Ryan’s budget dance: Just different enough from Boehner era?

23 Dec 2015 | Author: | No comments yet »

In First Test, Ryan Placates Right to Seal U.S. Spending Deal.

House Republicans were supposed to meet at 5 p.m. to talk about a major bill to avoid tax hikes at the end of the year as well as a massive $1.1 trillion package to fund the government. With late-night texts to his members and an open-door policy for his most hard-to-please colleagues, Paul Ryan was determined to keep the usual Republican infighting from derailing his maiden government spending deal as U.S.Donald Trump informed viewers that “our country is out of control” and raised the possibility that “we’re just going to go weaker, weaker, and just disintegrate.” If Americans weren’t already feeling angry and unsafe before they watched Tuesday night’s Republican presidential debate, they surely would have been feeling furious and frightened by the end.

“House Conservatives Frustrated by Ryan’s Secret Budget Talks With Democrats,” read the headline on the Daily Signal, the Heritage Foundation’s conservative news site. “My biggest frustration is that [the negotiating process] is too opaque,” Rep. So, late Tuesday night, Ryan unveiled a few thousand pages of consequential tax, spending, and regulatory legislation costing roughly $2 trillion and gave Congress and the public two whole days to review everything.

Bill Flores, a Texas Republican, said. “We don’t have any transparency into anything that’s happening.” The unveiling of the deal probably won’t quiet those criticisms. It’s a bill that contains almost no demands that conservatives have been making for the past few months, and it will almost certainly pass thanks to mostly Democratic — not Republican — support. He made his chief of staff, David Hoppe, accessible to members of the arch-conservative Freedom Caucus for matters large and small, aides to Ryan and the group said. The 2,009-page spending legislation and a companion 233-page tax bill are the final product of months of sparring both inside and between the two parties. There, decorating the lectern and the backdrop for GOP leaders’ news conference was a Twitter-style hashtag advertising House Republicans’ new theme: “Confident America.” Was this meant to be ironic?

Witness, for example, the budget negotiations in September 2013, when Republicans told Democrats and the White House to choose between defunding Obamacare and shutting down the government. The agreement Ryan reached with fellow congressional negotiators also looks much like one Boehner would have reached: Each side scores some points, but Republican congressional majorities again will fail to deliver a high-profile, base-pumping, ideological victory over some nefarious aspect of the “Obama agenda” on which conservatives had drawn a red line. Ryan (R-Wis.) is getting through this year-end spending debate without being overtly compared to his predecessor, former speaker John Boehner (R-Ohio), who was often forced to cut similar deals.

House Speaker Paul Ryan, who earlier this month gave an upbeat speech by that name, emerged from his caucus meeting and delivered a few remarks that would seem to place the Wisconsin Republican in a different party — perhaps a different country — than the GOP’s doom-and-gloom presidential candidates. Ryan’s approach has so far paid off, earning him praise even from conservative lawmakers who don’t like the spending bill and have tried to grind bipartisan deal-making to a halt. Ryan boasted about “bipartisan, bicameral compromise” on major spending and tax bills that were a “big win” for jobs, manufacturing and foreign policy. The policy in it is sweeping, the price tag is eye-popping, the compromises are surprising, and the sum of the provisions lays bare where both parties’ priorities really are — which is a far cry from their public statements. In the first test of his nascent tenure, Ryan helped craft a proposed tax-and-spending package that appears to be a real give-and-take with Democrats.

And, despite Ryan’s promise of a more inclusive process, the negotiations ended in the same high-stakes, closed-door give-and-take involving only a handful of congressional leaders that has closed out virtually every fiscal deal in recent memory. The two towering paper stacks are the 2016 omnibus appropriations package, which funds the government through next September, and a “tax-extenders” bill that, well, extends (and in many cases makes permanent) a bunch of tax breaks that were set to expire. The triangulation may inoculate him and his party from criticism should they achieve as little as he expects. “It’s night and day,” said Representative Mark Meadows, a founding member of the House Freedom Caucus who filed a motion to depose Ryan’s predecessor, John Boehner. “I think we’ve expressed a real desire to have an open dialogue, and Speaker Ryan has not only delivered but continues to make a commitment to deliver in the future. In process and in substance, this kind of backroom deal that offers real concessions to Democrats and blows up the deficit wasn’t the change insurgent Republicans were looking for when they ousted John Boehner.

