TOPICS > Politics

Congress Passes Federal Spending Bill and Raises Debt Ceiling

November 22, 2004 at 12:00 AM EDT


JEFFREY BROWN: One of the duties of lawmakers is to pass legislation to fund the workings of the federal government.

This year they waited until the last minute to do so, and wrapped everything up into one giant spending bill of $388 billion.

The thousand-page, fourteen-inch thick bill has provisions for everything from $35 billion for highway construction to $100 million for future flu vaccine development, to $2 million to buy a former presidential yacht for a Navy museum.

But it also limited or cut spending in many areas, and contained several last-minute wrinkles that surprised many lawmakers.

Back to walk us through all this is Norman Ornstein of the American Enterprise Institute.

Norm, welcome back. First, let’s’ talk about what this money is actually used for.

It’s non-defense, mostly domestic spending?

NORMAN ORNSTEIN: We have a number of categories in the budget.

There are the entitlement programs, Social Security, Medicare, Medicaid and the like that are not included in this.

They’re on automatic formulas. The rest is discretionary spending that can be changed from year to year.

And the different categories include defense, homeland security, foreign aid and all of these domestic programs. Defense is not included in this bill.

They managed to deal with that before the deadlines. We actually didn’t wait until the last minute here.

We are already well over a month into the new fiscal year. What we have is that slice of spending that is basically discretionary domestic spending.

This bill was $388 billion and that’s roughly a seventh of all the federal budget.

JEFFREY BROWN: So why does it happen that way? I said it was late. And why does it all get wrapped up into one big bill?

NORMAN ORNSTEIN: This has become now the way of life on Capitol Hill for a very long time. It’s partly because there is so much here that goes beyond simple spending.

It’s priorities, it’s basic decisions about what government does or doesn’t do and it’s a lot of politics. Much of it ends up being push pushed to an end game where you get leverage right at the end.

The fiscal year began Oct. 1. This Congress, the last two years, was not able to do a basic budget, which they were supposed to do early in the year, around April to set the overall categories.

Unable to do that they were unable and unwilling to do the specifics until it was very late in the game — some of this, of course, with an election coming up, if you begin to cut back in some areas, it could hurt you a little bit.

And they also didn’t want to get to a point where it looked like they were spending too much and getting into profligacy.

So they put it off until afterwards and now have to get it done because otherwise basically you can bring government to a halt, something we’ve seen happen once or twice before.

JEFFREY BROWN: Now part of the context here, the backdrop, is the continuing budget deficits, the need to hold down spending. So what role did that play in the negotiations this time?

NORMAN ORNSTEIN: This time around the white House weighed in and Republican congressional leaders did.

They wanted to show in some fashion that they were being tight with taxpayers’ dollars as budget deficits have obviously gone up very substantially over the last few years.

They don’t have much control directly year to year over a lot of the spending.

They’re not going to cut back defense and of course left in the backdrop here was we’ve got another $70 billion bill coming due as soon as they get back in January for Iraq with more to follow.

This is the one area where they could begin to show some fiscal discipline.What we have in this bill is overall spending for this catch all of a different items that, you know, includes things like the agriculture bill, the parks and so on was limited to a 1 percent increase.

Then on top of that, they passed an overall across the board cut of about three quarters of a percent, so basically keeping it almost flat and then declaring victory.

But of course it’s never as simple as that.

JEFFREY BROWN: It is a very big bill. Can you point to any clear winners or losers?

NORMAN ORNSTEIN: Sure. And there are specific areas where we actually saw, despite the tightness of the budget, substantial increases and other areas that took very significant hits.

One that took a major hit was community policing. This of course was a program that had been a favorite of President Clinton’s to add a large number of police to the streets.

That one was virtually wiped out in this budget.

The president took a hit in a program in foreign aid that had been a favorite of his, a millennium challenge proposal that gives a lot of aid to the poorest countries.

That one was cut back significantly from what the president wanted but then there were some other areas that did very well.

Federal employees got a significant pay increase, which was actually a bit of a surprise.

We also saw a significant increase beyond what the White House wanted on veterans health and no surprise water projects which are individual, sometimes called pork barrel spending, did very well in this bill despite the presumed discipline.

JEFFREY BROWN: Speaking of surprises, I said there were some surprises and some controversies at the end.

One of them that stirred the pot quite a bit was a provision that allowed some members of Congress to look at individual tax returns. What is that about?

NORMAN ORNSTEIN: In an overall way, Jeff, keep in mind, that while this is about spending, you can do all kinds of things here that are real policy changes.

And the temptation in a bill that is a thousand pages and 14 inches, all kinds of fine print that members don’t read before they get it, is to throw in some things or even take out some things that make major policy. In this case, something that no one admits to authoring would have….

JEFFREY BROWN: We don’t know where it came from?

NORMAN ORNSTEIN: We’re not sure where it came from, but it would have given the chairman of the Appropriations Committees in each House or his designate, the power to look at individual or corporate tax returns and even to make them public; something which is against the law but is a power of course that now is being disavowed by everybody.

Because it was in right at the end though, they had to go through all kinds of contortions to find a way to take it out.

JEFFREY BROWN: Another perhaps with a longer life, a controversy involved abortion language.

NORMAN ORNSTEIN: But the House Republicans social conservatives added a provision to this bill that basically makes it easier for hospitals and health providers getting federal funds to deny abortion or family planning assistance.

This was not part of the consensus. It was not added in the normal legislative process.

It caused howls of outrage among pro-choice senators, some of whom threatened to filibuster the bill and basically bring the government to a halt.

In the end, because this was a take it or leave it process, they settled on the fig leaf in effect where they will get a separate vote on this provision next year and it will probably be taken up in the Senate but kept it in the House.

This was, in a sense, post-election social conservatives say we can won, now we are going to get some things.

JEFFREY BROWN: Well, that’s the other context that I wanted to ask you about, of course, is post-election politics. Congress comes back later on and it will be a larger majority for the Republicans. But did you see any of that impact immediately?

NORMAN ORNSTEIN: We do see this because the context after the election where we knew they were going to have to do a lame-duck session to deal with this issue and they hope to deal also with the intelligence question, had the Republicans lost seats in Congress knowing the legislative climate would be less favorable in January, they would have been tempted to do a lot more.

As it was, they came back a little bit heady, feeling that they could add a few things and get them through right now but this became more of a bare bones process.Now they dealt with this.

They also did an increase in the debt limit, which is also tied to this concern about deficits but in a statutory way, something that they’ve held off doing until after the election and then did it right up front, but basically a lot of other legislative priorities have been left hanging.

And now what we have seen is really a process where Republicans feeling very good about themselves, manage to get through this year with minimal damage but now find because of a couple of these controversies, that they’ve still got some cleanup work to do before they adjourn for January.

JEFFREY BROWN: Okay. And then much more to come in January.

NORMAN ORNSTEIN: A lot more, and more still in December.

JEFFREY BROWN: Okay. Norm Ornstein, thanks again.