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Why the Omnibus Passed (and the Real Problem)
I HATE omnibus appropriations and continuing resolutions.
But as much as I hate them, there were good reasons that this nasty, crap-sandwich 2023 omnibus passed. Not reasons that I like, but reasons nonetheless. Let’s take a dispassionate look at why.
First, the bill couldn’t be passed without at least ten Republican senators voting for it because it had to overcome the filibuster hurdle of 60 senators voting yes. Mitch McConnell (curses upon him) and a group of senators are mostly interested in the Republican party as a vehicle for power. Sometimes that works to our advantage when he stops Merrick Garland’s nomination. But sometimes it means that we get crap sandwiches. He’s not really interested in the Constitution or thinking about the future of the republic. Thus Mitch used his power to push the omnibus through.
In this specific case, Mitch was worried that the House Republicans would be unable to put together a majority to pass appropriations bills early in the 2023 session. If just five House members defected, there would be only 217 votes in favor, while 218 are required for a majority. He reasonably assumed that a Republican appropriation for 2023 would not get a majority. The House Republican leadership (whether McCarthy as Speaker or someone else) would then have to buy off enough Democrats to get a majority or shut down the government. He felt both options were unpalatable and would lead to worse outcomes than the omnibus.
While I wouldn’t mind if we shut down the federal government, even for a long time, it really isn’t a solution to governance. It doesn’t solve the major fiscal problems that we have, so eventually the shutdown has to end, probably by buying off Democrats to vote for a crap sandwich omnibus of some kind.
Second, the omnibus did fund the military. Genuine fiscal conservatives such as Tom Cotton, who is a defense hawk, voted for the omnibus on this basis.
Third, there were undoubtedly goodies handed out to some Republican senators to buy their votes.
And thus a full-year crap sandwich passed instead of another short-term continuing resolution that would kick the can into the new year where Republicans would have more power.
But there is a much bigger problem. The current system has never worked. The system is supposed to work as follows: the president submits a budget by the first Monday in February, but most presidential budgets are late. Biden’s FY 2023 budget was submitted on March 28. Congress must pass a non-binding guideline budget resolution by April 15, but it’s usually late or never happens at all. Then 12 appropriations committees in each of the Senate and House must pass binding appropriations bills by the start of the fiscal year on October 1. These appropriations bills are what actually give the government money to spend.
Since the start of the current system in 1977, only four, yes FOUR, times have all the appropriations bills been passed (1977, 1989, 1995, and 1997). It’s been 28 years since Congress passed all the appropriations bills. In 6 of those 28 years since 1995, only the defense appropriation act was passed. Since 1997, 19 years have seen NO appropriations bills passed. And most of the time, even those that were passed came after the October 1 deadline. Year after year, we’ve been getting continuing resolutions and omnibus bills. It’s not just FY 2023 that has been the problem. It’s not just the Biden administration, or the Trump administration, or Nancy Pelosi, or Chuck Schumer. It’s every year, and it’s been that way for a long time.
I’m sure there are things that could be done to improve the system, tweaks that could be made. But I submit that the problem is that the federal government has grown beyond the ability of even the most sincere, hard-working, fiscally responsible president and congress to control. And of course, we rarely if ever have a sincere, hard-working, fiscally responsible majority in Congress.
Until there is an intervention, until someone cuts the drunken sailors running our country off from their liquor, it’s not going to stop. I hope we can get a fiscally responsible majority in Congress to do the intervention before it’s too late. A Congress that would take an axe to federal spending and the federal bureaucracy. But if Congress doesn’t, the markets will eventually lock the liquor cabinet up by refusing to buy US government bonds. And that day will be a catastrophe.
I’m betting on the catastrophe.
Published in Economics
Steve, this was a brilliant article. Thank you for taking the time to do the research and to write it so carefully.
The capper was this statement of the political root cause. It is one that too many confident recommenders of useless band-aids miss completely. They miss it because their tunnel vision makes them see symptoms of a disease as the source of the disease.
This is criminal.
Managing the federal budget is Congress’s job. It’s difficult, intentionally so, to make it more difficult for congressmen to use taxpayer money to buy elections.
So they just skip all that and spend whatever they want. Every year.
And here we are. With a national debt that is greater than the combined wealth of every person, corporation, and government on this earth.
So how do we pay THAT off?
