Members outraged over flexibility of pay-go rules

House budget hawks on both sides of the aisle are crying foul over an overload of “emergency” bills not subject to the lower chamber’s pay-as-you-go budgetary rules.

Democratic leaders last week declared emphatically that they are still committed to abiding by rules dictating that any new discretionary spending or tax cuts be offset so as not to add to the deficit.

{mosads}“We’re absolutely committed to pay-go,” House Majority Leader Steny Hoyer (D-Md.) told reporters last week. “The Speaker is committed to pay-go. I’m very committed to pay-go. Our caucus is committed to pay-go.”

At the same press conference on Wednesday, Hoyer identified a number of pieces of legislation that are high-enough priorities — some of which may be included in the emergency war spending bill — that could be viewed as exceptions.

Along with an extension of renewable energy tax credits, which Hoyer admitted “causes a pay-go problem,” the majority leader said that an extension of unemployment insurance benefits, a new GI bill expanding benefits to war veterans and a housing bill are all Democratic priorities and opened the door for any of those measures to also be tacked on.

None of those bills are likely to be paid for.

An extension of unemployment insurance would fall into the category of economic stimulus, Hoyer said. Financial Services Committee Chairman Barney Frank’s (D-Mass.) housing bill, which would allow the Federal Housing Administration to insure some $300 billion in shaky home loans, is being called an emergency bill.

And legislation to revamp the GI bill is unlikely to have its $52 billion cost offset.

As a result, some Democrats are having fits with what they see as an unjustified end-run around pay-go.

“We’re completely overacting,” said Rep. Jim Cooper, a Blue Dog from Tennessee and a senior Democrat on the Budget Committee. “Everything’s an emergency. And an emergency’s a perfect lobbying excuse to get your bill passed that you couldn’t get through in regular order.

Cooper, who was one of 10 Democrats who in January voted against the $168 billion economic stimulus package that was financed through deficit spending, said he sees similar writing on the wall now.

“If you add up all the bills, there are probably 100 that are pay-go-compliant and four or five that aren’t,” said Cooper. “But with every exception it reduces its force. Pretty soon pay-go will have so many loopholes that there won’t be any pay-go left.”

For their part, Republicans also seem to be split on whether waiving pay-go rules for emergency and economic stimulus bills is appropriate or not.

Republican Whip Roy Blunt (Mo.) suggested to Hoyer on the House floor last week that shelving pay-go rules for bills that fall under the category of economic stimulus should not stop at unemployment insurance or another round of tax rebate checks. He cited expired research and development credits, expired deductibility of sales tax from income tax or the Alternative Minimum Tax as also meeting that criterion.

But Rep. Paul Ryan (Wis.), the ranking Republican on the Budget Committee, disagreed with Blunt on such an open-door pay-go policy.

“For all practical purposes pay-go is dead,” Ryan said. “And what we’re really seeing is not just a sweeping under the rug of the Democrats’ own rules, but a laundry list of bills that are called stimulus or emergency.”

Ryan said Congress is using the economic downturn as an excuse.

“I think that at the end of this downturn what we’re going to end up with [is] a broken budgeting process that has no confidence,” he said. “And you’ll see what is already a dysfunctional budget process — and both parties screwed it up — become emasculated. And it’ll take both parties to put this back together to have any ounce of integrity whatsoever.”