and Budget Director Shaun Donovan before their respective committees to testify on President Barack Obama’s FY17 budget request, which will be released on February 9. “It is clear that this President will not put forth the budget effort that our times and our country require. Instead of hearing from an Administration unconcerned with our $19 trillion in debt, we should focus on how to reform America’s broken budget process and restore the trust of hardworking taxpayers,” Chair Enzi said.
Democratic leaders condemned the decision not to hear from Director Donovan. House Budget Committee Ranking Member Chris Van Hollen (D-MD) said, “It is a sad day for this institution when Congress snubs the president and the interests of working families with such an egregious abdication of our duty to the American people." The move will undermine efforts to advance bipartisanship in the FY17 budget process.
At a February 4 House Budget Committee hearing on the Congressional Budget Office’s (CBO) most recent budget and economic outlook, Chair Price (R-GA) said that the best way to decrease the federal deficit is to decrease spending and grow the economy. In January, CBO reported that their 10-year deficit projection had increased by $1.5 trillion since its last estimate in August 2015, largely due to the extension of tax cuts enacted in December (see Memo, 1/25). Chair Price opposed increasing revenues, stating, “[W]e ought to focus on real solutions: reforms that will make government more efficient, effective and accountable and solutions that will support a stronger, healthier economy.”
Committee Ranking Member Chris Van Hollen (D-MD) stated that increasing revenues through tax reforms should be included in deficit reduction efforts: “[A]s we look to the long term deficit, we should also remember that the largest category [of spending], according to the Congressional Budget Office, are the so-called tax expenditures. These include a lot of tax breaks in the tax code that benefit the very wealthiest Americans. They include tax breaks like the carried interest loophole for hedge fund managers, which means that folks who are managing a hedge fund pay a lower tax rate than people driving a bus, or our teachers.”
The House is expected to pass its budget resolution by the third week of March. House leadership is holding to the Bipartisan Budget Act of 2015 (BBA) spending caps enacted in December, but is under pressure from the most conservative House members to reduce discretionary funding to below the caps. Under the BBA, nondefense discretionary funding for FY17 will be approximately level with FY16 spending.
Meanwhile, appropriators have begun scheduling hearings on FY17 spending bills. The House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies has scheduled a hearing for February 11, 10:30am ET in room 2362-A of the Rayburn House Office Building. Witnesses will include the Department of Agriculture’s Secretary Thomas Vilsack, Chief Economist Robert Johansson, and Budget Officer Michael Young.
The joint statement from Chairs Price and Enzi is at: http://1.usa.gov/1nMuQfx
Materials from the House Budget Committee’s February 4 hearing are at: http://1.usa.gov/1nShtuN