We don’t, obviously.
So how does this ride end, exactly?
I don’t know. But I think it’s likely to be horrifying…
Excellent post. However, I would suggest that even this is a problem. Why should the executive branch get the first crack at the budget? It’s the House’s responsibility to spend money (with Senate agreement) and the president’s job to administer. The presidential prerogative of submitting budgets feeds the conceit of a monarchial presidency. The president should be shut out of this process (at least in a formal sense) until there is a bill on his desk passed by both houses of Congress.
Excellent point.
I don’t think there is anything in the Constitutional process about the Executive submitting a budget to Congress. Congress abdicated their responsibility of controlling the nation’s purse in 1974. In 1974, Congress passed the Budget Control Act to ‘streamline’ the process for passing the federal budget. Its the BCA that asks the president to submit his budget proposal to Congress. What they really wanted was to avoid responsibility and the Executive was all too happy to accept this grant of power.
Thanks for clarifying my comment. I was generally aware of a statute calling for a presidential budget, but you caught the gist of my point–constitutionally, the president has no obligation to submit a budget, and prudentially, it’s unwise for him to be expected to do so. Congress would rather someone else do the hard work though.
I recall when Senator Kent Conrad actually opened a Budget Committee hearing (he was the chairman) and Harry Reid instantly ordered it shut down. Regular order was no longer the process.
“Continuing resolutions” or “omnibus” bills prevent debate or focus on controversial provisions and make the federal budget ongoing and eternal. Members can add various crapola and pork with amendments but the body of the beast gets inertia and becomes invulnerable to oversight by elected reps. Congress is like a dung beetle rolling a big ball of manure and inserting its (eggs) various wishes inside.
The media and special interest pressure brought to bear if this crapfest is not approved and the federal government pretends to shut down is squarely against anybody seeking fiscal restraint or removal of partisan garbage from the package. It is a rigged game.
I seem to recall that during the years that Paul Ryan* was Speaker of the House, the House of Representatives did pass budgets, but the Senate couldn’t get its act together.
*(Yes, yes, I know, we must all hate Paul Ryan for saying something mean about Donald Trump or something.)
The president has no constitutional obligation to submit a budget, but the 1974 budget law does require him to do so, so he has a statutory obligation to submit one. But his budget is only a proposal, so he is not authorizing the spending of any money. So it’s not a violation of the Constitution. In fact, Congress usually ignores his budget proposal, so there’s really no point to the president preparing one.
Agree with all this. I just think the 1975 law is imprudent and that it improperly asks the president to drive the budget. In other words, it’s constitutional, but unwise.
Here’s another chart to show that even from the beginning in 1977, the current system didn’t work.
By law Congress must produce a budget resolution by April 15 each year for the fiscal year starting on September 30. The budget resolution is non-binding, but it is important because any member can object if an appropriation later on exceeds that line in the budget. Each house then has to override the objection for the appropriation to be allowed to exceed the budget. So the congressional budget should be a good control device.
But the congressional budget is almost always late. In 47 years, it’s only been on time in 4 years. Even in the early years, it was always late; and in recent years, it has been getting much worse as you can see from the following graph.
The graph shows the number of days the congressional budget was late. The budget is due on April 15, which is 168 days before the fiscal year starts on October 1. So if the budget is more than 168 days late, it wasn’t ready by the time the fiscal year started. So there was no guideline for the appropriations committees to know how much money they could give each agency. In fact, any days that the budget is late gives the appropriations committees less time to do their complex work. In some years, no budget was approved at all, and those are the longest bars since I used Sept 30, the last day of the fiscal year if no budget was approved.
Source: “Deeming Resolutions: Budget Enforcement in the Absence of a Budget Resolution” by the Congressional Research Service, 8 June 2022.
This is another piece of evidence that the system never worked. Even when it was a brand new system in 1977, and everyone was invested in making it work, budgets were always a month or more late. The late 1970s were a time of unified Democratic control of government, and there was less partisan rancor than today, but it still didn’t work. Today leaders of each house are taking advantage of the system to increase their power since continuing resolutions and omnibus bills reduce the power of committees, so things have gotten MUCH worse. But the system didn’t work as designed when new.
I would submit again that the problem is that the government is simply too large for Congress to budget for.
