Earlier this week, as the Senate’s Affordable Care Act repeal effort was imploding (or not), Republicans in the House of Representatives released their 2018 budget proposal, titled “Building a Better America.” The budget, which is the result of months of negotiation and infighting between the various factions in the Republican Party, was touted by Budget Committee Chairman Diane Black (R-Tennessee) as “a plan for action.”
“In past years, our budget resolution was a vision document, but this year is different,” Black said in her prepared remarks on the budget. “With the election of President Trump, our budget goes from being a vision document to being a governing document that outlines how we build a better America for our children and grandchildren.”
This year’s budget resolution has special significance—Republicans are trying to craft a substantial tax reform policy using the reconciliation process, which means they have to pass a 2018 budget resolution, complete with tax reform instructions. The bill, however, is already meeting resistance from both far-right and centrist Republicans. Here’s what’s causing problems:
More Military Spending
The budget calls for an increase in military spending, to $621.5 billion in 2018. This is actually more military spending than the White House’s budget proposal called for, and it’s also more military spending than is permitted under the budget caps imposed by the 2011 Budget Control Act. Changing those caps would require support from Democrats in the Senate, who would be unlikely to agree to such a change without concurrent increases in non-military spending.
Safety Net Cuts
The proposal calls for a decrease in non-defense discretionary spending, to $511 billion in 2018. Over the next decade, the document calls for steep additional cuts (about $203 billion in mandatory savings and reforms) to non-defense spending—additional work requirements would be imposed on welfare and food stamp recipients and, notably, the proposal also calls for cuts to both Medicare and Medicaid (above and beyond the cuts in the House’s Obamacare repeal bill). The Freedom Caucus argues the cuts aren’t deep enough, while the moderate Tuesday Group has already come out against the proposal’s cuts.
Tax Reform Would Have to Be Deficit-Neutral
The blueprint also requires that tax reform be deficit-neutral. This is directly counter to the White House’s (and some Senate Republicans’) openness to temporary, deficit-increasing tax cuts, and it would make tax reform quite a bit harder.
GOP leaders in the House hope to vote on the budget resolution before the start of the August recess, but they are currently well short of the votes required.
