Congress has left town for the year but alas not before another bipartisan spending party that has typified the
Presidency. The numbers deserve notice because they are likely to have more long-term impact than impeachment.
Lawmakers whooped through $1.4 trillion in discretionary spending for the rest of the fiscal year with little debate or objection. A bipartisan deal on the budget outlines in August was supposed to give Congress time to negotiate 12 individual spending bills, but as usual they couldn’t agree so they piled it all into two bills totalling more than 2,300 pages on Monday. A day later they added a list of tax subsidies, and by Friday it was law. Congress can act fast when it is greasing its own wheels.
The political secret to this bipartisan blowout is that the Republicans get more for defense in return for giving Democrats more for social welfare. An $860 billion national security bill gave President Trump $1.375 billion for his border wall—despite Democratic vows that he’d get none—and modest flexibility in where the wall can be built. The White House also won $738 billion for defense, $22 billion more than last year, and funding to create Mr. Trump’s Space Force.
Democrats cashed in with $555 billion for domestic priorities. They scored $25 million for “gun violence research,” $425 million in election security grants, and more money for Head Start and early childhood education. They increased funding for the Environmental Protection Agency and Medicaid for Puerto Rico.
Farm state Members added $1.5 billion in disaster relief, on top of the $3 billion Congress passed earlier this year. GOP Senator
delivered a big tax break for Iowa’s biodiesel blenders, and the tax bill also showers largesse on distilleries, race-horse and Nascar owners, short-line railroads, and renewable energy. In return, Republican tax writers were able to pass a small list of “corrections” to their 2017 tax reform.
The only good tax news was agreement to repeal, permanently, three tax increases that Democrats had passed to make the phony ObamaCare numbers look real in 2010. Democrats were keen to repeal the so-called Cadillac tax on high-cost health plans. Unions have negotiated rich benefits and don’t want to be taxed on them. Republicans in turn were able to repeal permanently the taxes on medical devices and health insurance.
The Export-Import Bank was reauthorized for seven years, while the egregious federal flood insurance program was extended again through September without reform. West Virginia Senator
landed his bill requiring taxpayers to underwrite the pensions and health care of retired coal miners.
was able to protect Alaskan salmon from competition. Speaker
included an earmark for the Presidio Trust, which maintains a San Francisco park. Senate Majority Leader Mitch McConnell raised the minimum age to buy tobacco to 21.
The Club for Growth notes that the bills increase discretionary outlays by more than $175 billion over last year, and budget watchdogs estimate the higher spending caps Congress agreed to this summer will add $1.7 trillion to the national debt over 10 years. Debt held by the public as a share of GDP is close to 80% and rising, 10 years into an economic expansion.
The budget problem isn’t a shortage of revenue. CBO says tax receipts grew 4% last fiscal year, through September, and 3% in the first two months this year. Economic growth is feeding the Treasury. But spending is growing much faster: 8% last fiscal year, more than four times the inflation rate, and 6% in October and November this year.
In addition to the latest discretionary bills, spending on Social Security (6%), Medicare (6.1%) and Medicaid (9.2%) continue to soar this year. Neither party shows any inclination to do anything about those programs, except expand them. Mr. Trump may yet join
in the spending record books.
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