In 3 of the 4 years that the congressional budget was early or on time, both houses were controlled by Republicans. Perhaps the budget chairmen and ranking members should get more credit; nonetheless, here are the Senate and House Majority Leaders in the years that the congressional budget resolution was early or on time:
1994 – George Mitchell, Dick Gebhart (D)
2000 – Trent Lott, Dick Armey (R)
2001 – Trent Lott, Dick Armey (R)
2004 – Bill Frist, Denny Hastert (R).
* No you don’t have to hate Ryan, and the rest of us don’t hate him because he said something mean about President Trump. I think I’ve seen the matter of Paul Ryan discussed many times here and that was never given as a reason for people to have soured on him. Geez, after all we’ve learned it’s amazing how some people feel that they have to cling to their narrative.
Don Nickles (R) was chairman and Kent Conrad (D) was ranking member in 2004, the last time the congressional budget was passed on time. Conrad starting Budget hearings when he was chairman and working with Nickles as ranking member to get a budget passed on time says a lot about him.
I concur. Excellent post. The system is definitely broken.
Since the budget is their main job, tie Congressional pay to passing a budget.
The national debt is not greater than the combined wealth of every person, corporation, and government on earth.
Per the St. Louis Fed, national wealth was (positive) $153 trillion in 2021. Per Wikipedia — older data — it was $123.8 trillion in 2014.
I’m going to point out something that will probably be unpopular.
Y’all sound like the Climate Change crazies. The Sky Is Falling!
The argument in the OP is that Congress has been behaving like “drunken sailors” since, what, 1977? And that this will bring a “catastrophe”?
But it’s been 45 years, hasn’t it? The sky hasn’t fallen.
I would like a better system, but the alarmism seems misplaced.
I don’t know–didn’t seem like alarmism to me. Great frustration? A feeling that enough’s enough? Sure. Congress doesn’t do its main jobs, and it has increasingly shirked many of its institutional prerogatives over the years by delegating them to executive branch agencies.
So, no, the sky hasn’t fallen yet, but that doesn’t mean we have to be “chill” about it indefinitely.
Here’s the graph of total public debt as a % of GDP since 1789 to 2022. (The left half of the graph should be taken with a load of salt as GDP was not measured back then.) Essentially it’s the same as for a family measuring debt to income ratio.
The most worrying point is that we have reached WWII levels of debt ratio without facing a crisis of the same proportion. Yes, the COVID lockdown was a crisis, but not nearly of the same magnitude or duration as WWII. The IMF says that statistically a ratio over 77% increases the risk of default, and we are at about 120%. We can sustain a higher rate than other countries because we have the world’s reserve currency and because we are a large economy less dependent on cross-border capital flows. So a 120% ratio does not spell immediate disaster.
Bu there are three worrying factors. First, we face three major adversaries of varying capabilities (China, Russia, and Iran). We have little spare debt capacity to deal with them if there is war or to prepare for war. Second, most of our debt in the last 40 years was racked up due to normal, not crisis, spending. We’ve maxed out the credit card during prosperity. Third, high government borrowing (and regulation) is choking out useful investment and economic growth. Growing the economy so that it has more debt-carrying capacity is a way out of the crisis.
Is the sky falling? Not yet. But the pillars that support the sky are starting to shake, and the drunken sailors in Washington are proposing yet another round of toasts.
I get the feeling that HR thinks it’s okay as long as the deficit/debt aren’t quite as high as the Dimocrats would LIKE them to be.
I just noticed that the lowest debt-to-GDP ratio was about the time that the current system was adopted in 1977. Another bit of evidence that the current budgeting system does not work and should be scrapped, not just tweaked.
Other notes:
Debt was declining, even during Vietnam, which is usually pictured as the period when we tried to have both guns and butter, until the mid-1970s. But once the new budgeting system was adopted, debt has been rising.
There was a drop during the 2nd Clinton term (c. 1995-2000) that coincided with Republican control of Congress and a slow rise under W., even during the Global War on Terror. Starting in about 2008, there was a sharp rise. Now who was elected in 2008? And the sharpest rise ever in 2020 with the lockdown panic.
And by “Congressional pay”, you surely mean separation from lobbyists. Sequester the members from cocktail parties, junkets, and lobbyists until they pass a budget.
That’s too easy. “Here’s our budget, $1 for everything! Now, time to paarrrr-taaayyyy!!!”