Leaving the Dems Some Hot Potatoes
Outgoing Republicans are passing on spending bills
Nearly everyone on Capitol Hill calls it a mess. Democratic leaders at their end-of-the-year press conference railed about Congress's failure to finish answering the dollars and cents questions of funding the government. "They are going to leave a mess as they go out," said Democratic House Speaker-elect Nancy Pelosi. Some of their brethren across the aisle, including the Republican senator in charge of appropriations, were dismayed, too. Across town, the president's bean counters at the Office of Management and Budget also wished Congress had finished its appropriations work earlier.
But it wasn't to be. The lame duck Republican-led Congress punted nearly a half-trillion dollars in unfinished spending over to next year-to the Democrats, that is. Just when the Democrats hope to be talking about the minimum wage and college tuition and fulfilling their campaign pledges for a "new direction," they'll be saddled with looking backward and making a host of spending decisions fraught with peril. Their plans to hit the ground running with a flurry of politically popular initiatives may just have run into a gaping pothole.
That's because the lawmakers who left Washington last week-after working for just 103 days this year, fewer than the "Do Nothing Congress" of 1948-completed only two (defense and homeland security) of the 11 spending bills that finance 13 government agencies. Late Friday, Congress instead appeared headed toward passage of a stopgap continuing resolution to keep the government funded through February. But that leaves Democrats with $463 billion in fiscal year 2007 spending issues to resolve on their watch before they take up the budget again-probably in the spring-for fiscal year 2008. "We're going to have to do two years' work in one year," says Rep. David Obey, the Wisconsin Democrat who will take over the House Appropriations Committee.
In the best of times, Congress usually tries to finish the budget process by October of each year for fiscal years that run from then through the following September. Often, a few bills drag on, but "finishing just two of the appropriations bills by January is nearly unprecedented," says Brian Riedl, a budget analyst at the Heritage Foundation.
Politics? Throughout the year, Republicans were split between fiscal hawks intent on combating special-interest spending on lawmakers' favorite programs-earmarks-and moderates who argued for more funding. Those Republican factions never fully agreed, so they decided to leave the headache for Democrats.
Veteran Congress watchers also suspect that a good deal of politics was involved in the calculus. According to this theory, some Republicans figure that Democrats will have a hard time governing with the spending bills on their shoulders, meaning they face the risk of losing momentum early. "When they found Democrats were in the majority in the House and Senate," says James Horney of the Center on Budget and Policy Priorities, "they said, 'Hey, not our problem anymore.'"
Short-term resolutions are no way to run a government. Fundamental choices aren't made-and those that have been tediously negotiated aren't acted on. Lots of agencies and programs drift into a kind of bureaucratic limbo as they lose the ability to plan. In the end, costs can also rise. The Justice Department, for example, will reportedly have 70 percent less money than the president's request because of stalled negotiations. The Census Bureau, which is trying to start a new computerized system for the 2010 census, risks a $1 billion cost overrun, if funding uncertainties mean a pilot program can't be started or the purchase must be delayed. "The more mundane-sounding but necessary accounts are the ones that get hit," Stephen McMillin, the deputy director of OMB, tells U.S. News.
Democrats are mum on what exactly they'll do next year. "We're entitled to start with a clean slate and so is the president," Obey says. "But his own party in Congress has guaranteed that's not going to happen." Many of the options have political traps, too. If Democrats want to finish the spending bills as soon as possible, they could pass them individually before mid-February or bundle them together into one big omnibus bill. But omnibus bills have a bad reputation for easily hiding lawmakers' pet earmarked projects.
Democrats campaigned this fall on earmark reform and have since reiterated their pledge; Rep. Martin Meehan said last week that party leaders are "committed to earmark reform, transparency in earmarks." But they could wind up passing an earmark reform package at the same time they're forced to resolve the funding problems in February with an earmark-loaded bill of their own. That, says Steve Ellis of Taxpayers for Common Sense, a government watchdog group, "would be a politically tone-deaf maneuver."
If they don't resolve the funding problems by mid-February, Democrats could support yet another stopgap resolution through September. But agencies, already bristling at the uncertainty caused by the resolutions, would most likely only step up their complaints-and voters would hear them. "Eventually they have to deal with it," says Horney. "Agencies find it very difficult to operate under a continuing resolution for an extended period."
And there is yet another wrinkle. OMB is knee deep in drawing up the 2008 fiscal year budget that heads to Congress in February, and the president plans to ask for a supplemental emergency spending bill for the war in Iraq and Afghanistan that some estimate could top $100 billion. "It's a distraction," says McMillin of OMB. "At a time when we would like Congress to be looking at our '08 request and thinking about that, they'll be working on other things."
With dollar signs swirling around all these questions come springtime, whatever mess Congress thinks it's in now might just get, well, messier. And for Democrats, there will be fewer opportunities to rail against Republicans. Unless they figure this one out, the warm glow of their victory this fall will seem like a long time ago.
This story appears in the December 18, 2006 print edition of U.S. News & World Report.