A Fiscal Conservative Backlash?

Posted January 26, 2004 at 6:11pm

They’re mad as hell and they’re not going to take it anymore.

That’s the message Republican fiscal conservatives will be sending to their leadership teams in both the House and Senate this week as the annual federal budget process begins to kick into high gear.

With the federal deficit projected to grow to more than $500 billion in this all-important presidential election year, Congressional Republicans are finally getting sensitive about the “tax cut and spend” label that Democrats have been hurling at them.

Conservatives say they are willing to suffer whatever retributive repercussions Republican leaders threaten them with. So the notion that any budget can find a consensus in this closely divided Congress seems highly dubious.

“I’m not too optimistic that we’ll be able to, in this environment, find a compromise piece of legislation,” noted one senior Senate GOP aide of the upcoming budget debate, which will get its official kickoff next Monday when President Bush makes the opening bid with his budget proposal.

The chips seem stacked against GOP leaders’ push this year to pass a budget resolution that keeps fast to Bush’s plans to hold “non-defense, non-homeland security” discretionary funding to 1 percent or less, while cutting the deficit in half over the next five years as well as making the $1.3 billion tax cut passed in 2001 permanent.

“If you’re going to try to balance the budget on non-defense, non-homeland security discretionary funding, the numbers just don’t add up,” said House Appropriations Committee spokesman John Scofield. “Discretionary spending is just a third of the budget, and over half of that is defense.”

The Senate GOP aide agreed: “The increases in spending have been defense out the wazoo.”

Scofield added that appropriators have been much maligned for federal spending allegedly being out of control, but they “get no credit for living within the budget resolution.” Despite its eye-popping $820 billion price tag, the fiscal 2004 omnibus spending bill did not exceed the funds permitted in the fiscal 2004 budget resolution. Go figure.

“In the macro, it’s easy to talk tough on spending, but the devil is in the details,” said Scofield.

So just what do House conservatives plan on doing to make sure their plan for cutting federal spending wins the day?

“To have any leverage to try to hold down the spending, we’ve got to have 15 to 20 Members who will go to the leadership,” said Rep. Walter Jones Jr. (N.C.), a member of the lead conservative group in the House, the Republican Study Committee. “If [conservatives] come back with 15 to 18 that will cut their wrists on certain votes, then [Rep.] Sue Myrick [R-N.C.], as our chairman, can go to the leadership and say we’re serious.”

Indeed, it appears that’s what Myrick may do this week. During the Republican Study Committee’s retreat last week in Cambridge, Md., conservatives decided on a plan of action, the exact details of which they’re holding close to their vests while they wait for Myrick to formally notify House Speaker Dennis Hastert (R-Ill.) and House Majority Leader Tom DeLay (R-Texas) of their plans.

Of course, assuming Hastert and DeLay listen to the North Carolinian and her 90-plus Members (which seems likely given their numbers), Myrick and Jones will probably have to tighten their belts as well. That could mean not only a scarcity of Myrick press releases touting $4.6 million for roads in her district or $8.5 million for a new courthouse in Charlotte, but also fewer Jones missives asking the president to not cut funding for veterans’ prescription drugs.

But luckily for the RSC lawmakers, GOP leaders in both chambers appear to have already gotten the message.

“The deficit is in vogue again” as an issue, the senior Senate GOP aide noted. “I think there clearly is some momentum that is starting to take hold for those of us who always believed deficits do matter.”

In the Senate, plans are already under way to try to restore some order to the process, by re-enacting budget mechanisms that have expired. But there are other problems besides budget rules to consider.

Despite their acknowledged commitment to bring the federal deficit down, most conservatives still want to see a fiscal 2005 budget resolution that could put Congress on the path to making all of Bush’s tax cuts permanent — a prospect that could drive projected deficits into the $1 trillion range if the economy does not rebound strongly.

Although separate legislation would be necessary to actually enact tax cuts that stretch beyond the reach of the 10-year budget estimates in the budget resolution, several Congressional budget experts acknowledged that trying to account for the permanency of the tax cuts in this year’s budget resolution would likely kill the measure in the Senate, at the very least, and possibly in the House as well.

That’s because moderate Republicans in both chambers have been loathe to add to the federal deficit by further reducing the amount of money coming into the federal treasury.

As fiscal conservative Sen. Wayne Allard (R-Colo.) — who will likely be the future chairman of the Senate Budget Committee — noted, “In the past, it’s been difficult for conservatives to hold the line [in the Senate], because alliances are more often forged between moderate Republicans and Democrats.”

Indeed, in 2003, moderates Republican Sens. George Voinovich (Ohio) and Olympia Snowe (Maine) successfully blocked their leadership from moving Bush’s proposed $726 billion tax plan, forcing the entire Congress to take a smaller $350 billion package.

If the House and Senate can’t agree on a budget, there is one saving grace for all involved: Last year’s budget resolution! Remarkably, last year’s budget set discretionary spending levels for fiscal 2005 as well as 2004.

In fact, conservatives might even be able to claim victory if Congress simply fell back on last year’s budget, because it would hold overall increases in discretionary spending to Bush’s 4 percent target, according to the senior Senate GOP aide.

Allard is already pushing to hold fast to some pieces of last year’s budget. Although he’s willing to look at Bush’s five-year plan to halve the deficit, he already has a preference for the 10-year deficit reduction plan included in the Senate’s fiscal 2004 budget resolution.

But perhaps we’re getting ahead of ourselves. Before the budget fight even makes it to the House and Senate floors, the mammoth highway funding bill is slated to wend its way through the chambers, and many conservatives see that measure — which would defy budget caps set last year — as a crucial first test of their resolve to cut spending.

Given the penchant many Members, even Myrick, have for touting their district’s highway allocations, the outlook may not be rosy.

“Fiscal conservatives will lose the transportation bill because too many people like their increases,” predicted Sen. John Ensign (R-Nev.), whose chamber is scheduled to debate the bill starting next Monday.

But Ensign said the real test of whether federal spending, either in the highway bill or elsewhere, will be curtailed begins and ends with Bush.

“It’s not only what he proposes in his budget. It’s also how strongly he’s involved throughout the year,” said Ensign. “Will he veto the transportation bill if it needs to be?”