The inability of Congress to fund the government on time without drama is not one-sided. And here we are again!  TCS Vice President, Autumn Hanna, and TCS Senior Policy Analyst Josh Sewell, join show host Steve Ellis to explain the bipartisan affliction known as the Continuing Resolution and why curing it requires a bipartisan solution.

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Episode 30– Transcript

Announcer:

Welcome to Budget Watchdog All Federal the podcast dedicated to making sense of the budget, spending, and tax issues facing the nation. Cut through the partisan rhetoric and talking points for the facts about what’s being talked about, bandies about, pushed in Washington brought to you by Taxpayers for Common Sense. And now the host of Budget Watchdog TCS president Steve Ellis.

Steve Ellis:

Welcome to all American taxpayers Seeking common sense. You’ve made it to the right place. For over 25 years TCS, that’s Taxpayers for Common Sense, has served as an independent non-partisan budget watchdog group based in Washington DC.

Steve Ellis:

We believe in fiscal policy for America that is based on facts. We believe in transparency and accountability because no matter where you are in the political spectrum no one wants to see their tax dollars wasted. Well, Congress tick tock your time is up and that is no surprise.

Steve Ellis:

Dear podcast listeners, the inability of Congress to fund the government on time without drama is not one-sided and neither is it a once in a while kind of thing. The last time all spending bills were completed on time was 1997. And the last time all spending bills were done on time and past individually, so-called regular order, was 1994.

Steve Ellis:

Joining us now on our 30th episode of Budget Watchdog AF to help explain the bipartisan affliction that needs a bipartisan solution is TCS Vice President Autumn Hanna-

Autumn Hanna:

Hi Steve.

Steve Ellis:

… and TCS Senior Policy Analyst Josh Agriculture Sewell.

Josh Sewell:

Hey, happy to be here regular and in order.

Steve Ellis:

All right. Let’s start with the basics. Autumn, what is a continuing resolution and why is it needed?

Autumn Hanna:

Well, Steve, a continuing resolution, often called the CR for short, is a temporary stop gap measure to keep the government funded and running when Congress fails to pass its spending bills, the 12 bills including defense, ag, energy, energy and water that is, health and human services, transportation, and they fail to pass them through regular order. The CR continues funding at the previous year’s level, essentially kicking the can down the road. And the idea is that it gives Congress more time to finish negotiations on the spending deals, but lately it’s become more regular order than regular order.

Steve Ellis:

You’re right about that. Let me see here. Carry the one. Yeah, so since 1998 there have been 128 CRS ranging in length from one day, that was numerous times in 2001, to 365 days and that was 2013. And the alternative to a CR is a government shutdown, which nobody wants just to be clear or shouldn’t want. But let’s go back to today. What needs to happen and when does the government turn into a pumpkin?

Autumn Hanna:

The appropriations bills must be passed by September 30th, the last day of the federal fiscal year. So this week that means Congress has until Friday at midnight to get this done or the government shuts down. Nothing like waiting until the 11th hour.

Autumn Hanna:

Today the Senate is holding a procedural vote and if that succeeds, they’ll move on to a vote on final passage. Then it’s off to the House for them to act. So there are several steps still where things could go south and there’s really not a lot of room for error. The one thing going on in everyone’s favor though is that neither Republicans or Democrats want a government shutdown going into midterm elections.

Steve Ellis:

Yeah, nobody looks good and nobody wins out of shutdowns, not either party and certainly not taxpayers. So speaking of that, autumn, why do we care? I mean, explain why a CR is bad for taxpayers?

Autumn Hanna:

So CRs make the government incredibly inefficient. Just the threat of a CR or shutdown has agencies delaying hires and traveling leading all the way up to September. So this is something we start to see earlier in the summer that we’re not getting things done and agencies start to scramble. And so already we’re filling the consequences of these last minute deals.

Autumn Hanna:

Once agencies are operating under a CR their budgets are frozen in amber. They can’t plan. They can’t commit to contracts and spending beyond the length of the CR. Some things that were important the previous year, but not the next will continue to get funding and vice versa.

Steve Ellis:

Got it. The one that really sticks out in my mind is on this point is the decennial census spending in the years leading up to the census is really important, but after the census it’s less important. But with the CR it can remain the same when you’re talking about it on that every 10 year cycle.

Steve Ellis:

Okay. Josh, turning to you, can you fill in some details on why we are here now? I mean, have both chambers failed to pass appropriations bills?

Josh Sewell:

Yeah, to an extent. So the House has passed 6 of its 12 appropriations bills and they did that in an omnibus package where they put them all together back on July 20th. Now the other six actually in the house made it out of committee, but they haven’t seen action before the whole Congress. So these still to do ones are frankly the harder ones. Defense, Homeland Security, Labor HHS, these are the kind of bills that are either really large and have a lot of spending or they have some tricky issues policy-wise.

