Republicans brace for budget debate

The unity of the new Republican Congress will be put to the test this week as leaders in the House and Senate unveil budget blueprints that are expected to slash trillions of dollars from federal spending.

Republicans on the House Budget Committee will release their budget blueprint on Tuesday morning, followed by their Senate counterparts on Wednesday.

The release of the two budgets will be the starting pistol for a frenzied lap of legislative work, with GOP leaders aiming to move budget resolutions through both chambers of Congress before the Easter recess.

{mosads}Thanks to their new majorities, Republican budget leaders are under enormous pressure to pass a fiscally conservative resolution that balances the books, perhaps within a decade.

But they are also facing a counter push from defense hawks who say increasing military spending is a national security imperative that cannot be ignored.

If the divide on sequestration weren’t enough, Republicans are also debating how to use reconciliation — an obscure budget tool that can be used to usher through major policy changes with a majority vote in the Senate.

Should budget resolutions pass both chambers, Republicans intend to form a conference committee to produce a final budget agreement that would set spending guidelines for later this year.

But before they reach the final negotiating stage, Republicans will have to navigate several delicate questions.

How to address sequestration?

Spending cuts under sequestration will return in October unless Congress takes action.

While Republicans can’t technically change the sequester through the budget, the question of what to do about it has become a flashpoint in the party, with fiscal hawks applauding the cuts as necessary and defense hawks demanding their reversal.

Senate Budget Committee Chairman Mike Enzi (R-Wyo.) has hinted at maintaining sequestration levels in his blueprint, something Sen. John McCain (R-Ariz.), chairman of the Senate Armed Services Committee, has vowed to oppose.

On Monday, McCain urged Congress to restore the Pentagon’s budget next year to $577 billion, the level that was planned before spending limits were enacted in 2011.

House Armed Services Committee Chairman Mac Thornberry (R-Texas) on Monday said he has pressed House Budget Committee Chairman Tom Price (R-Ga.) about the Defense spending level in the House’s blueprint.

“In no event do I believe we should be lower than $566 [billion], which is what last year’s budget resolution said we were going to spend this year,” Thornberry said.

Last week, McCain said he would vote against the GOP budget if it didn’t adjust sequester levels. Sen. Lindsey Graham (R-S.C.), who is mulling a run for the White House, said he wouldn’t vote for the blueprint if it didn’t propose sequester changes or include a reserve fund that would open the door to future negotiations.   

How many years to balance?

Both budgets are expected to bring the federal budget into balance. But how long it will take remains an open question.

The timeline is crucial, as it has a major impact on the size of cuts that are necessary.

Some House Republicans on the Budget Committee have indicated their blueprint would balance in less than 10 years, which would be sooner than proposals from former Budget Committee Chairman Paul Ryan (R-Wis.).

Many conservatives had scoffed at Ryan for proposing to balance the budget in 10 years, arguing a shorter window was needed.

Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, told the Senate Budget Committee last week it would take $5.5 trillion to balance the budget within a decade. The liberal-leaning Center for Budget and Policy Priorities estimated it would take $4.5 trillion in cuts.

Sen. Bob Corker (R-Tenn.) last week suggested the upper chamber’s budget resolution would balance in at least 10 years.

“There’s probably no one in the caucus who would want it to be less than [10 years],” he said. “I hate to say this, as someone who would like to do it in two. … Even 10 years is a heavy lift, but something we all known at a minimum has to occur.”

Where to use reconciliation?

Republicans have for months debated how to use the reconciliation tool, whether for unraveling parts of ObamaCare, overhauling energy policy, reforming the tax code or even raising the debt ceiling.

Democrats used reconciliation to pass ObamaCare in 2009, and some conservatives want to use the same tactic to dismantle it.

One wild card is the Supreme Court case King v. Burwell, which could strip healthcare subsidies from people in 37 states.

The ruling in that case isn’t expected until the end of June, which could force Republicans to issue reconciliation instructions just in case the law is left intact.  

At least one of the budget resolutions must include reconciliation instructions if Republicans want to use the tool later on, but the initial details won’t actually start the process.

Reconciliation will only be triggered if the House and Senate agree on a joint budget resolution, and the instructions included in that final document direct specific committees to develop spending plans and policies.