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Congress Passes FY2008 Budget Blueprint

On May 17, the House adopted, 214-209, the conference report for the FY2008 budget resolution (S. Con. Res. 21). The Senate approved, 52-40, the conference report that same day. The Senate passed its budget resolution on March 23 (see The Source, 3/23/07), while the House passed its version (H. Con. Res. 99) on March 29 (see The Source, 3/30/07). Although the budget resolution is non-binding, it provides a blueprint for federal spending in the upcoming fiscal year.

The report provides $954.1 billion for discretionary spending, $21 billion more than the president’s request. It also assumes $145.2 billion in emergency funding for the wars in Afghanistan and Iraq.

S. Con. Res. 21 also provides $93.9 billion in discretionary funding for education, training, employment, and social services, $7.5 billion above the president’s budget, with an additional $2 billion in advance funding for 2009. The conference report does not include the program eliminations included in the president’s budget. Additional funding is provided for investments in educational opportunities, social services, and job training. The conference agreement includes a total of $55 billion in discretionary spending for health programs in FY2008, including increases for Community Health Centers, the National Health Service Corps, and patient navigator services.

The conference report provides $34.7 billion in discretionary funding for international affairs, which funds the President’s Emergency Plan for AIDS Relief (PEPFAR), including the Global HIV/AIDS Initiative, and the McGovern-Dole International Food for Education and Child Nutrition Program.

The resolution includes a deficit-neutral reserve fund to provide up to an additional $5 billion in mandatory child care funding, and language recognizing the importance of child support enforcement. The conference report also maintains the $50 billion deficit-neutral reserve fund to expand and improve coverage under the State Children’s Health Insurance Program (SCHIP) included in the earlier versions of the budget resolution.

S. Con. Res. 21 assumes an extension of “middle class” tax relief, such as the expanded child tax credit, the ten percent tax bracket, and marriage penalty relief. However, if the projected surplus for FY2012 does not materialize, the provisions will expire.

Rep. Rosa DeLauro (D-CT) praised the budget, saying, “I am proud that we have come together and finally agree on a fiscally responsible budget. And I am proud of the work that we have done to address our most urgent priorities as a Congress and as a nation…At last we are beginning to get our house in order with a real commitment to spend our tax dollars wisely and with fiscal responsibility, finally honoring our long-standing commitments and making a modest investment in our future. By balancing our budget and even providing for a slight $41 billion surplus by the year 2012 without raising taxes, this plan reflects our priorities and takes our nation in a new direction.” Rep. DeLauro added, “Today we have a budget that makes an investment in children and families for the first time in six years. We have a budget that expands SCHIP, the hugely successful children’s health insurance program to give kids without coverage the attention and care that they need. We have a budget that ensures new resources for No Child Left Behind to make student achievement a reality, and a new commitment for Pell Grants to make college education more affordable. We have a budget that honors our veterans with the resources our VA [Veterans’ Affairs] facilities need to handle increased patient load, and provide the care our servicemembers deserve.”

Rep. Paul Ryan (R-WI) said, “[T]he choices in this budget, or some would argue, the complete lack thereof, represents an enormous missed opportunity, an enormous missed bipartisan opportunity…There is no control on the existing trajectory of spending we have in this budget. We are only five months into this Congress, and at every opportunity, the new majority has chosen the path of higher spending. They increased discretionary spending by $6 billion in the omnibus, another $20 billion or so of extraneous spending in the supplemental, and now they are increasing non-defense discretionary appropriations next year by another $23 billion.” Rep. Ryan continued, “Finally, I think the biggest failure of this budget is not what it does do, it’s what it doesn’t do. This budget does nothing to reform entitlement programs, to extend their solvency. We had a parade of witnesses [in the committee] from the left and from the right, Democrat witnesses, Republican witnesses, the Chairman of the Federal Reserve, the OMB [Office of Management and Budget] Director, the CBO [Congressional Budget Office] Director, all come to us and say, you’ve got to get a handle on entitlements. You have to reform the entitlement programs to make them more solvent, to stop this enormous unfunded liability that is hitting American taxpayers.”

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