H.Con.Res. 85: H.Con.Res. 85 - Setting forth the Congressional Budget for the United States Government for Fiscal Year 2010 and including the appropriate budgetary levels for Fiscal Years 2009 and 2011 through 2014

H.Con.Res. 85

H.Con.Res. 85 - Setting forth the Congressional Budget for the United States Government for Fiscal Year 2010 and including the appropriate budgetary levels for Fiscal Years 2009 and 2011 through 2014

Date
April 1, 2009 (111th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

H.Con.Res. 85 is scheduled to be debated on the floor of the House on Wednesday, April 1, 2009, under a general debate rule providing for four hours of debate. The rule waives all points of order against the resolution and provides for no further consideration without another rule.

Debate on substitute amendments will be held on Thursday, April 2, 2009, subject to a rule that will be considered by the Committee on Rules on Wednesday, April 1, 2009. Summaries of amendments in the nature of a substitute will be available in a forthcoming Legislative Digest. This legislation was reported by the House Budget Committee on March 27, 2009, by a party-line vote of 24-15.

 

Background

Spending: H.Con.Res. 85 would set the federal government's budget policies over a five-year window between Fiscal Years 2010 and 2014, with a total five-year cost of $18.258 trillion. Total spending in FY 2010 would be $3.550 trillion. The budget assumes a deficit of $1.694 trillion in FY 2009, which falls to $585 billion in FY 2013 before beginning to rise again in FY 2014. Under the Democrat budget, the debt held by the public would reach $11.577 trillion in FY 2014, or 67 percent of gross domestic product (GDP), according to estimates by the Congressional Budget Office. The budget would also increase the statutory debt limit to $13.223 trillion in 2010, or 9.2% above the current debt limit.

Spending Under the Democrat Budget (in billions)

 

2009

2010

2011

2012

2013

2014

2010-2014

Outlays

3,879

3,550

3,554

3,533

3,712

3,908

18,258

Revenues

2,185

2,327

2,627

2,915

3,127

3,309

14,308

Deficit

-1,694

-1,221

-927

-617

-585

-598

-3,950

Public Debt

7,730

8,768

9,684

10,344

10,934

11,577

 

Debt Subject to Limit

12,017

13,223

14,350

15,276

16,162

17,100

 

 

The Democrat budget differs from President Obama's budget in a number of ways, designed to mask its alignment with the President's spending agenda.  In addition, the Democrat budget resolution conceals some of the expected costs of the long-term budget by using a five-year budget window and failing to include projections following FY 2014, when both the White House and CBO predict deficits to skyrocket.

 

Comparison Between the President's and Democrat Budgets (in billions)

Democrat Budget

2009

2010

2011

2012

2013

2014

2010-2014

Outlays

3,879

3,550

3,554

3,533

3,712

3,908

18,258

Deficit

-1,694

-1,221

-927

-617

--585

-598

-3,950

President's Budget

 

 

 

 

 

 

 

Outlays

4,004

3,668

3,556

3,509

3,733

3,979

18,546

Deficit

-1,844

-1,379

-970

-657

-672

-748

-4,428

The Democrat budget also assumes $471 billion less in deficits than the President's budget through 2014 by omitting certain provisions in the Obama budget and not taking into account policies likely to be enacted or extended.  Policies not assumed in Democrat budget resolution, yet expected to be continued, include:

AMT Patch:  While the Democrat budget creates a reserve fund for "deficit neutral" AMT patches beyond 2009 if they are funded by other increased taxes, the Democrat Congress has not yet increased taxes to patch the AMT since taking control of Congress in 2006.

Making Work Pay Tax Credit:  The Democrat budget resolution does not assume the preservation of the President's signature "Making Work Pay" tax credit beyond its expiration in 2010.  However, the President's budget calls for continuing the refundable tax credit at a cost of $156.3 billion through FY 2014.

TARP Funding:  The Democrat budget does not assume funding for unobligated spending through the Troubled Asset Relief Program (TARP).  The President's budget includes $247 billion in spending for the remaining TARP funds.

Taxes:  While the Democrat budget creates a $698 billion "current policy" reserve fund for continuing current "middle class tax relief," the resolution does assume the expiration of numerous tax cuts, which would increase taxes by $574 billion over five years.