Josh Sewell:

Now the Senate, it’s a little slower. So about a week after the house omnibus, just in time for August recess, Senate appropriators released text for each of their bills, but then they just moved on to the reconciliation package and haven’t really looked back.

Steve Ellis:

Just to be clear, that means they just put the bills out so that people could see what they were, but the committees haven’t even approved them, right?

Josh Sewell:

Yeah, they did not have their markups, as it’s called, to get the final language and approve it to get it pushed into the full chamber.

Steve Ellis:

Gotcha. Okay. So Josh, is this a clean CR or are there some changes mucking it up, the so-called anomalies?

Josh Sewell:

Yeah, unicorns don’t exist. So no, you cannot do a clean CR, not just because of things like the census spending that you mentioned. Agencies need exceptions to start new contracts funding formulas that disperse based on the fiscal year. They have to be allowed to obligate and spend money for the new fiscal year.

Josh Sewell:

So you can’t just take last year’s bill and pass it again. There are technical things that have to change and a whole bunch of them are just technical changes that must happen. So this administration sent about 25 pages worth of requested anomalies and eventually the CR draft that we’ve seen that the Senate released is 237 pages long when you count everything that’s has one of those anomalies or the various pieces that are catching a ride on this spending train.

Steve Ellis:

Okay. So enlighten our listeners, Josh. So what are some of these anomalies this year?

Josh Sewell:

Well, you’ve got a lot of standard fair, as I say, because again, this is becoming the regular order unfortunately. So you have extension of contract authority for various agencies that do that. The DC government is allowed to spend its locally raised tax revenue under the same conditions as last year.

Josh Sewell:

Now there are a few that are more unique to this year. So I saw there’s 21 million for a national cyber director and that was a post that was created last year but now is being funded. There’s 112 1/2 half million dollars for federal court security. And that’s actually emergency spending and that’s being done in the wake of the controversial judicial decisions and subsequent protests we’ve seen.

Josh Sewell:

And another big one I saw is there’s two and a half billion dollars in assistance for the Hermits Peak/ Calf Canyon fire. You may remember that’s that massive wildfire in New Mexico. And that funding is actually transferred from unspent FEMA disaster funds provided in the CARES Act back in March, 2020. So definitely real anomalies there. And there’s dozens more.

Steve Ellis:

Just seen that Hurricane Ian is making its way across Cuba and into the Gulf. Is there extra cash for other priorities like either Ian or for Puerto Rico post hurricane Fiona? And anything else that’s extra that’s getting funded?

Josh Sewell:

Yeah, quite a bit and it’s actually not technically an anomaly. There is a whole supplemental spending bill attached to this package and that’s the Division B, the second thing they do. And in that spending bill, you have about $16 billion in emergency funding for Ukraine, another 20 million for the water crisis in Jackson, Mississippi.

Josh Sewell:

And there’s various other things that the administration had asked for in its request for anomalies and additional priorities. So resettling the Afghan refugees from the pullout of the United States there a little over a year ago. And I saw there was a billion dollars in heating assistance for low income families. And then again, something we see a lot in these things, a five year reauthorization of the FDA’s user fee programs. And our perennial favorite seems like a flood insurance reauthorization once again catches a riot on one of these last minute must pass deals.

Josh Sewell:

So I have not seen money specifically for Puerto Rico or Florida, but there is authority for FEMA, Federal Emergency Management Agency, to spend from the disaster relief fund at a higher rate moving forward to cover disasters. And so I looked it up this morning that the August report on the DRF showed there was a $15 billion balance and that certainly won’t be enough for Puerto Rico and certainly if we have a significant hit in Florida, but it should cover things for a while.

Steve Ellis:

Wow. And I think one of the things that we noticed too is there’s some extra cash in there for ammunition to resupply, but there’s some interesting twist to that, isn’t there, Josh?

Josh Sewell:

Yeah, this is what Budget Watchdog FA frequent flyer Wendy Jordan found for us is that the administration had requested about $13 million worth of funds to pay for some replenishing of stocks of anti tank munitions in Ukraine. And instead of simply $13 million they’re getting more than $500 million Congress has provided.

Josh Sewell:

But instead of procuring weapons, this is actually going to help pay for purchasing land and constructing buildings and supplying machinery and parts for munitions plants. So we’re actually, instead of simply having a little bit of money to pay for the weapons that have been used, we’re actually going to help these private corporations expand their operations in the United States. Well, I assume in the United States, but I would have to look into that. Expand their operations in order to build these munition later. But going from 13 million to 500 million is quite a jump.

