The Wall Street Journal writes today that Democrats are going to have a tough time enacting their spending priorities, whatever they may be. True enough. But a key statement in the article is very misleading.

But cutting costs isn't easy. Spending on nonsecurity discretionary programs has increased by about 23% since Mr. Bush took office. The White House -- prodded by conservative Republicans on Capitol Hill -- has tried to trim spending and asked Congress to cut some nonsecurity discretionary spending for 2006 and 2007.

Bush has been in office for 6 years. The dollar has lost value, and the population has grown. So you'd expect spending for discretionary programs to increase.

The question then is, what does this increase mean? How does it compare to how other things have changed?

This CBPP paper does a better job of putting domestic discretionary spending in context. Controlling for inflation and population growth, this type of spending has grown slowly and unevenly. Compared to GDP, it has decreased.

Also, where did the author get this data from? Online editions could easily have a link to the source if it's also online.

All this may seem a little nitpicky, but the idea that domestic discretionary spending is out of control is a Republican talking point, and there's no need for the Wall Street Journal to go on repeating it, in a way. Without context, the 23 percent figure makes it seem like spending on domestic discretionary programs has been normal, no more spending is needed to make up for past cuts, and this might be the place where you'd want to make cuts if you had to.

As a matter of fact, the White House intends to cut many of these programs soon.

For 2008, the White House is expected to try to squeeze funding where it previously sought cuts, including areas like Housing and Urban Development, Education, Labor and the Environmental Protection Agency, all of which were targeted for reductions in 2007.

Also, see Dean Baker for a quick takedown of other points in the article.

Sounds like Dana spoke too soon. According to the AP, the supplemental request is now $99.7 billion.

WASHINGTON - The Pentagon wants the White House to seek an additional $99.7 billion to fund the wars in Iraq and Afghanistan, according to information provided to The Associated Press.

The military's request, if embraced by President Bush and approved by Congress, would boost this year's budget for those wars to about $170 billion.

One hundred billion was just too high, apparently.

Earlier requests submitted by service branches to Pentagon brass were considerably higher, but were trimmed back after meeting resistance at the White House and from key lawmakers.

And what is going on at the OMB? Yesterday, OMB Director Portman told USA Today the suplemental will be at least $110 billion, and now we're hearing it's about $10 billion less than that. But, at least details are emerging.

• $41.5 billion to cover the costs of ongoing military operations.
• $26.7 billion for replacing and repairing equipment damaged or destroyed in Iraq and Afghanistan.
• $10 billion for body armor and other equipment to protect U.S. troops from attack.
• $2.5 billion to combat roadside bombs and other improvised explosive devices.
• $2.7 billion for intelligence activities.

EJ Dionne has an insightful column on a vital question that's been coming up a lot recently: how should we pay for wars?

This debate began as a moral one. Dionne thinks that conservatives have paid for the Iraq and Afghanistan wars in an unfair, irresponsible way. Through it all, they've supported lower taxes for the wealthy, run high deficits, and cut domestic programs.

Who then pays the cost of a war financed almost entirely by deficit spending? Mostly, it's subsequent generations of taxpayers, who have to pay our bills when we don't live within our means. In the near-term, the administration has made policy decisions that have put additional burdens on the lower and middle classes. It has cut taxes on the wealthy and slashed discretionary spending on social programs. This at a time when the rising tide is only lifting yachts.

Dionne believes that this approach has had practical consequences, too. He argues that we now just don't have the resources that more hawkish conservatives want to continue the fight. That could very well be. Another practical consequence of this strategy may have been to undermine the political will to fight a war. Perhaps it is now resented by those who fight and pay for it alone. And perhaps those who were never asked to contribute to it feel like they won't lose much if the war is discontinued.

In general, President Bush's fiscal policies have helped divide this country against itself. Could it be that this unfair approach has also helped turn it against the war?

Here's an interesting article on the mixed blessings of an earmark-free funding year.

Congressional Democrats will strip all pet-project "earmarks" from the 2007 federal budget early next year to help pay for the war in Iraq, says U.S. Sen. Patty Murray, D-Wash.

But that move will have a downside for Clark County, she said Wednesday. Murray's address to the Vancouver Rotary Club delivered a stiff dose of fiscal reality.

The county won't get the $2 million Murray hoped to deliver for the next phase of improvements to the $120 million Salmon Creek-Interstate 5 interchange, an appropriation that would have made the federal government a partner in the project for the first time.

What's more, Murray is framing this as a way to pay for the Iraq war, by which she means the $5.5 billion that the House added to the Defense appropriations bill in September.

Democratic leaders in the 110th Congress will have to find $5.5 billion in cuts to avoid running up the deficit in the current budget cycle, she said. Democrats have settled on a strategy of eliminating funding for special earmarks and adopting a continuing resolution to keep the government going for the next nine months at current spending levels, while focusing on crafting their own budget for 2008.

And finally, Murray says she supports reforming the earmarking process.

Reform of the congressional earmarks process is needed, Murray said. As things stand now, committee chairmen can insert money into the federal budget for their favorite projects at the last minute with no oversight or public notice.

Earmarks "need to be transparent," she said. "They must be done in the full committees with public input."

Much about the full-year continuing resolution is still up in the air- even the formula by which all funding will be determined. GovExec has the story.