Reconciliation:  The Democrat budget resolution includes reconciliation instructions requiring the Energy and Commerce, Ways and Means, and the Education and Labor Committees to report legislation by September 29, 2009.  Under the reconciliation process, each committee must report legislation to adjust mandatory spending and revenue levels to reduce spending in the budget by $1 billion over six years.  However, the reconciliation instructions do not specify what legislation the committees must report, so long as the legislation reduces the deficit by $1 billion over six years.  The three committees given reconciliation instructions are poised to report costly policies contained in the President's budget, but omitted from the Democrat budget resolution, including:

"Cap and Tax"   The President's budget proposes a $646 billion national energy tax that would cap greenhouse gas emissions from regulated entities and require businesses to purchase permits or "allowances" for their emissions-an effective tax on all energy consumption.  According to a study by researchers at Massachusetts Institute of Technology, this tax will cost the average American household up to $3,128 per year in increased energy costs.

Government Run Health Care:  The President's budget proposes a "reserve fund" of more than $630 billion in new spending on health care reform as a mere "down payment" for additional spending to come. The prime focus of their agenda is the establishment of a government-run health insurance plan, designed to "compete" against private health insurance.

Student Loans:  The President's budget proposes an effective end to federally guaranteed private-sector college loans, which would result in the government taking control of most student loans.

Reserve Funds:  The Democrat budget resolution includes 17 deficit neutral "reserve funds" that would supply funding for programs if offsets are provided (i.e., tax increases).  The 17 programs are listed below:

Health Care Reform:  Creates a deficit neutral reserve fund for "improvements to health care," which may include "making affordable health coverage available for all, improving the quality of health care, reducing rising health care costs, building on and strengthening existing public and private insurance coverage."  No funding level is specified for this program.

College Access, Affordability, and Completion:  Creates a deficit neutral reserve fund for making college more affordable and accessible or increasing college enrollment and completion through reforms to the Higher Education Act, increasing the maximum Pell grant, or other legislation.  No funding level is specified for this program.

Increasing Energy Independence:  Creates a deficit neutral reserve fund for "increasing energy independence" by providing tax incentives for renewable energy, encouraging investments in "emerging energy," limiting green house gas emissions, facilitating training for "green collar jobs."  No funding level is specified for this program.

Veterans and Service Members:  Creates a deficit neutral reserve fund for veterans and service members for any program that enhances health care for veterans or service members, and improves disability benefits, eligibility for disability and retirement compensation.

Certain Tax Relief:  Creates a deficit neutral reserve fund for "tax relief that supports working families, businesses, States, or communities."

9/11 Health Program:  Creates a deficit neutral reserve fund for a "program, including medical monitoring and treatment, addressing the adverse health impacts linked to the September 11, 2001."

Child Nutrition:  Creates a deficit neutral reserve fund for any legislation that "reauthorizes, expands, or improves child nutrition programs."

Unemployment Insurance:  Creates a deficit neutral reserve fund for any legislation that "makes structural reforms to make the unemployment insurance system respond better to serious economic downturns."

Child Support:  Creates a deficit neutral reserve fund for any legislation that "increases parental support for children, particularly from non-custodial parents."

Affordable Housing Trust Fund:  Creates a deficit neutral reserve fund for any legislation that increases the amount of capital in the Affordable Housing Trust Fund.

Home Visiting:  Creates a deficit neutral reserve fund for any legislation that provides funds to states for a program or programs of home visits to low-income mothers-to-be and low-income families.

Home Energy Assistance Program Trigger:  Creates a deficit neutral reserve fund for any legislation that "makes the Low-Income Home Energy Assistance Program (LIHEAP) more responsive to energy price increases."

Surface Transportation Reauthorization: Creates a deficit neutral reserve fund for any legislation that "reauthorizes surface transportation programs or that authorizes other transportation-related spending by providing new contract authority."

Current Policy Reserve Fund for Middle Class Tax Relief:  Creates a "current policy" reserve fund for "middle class tax relief," totaling $698.571 billion over 5 years, and $1,848.523 billion over 10 years without an offset.  Tax relief mentioned in the resolution includes extending the 10-percent individual income tax bracket, marriage penalty relief, the $1,000 child credit, among others.  The reserve fund would not be sufficient to prevent all scheduled tax increases from occurring.

Current Policy Reserve Fund for the Alternative Minimum Tax:  Creates a "current policy" reserve fund for a one-year patch of the AMT with a budget impact of $68.6 billion without an offset.

Current Policy Reserve Fund for Reform of the Estate and Gift Tax:   Creates a "current policy" reserve fund for decreasing revenues by $72 billion as a result of reforming the death tax without an offset.