Steve Ellis:

It’s Nuts. I mean, the idea that we’re, one, going to be taking on these capital expenses for what is a hopefully short term need, the war in Ukraine, instead of dipping into our supplies and relying on that or even pushing the defense contractors to produce more of this ammunition. It just seems to me crazy that we’re going to make these capital expenses for temporary needs. It’s not like the defense industry is hurting for cash and some of these are the most lucrative businesses in the world.

Josh Sewell:

Yeah. But again, when disasters strike get while the getting is good.

Steve Ellis:

Yeah, because it’s slipped in and nobody even saw the CR until this morning and it’s got to pass by Friday midnight.

Steve Ellis:

You’re listening to Budget Watch Dog All Federal, the podcast dedicated to making sense of the budget spending and tax issues facing the nation. I’m your host TCS President Steve Ellis. We continue now with Autumn Hanna, and Josh Sewell with a turn towards how we got here this time.

Steve Ellis:

So Autumn, it sure looks like the side deal that Senate Majority Leader Schumer and Senator Joe Mansion cut to pass the Inflation Reduction Act, that reconciliation bill that Josh was referring to, is what is now causing the threat of a government shutdown. Bring us all up to speed on that.

Autumn Hanna:

As Josh said, there can be anomalies and emergency spending, but sometimes policy bills can catch a ride on a CR. This year we’ve seen that on full display with efforts to add a permitting bill to the CR. So it’s an energy permitting bill, and this all started as part of a deal for Senator Mansion to pass the Inflation Reduction Act.

Josh Sewell:

Yeah. And as a reminder, the reason you are dealing with this policy bill right now is because you can’t actually legislate on that reconciliation bill. It has to in reconciliation, again, we have a whole podcast on this and we have some stuff on our website if you want to read into it, is you actually have to deal with dollars and cents or with the budget. And so you can’t actually make these major policy changes. It would not have passed muster with the parliamentarian and it may not have pass muster with the other senators.

Autumn Hanna:

Right. So Senator Mansion wanted these energy permitting changes. They were really high priority for him. And so as part of the negotiations, he brokered a deal with Senator Schumer to move permitting reform separately from the IRA and Senator Schumer agreed. And so now Senator Schumer and Senator Mansion have been working hard to get permitting reform as part of this CR deal.

Autumn Hanna:

This has led to all kinds of trouble for both Republicans who don’t think Senator Mansion’s proposal goes far enough and don’t want to give him anymore wins in his column and for Democrats who think it gets environmental reviews. And I think so you’ve got the politics and the policy butting heads. You’ve got both sides of the aisle bickering. It’s just not looking good for this to be added.

Autumn Hanna:

And for TCS adding provisions like permitting reform really should be done through regular order, not as late addition to a must pass bill to keep the government opening. We don’t want to see these kind of add-ons. These muddy the waters when you want regular order appropriations, all kinds of layers of problems here. And we think that have nothing to do with frankly the substance of the issue and agree that Congress should be looking at permitting reform, but attaching it to a CR is just bad process.

Steve Ellis:

Yeah, in the spirit of a football season we’ll throw a flag at that. The thing is adding one thing leads to another thing and so on and so on. And it kind of really gums up the works, especially when you’ve got a deadline coming at the end of this week.

Autumn Hanna:

Right. And at this late stage we can push into government shutdown territory for taxpayers. And that’s really the big threat here. The costs of shutdowns are real.

Steve Ellis:

Okay. So what’s the scuttlebutt? How long does it look like government will be operating under the CR?

Josh Sewell:

Through December 16th in the current bill, but that’s assuming this language doesn’t change between now and Friday.

Steve Ellis:

So possibly they could do a short term CR. If they’re really backs against the wall, they could do a short term CR into just next week and then come back to this, Right?

Josh Sewell:

Yeah, or we could revive those one day CRS and they could pump them out every day until they get it done. That’d be fun.

Steve Ellis:

We’ve kind of touched on this a little bit. I mean as bad as CRS are the alternative as Autumn Remind just reminded us is a government shutdown, which is worse. But actually that’s not the only alternative Congress. Could do their job. It’s not like they don’t know that deadline is coming every single year. But like slacker college students with a term paper, they wait until the last minute. And you know what, listeners, they’ll do the same thing when this CR comes to an end in December 16th.

Steve Ellis:

So there you have it, listeners. The outsized impact inaction takes when Congress kicks the can down the road with a continuing resolution. Congress needs to resolve to do better. This is the frequency. Mark it on your dial. Subscribe and share. And know this, taxpayers for Common Sense has your back America. We read the bills, monitor the earmarks, and highlight those wasteful programs that poorly spend our money in shift long term risk to taxpayers.

Steve Ellis:

We’ll be back with a new episode. And I hope you’ll meet us right here.