Treasury Secretary Steven Mnuchin and Speaker Nancy Pelosi are closing in on a budget deal that would raise both defense and non-defense spending for the next two years while raising the debt ceiling at least through 2021.
“The talks are down to some technical language issues,” said a source close to the negotiations.
While neither side will be completely happy with the agreement, sources close to Mnuchin and Pelosi describe it is a “real compromise” that gives both parties some of what they want while permanently ending the sequester requirement under the 2011 budget law. That law calls for $125 billion in automatic spending cuts if no new deal is reached.
The sequester was supposed to put a gun to the head of Congress and the president, forcing them to sign off on a budget. All it did was encourage a series of spending resolutions that used the previous year’s spending as a baseline, jacking up spending almost faster than the Fed could print the money.
While a “topline” spending level for the Mnuchin-Pelosi compact is still unclear, it will be higher than current funding levels for both defense and non-defense programs, a key issue for Democrats, said the sources. There will be approximately $75 billion in offsets as part of the agreement, a move designed to ameliorate concerns by President Donald Trump and GOP leaders.
No word on what will be cut in the “offsets,” but the way this con game usually works is the cutting is divided equally between defense programs and social programs. Then, when no one is looking, the spending is largely restored.
Several sources suggested that “poison pill” language will be barred, meaning Democrats cannot seek to get rid of the Hyde amendment prohibition on using federal funds for abortion, or further restrict Trump’s use of Pentagon money for his border wall project until legal challenges on the issue are resolved.
If Democrats ever get control of the Senate, repealing the ban on federal money for abortions is a real possibility. Previously, there were a half dozen or more Democratic senators whose vote to maintain the Hyde Amendment could be counted on. Even a Democratic majority in the House would have been unable to repeal it because there were a couple of dozen conservative or moderate members who knew the power of the issue.
Those days are long gone. Cheered on by radical feminists, democrats have turned the Hyde amendment into a symbol of “oppression” for women. As for GOP senators, it may be a hill to die on if the effort at repeal gets that far. So for the moment, the ban on federal monies for abortion appears safe.
Not so our future. Is there nothing to be done to bring sanity to our budget process? Awakening to the burgeoning debt crisis would be a good start. The rest of the world is financing our profligate spending by purchasing Treasury bonds. Both China and Russia have threatened in the past to dump their T-bills and set off a worldwide panic that would almost certainly lead to a depression. The U.S. is basically at their mercy, although taking down the U.S. economy would also destroy their own.
There is no such thing as a “budget hawk” anymore and what passes for “conservative lawmaker” on the Hill has become extinct.