Policy

Black Predicts Markup of FY 2018 Budget Next Week in House

‘If we can’t find a way to cut one penny on a dollar, shame on us’

Chairwoman Diane Black, R-Tenn., and ranking member John Yarmuth, D-Ky., listen to testimony by OMB Director Mick Mulvaney during a House Budget Committee hearing in Longworth Building titled "The President's FY2018 Budget" on May 24, 2017. (Tom Williams/CQ Roll Call)

The House Budget Committee may mark up its fiscal 2018 budget resolution next week, according to Chairwoman Diane Black.

The Tennessee Republican told the Rotary Club in Jackson, Tenn., on Wednesday that she’s “hoping we’re going to bring [it] up this upcoming week, when we get back and pass it out of our committee.”

Such a markup, if it does proceed, would represent a significant step forward for the House Republican Conference’s budget process, which has been deadlocked for weeks.

The vast majority of the House GOP has signed on to spending levels of $511 billion for nondefense discretionary spending and $621.5 billion for defense discretionary spending during fiscal 2018. But discord still exists over how much to reduce mandatory spending and how to set up an overhaul of the nation’s tax code through the budget reconciliation process.

Black said on Wednesday, in a video that was posted on Facebook by The Jackson Sun, that she expects the resolution will cut 1 percent of mandatory spending during the 10-year budget window.

“We want a 1 percent cut in mandatory spending,” she said. “Guys, it’s one penny on a dollar. One penny on a dollar. And if we can’t find a way to cut one penny on a dollar, shame on us. And that is where the biggest fight is right now — between the one side and the other side.”

The more conservative elements of the House Republican Conference, including the Freedom Caucus, have been pushing for hundreds of billions in spending cuts as part of the budget resolution. But more moderate members are concerned about where those cuts would come from. Debate ranges between $150 billion and $700 billion.

Jim Jordan and I have identified over $700 billion in mandatory spending cuts that we could find,” Freedom Caucus Chairman Mark Meadows, R-N.C., said last week, referring to another Republican House member, from Ohio.

The 1 percent mandatory spending cut Black spoke about would represent a $339 billion cut over the next 10 years, when the Congressional Budget Office’s projected mandatory outlay of $33.9 trillion for 2018 to 2027 is used.

Veterans’ benefits

But where exactly those mandatory cuts would come from remains murky.

Black said the budget resolution would not change any elements of Medicare, because President Donald Trump campaigned that he would not touch the health care program. It will also not affect Social Security, because that program cannot be altered via reconciliation.

“But there are 12 other areas within our normal services that are mandatory spending,” Black said. “Just to give you an example, the veterans have a lot of mandatory spending on their programs.”

Black told the audience that there is a provision that allows single veterans, who are receiving educational benefits, to receive a housing allowance for a married couple — instead of a housing allowance for a single person.

“Why would you get a housing allowance for a married couple, if you are a single person?” she asked. “If we look at that and reforming that for the future — and it should be reformed — it saves billions of dollars. I think that’s an easy one. I think we can all agree, if you are a single person you get a single housing allowance.”

A Budget Committee aide said a monthly housing allowance is paid to individuals attending post secondary institutions. Under the law, beneficiaries without dependents are paid at the same rate as those with dependents, the aide said.

Black went on to tell the Rotary that every committee should be able to find somewhere it can reduce spending.

As far as how the nation’s tax code would be restructured through the budget reconciliation process, Black said it would reduce the number of brackets for individual filers from seven to three, allow individuals to file on a post card, make the IRS more consumer friendly and reduce the corporate tax rate. She expressed skepticism, though, that the top rate for corporations would decline from 35 percent to 15 percent.

“On the corporate side, we’d like to get down to 15 percent. Guys, I don’t know that we can get there. I think we can get to 20,” Black said.

Despite the broad list of challenges facing the budget and the following reconciliation process, Black expressed optimism that the conservative and moderate factions are on board with the budget resolution.

“We’ve spent four months doing our work and we think we’re finally to a sweet spot, because I have people all the way from the extreme right to the more moderate New York, Washington State, and it really is a very large difference between those two groups.”

Paul Krawzak contributed to this report.

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