Details about how a yearlong continuing resolution -- or joint resolution, as lawmakers have termed it - - would function began to emerge this week as congressional staff discussed the fallout from the decision to drop the nine unfinished fiscal 2007 spending measures.

The current continuing resolution to keep all departments but Defense and Homeland Security, which have separate appropriations, running was signed into law last Friday just before lawmakers left Washington for the year. It will run through Feb. 15 and generally funds agencies and programs at the lowest of the following three levels: House-passed fiscal 2007, Senate-passed fiscal 2007, or fiscal 2006 enacted.

So the budget battle of 2006 will end with a whimper, not a bang. The new Democratic leadership wants to (CQ, $) extend the continuing resolution for the entire 2007 fiscal year, with some adjustments.

Though not ideal, it's probably the best of all available options. It will:

• Impose a "moratorium" on earmarks, which could put the next Congress on a path toward more earmark reforms
• Remove a distraction for the new Congress, giving it more time to focus on an ambitious 100-hour agenda
• And let the new Congress make "adjustments" to funding formulas to avoid cuts in key services

The CR's unusual format does raise a few questions, though.

• What qualifies as an earmark under the "moratorium"?
• Will the "moratorium" be applied retroactively or prospectively? What will its fiscal impact be?
• And which "adjustments," which presumably won't qualify as earmarks, will be made?

We'll probably have to wait until January for the answers.

Expect a long-term continuing resolution for the "punted" 2007 budget. Following announcements by the chairmen of the Appropriations Committees favoring a CR, Rep. Nancy Pelosi and Sen. Harry Reid issued this statement today:

The Do Nothing 109th Congress is now complete, but too much of its work remains far from finished......To give state and local governments certainty about how and what the government is funding, and to give Congress the time to legislate these issues as it should, we support Senator Byrd and Congressman Obey in their plan to pass a year-long joint resolution early in the 110th Congress. It is not a perfect solution, but it is the best available given the fiscal mess the 109th Congress has left behind.

Posted by Matt Lewis, 06:27:03 PM



CR Extended Until Next Congress

On Saturday morning, the President signed an extension of a stopgap continuing resolution, making few changes to its destructive funding formula. It will last until February 15th. CQ ($) reports:

The stopgap spending measure does not contain major deviations from the funding formula in the previous resolutions, despite lobbying by veterans’ groups for $3 billion in additional veterans’ health care money.

The resolution calls for agencies that have not yet had their fiscal 2007 appropriations measures enacted to get the lowest of the House-passed, Senate-passed or previous year funding level.

But in a nod to concerns that veterans health care would be harmed by that formula, the resolution allows the Veterans Affairs Department to transfer up to $684 million to the Veterans Health Administration for medical services.

The Iraq Study Group, a bipartisan panel convened to ascertain the Iraq war and recommend courses of action, released its report yesterday. Recommendation 72 of the ISG is that:

Costs for the war in Iraq should be included in the President’s annual budget request, starting in FY 2008: the war is in its fourth year, and the normal budget process should not be circumvented. Funding requests for the war in Iraq should be presented clearly to Congress and the American people. Congress must carry out its constitutional responsibility to review budget requests for the war in Iraq carefully and to conduct oversight.

Almost four years into the conflicts in Iraq and Afghanistan, the president is still making emergency requests for funding. Including the $70 billion "bridge fund" in the FY2007 Defense approps bill, we have spent over $500 billion on the two wars - the vast majority of which is outside the normal budget process. Not only does "emergency" funding circumvent legislated budget caps, but, as the ISG report notes, it results in only a "perfunctory review" of the requested funds.

(via ThinkProgress)

The Center on Budget and Policy Priorities (CBPP) has written up an analysis of the Census Bureau's survey of material hardship from 2003. Among the more startling findings:

* Between one-fourth and one-third of black African American families with children (28 percent) experienced at least one of three hardships — overcrowded housing, hunger or the risk of hunger (termed “food insecurity” by the government), or lack of needed medical care — in the 12 months before the survey was conducted in summer 2003. [2] This was double the comparable rate for non-Latino white families with children (14 percent).

* Nearly one in three families with children headed by a Latino citizen (31 percent) experienced at least one of these three hardships, not significantly different from the rate for black families.

What's more, this might be the last time researchers and advocates are able to gauge the unmet need. The survey used by CBPP (and countless other analysts) - called the Survey of Income and Program Participation - will be terminated unless Congress appropriates more funding for the Census Bureau (we commented on this development back in June). That'd be a shame if Congress didn't restore sufficient funding. How else will we know how effectively federal programs are dealing with material hardship?

The Washington Post had a good editorial today on the unfinished appropriations bills.

ONE OF the basic functions of Congress is passing spending bills to fund the operations of government. Congress regularly fails to complete this work in a timely way, but the 109th Congress is set to leave on an especially negligent note. Unless something dramatic changes, it will limp to a close having completed work on just two spending bills for fiscal 2007, which began Oct. 1. The upshot is that, at best, the fiscal year will be nearly one-third over by the time the 110th Congress finishes the work left incomplete by the 109th.

This is inexcusable. The House passed all but one spending bill. The Senate Appropriations Committee reported all the spending measures by July, the earliest that's been accomplished in 18 years. Then the full Senate punted. Only two bills -- covering defense spending and homeland security -- became law; one other, for military construction, won initial Senate passage, but the conference agreement worked out with the House is now stalled.