Steve King (R-Iowa), a Boehner critic, had this to say to The Washington Post’s Kelsey Snell and Mike DeBonis: “The central players in this deserve a lot of credit for working this thing as hard as they did. Much of the heavy lifting was done by Boehner, whose negotiations with Democrats set the total amount available to spend in the fiscal year that started Oct. 1 — and in doing so, eliminated the spending cuts that a 2011 deficit-reduction law would have required. And it makes everyone swallow bad news a little bit easier.” Ryan’s biggest accomplishment may have been effectively removing from the table the threat of a government shutdown as current funding ran out last week, in part by neutralizing conservatives who demanded to block Syrian refugees from entering the country and to cut off federal money for Planned Parenthood, the women’s health service. Bill Flores (R-Texas), chairman of the Republican Study Committee, a conservative caucus group. “He’s been really careful not to set high expectations. . . . You govern in prose.” This 2016 GOP race goes further: The presidential candidates are campaigning in hysterical shouts, while Republican congressional leaders are trying to govern in measured voices.

Not a bad first outing, observers inside and outside government say, but as for Ryan’s dream of comprehensive tax reform as early as next year? “Absolutely not,” said Stan Collender, a budget expert. “This deal is not the start of a new era of cooperation between congressional Democrats and Republicans. This deal sets discretionary spending levels for the 2016 fiscal year — if this portion, or something like it, doesn’t pass, the government will shut down.

It’s changed so much in a couple months.” This break in line-drawing between past and present House leaders is, it would seem, partly a testament to Ryan’s leadership style and partly a factor of his newness on the job. Similarly, the agreement to extend expiring tax cuts did not require lawmakers to offset any of the revenue lost, either by levying new taxes or reducing federal benefit programs. The war will restart and intensify next year on all other issues.” The spending and tax-break plan still awaits votes in the House and Senate and is no model of conservative legislation. Rank-and-file Republicans hoped to slam the brakes on the Obama administration’s pursuit of new labor and environmental regulations, insert new antiabortion restrictions on federal spending, and increase vetting for refugees admitted from terrorist hotbeds. It would add about $680 billion to the deficit over 10 years, according to the Joint Committee on Taxation, defying Ryan’s reputation as the party’s chief budget-cutter.

White House Press Secretary Josh Earnest said President Barack Obama would sign the bill and described it as a Democratic victory over Republican prerogatives. “We feel good about the outcome, primarily because we got a compromise budget agreement that fought off a wide variety of ideological riders, but yet ensures the priorities that this administration has identified when it comes to investing in middle class families and protecting the country,” Earnest told reporters Wednesday. “We succeeded.” Republicans won an end to a 40-year-ban on crude oil exports but had to agree to extend tax credits for wind and solar power. But since it’s such a big deal, Democrats dangled it to win all sorts of other concessions of their own (even if these were mainly concessions to the status quo). This includes a raft of business cuts like the R&D credit, but it also includes anti-poverty cuts of tremendous importance to Democrats, like the expanded child tax credit and earned income tax credit.

Keep in mind: Republicans railed against Democrats for years when they held the majority, accusing them of posting thousands of pages of bills late at night and then jamming them to passage just after sunrise. The deal preserved both parties’ sacred cows, including the GOP’s red line of no new taxes and Democrats’ demands to boost domestic and military spending equally. They successfully nixed a rider that would have blocked the Environmental Protection Agency’s proposed “waters of the United States” rule that would expand its jurisdiction against polluters under the Clean Water Act. These cuts tend to get extended on a year-by-year basis — that’s why budget wonks call them “tax extenders” — but here, they’re either being extended for a number of years or being made permanent.

Boehner’s smoking and drinking habits were well known in the Capitol; in an interview Tuesday with Politico’s Playbook, Ryan casually dropped how he gets up at 6 a.m. to work out every day. Some of the proposals that did make it into the bill are regrettable, such as a well-intentioned but poorly written measure to improve cybersecurity information-sharing that may also increase government surveillance. The $1.2 trillion deficit that Obama inherited in 2009 has plummeted to $426 billion in 2015. “This is a very old-fashioned, circa 1960s or 1970s budget bill.

Ryan is working so hard to avoid being lumped into the same category as his predecessor because he knows that to be cast as just another Boehner would be a potentially fatal blow to his speakership. But while it’s a far from perfect bill, it marks the return of a better approach to governing — one that eschews pointless threats in favor of a search for middle ground. Some Democrats on Wednesday raised objections to the lifting of the oil export ban and other provisions, but the legislative package appeared to be on its way to passage after Senate Minority Leader Harry M. A provision that would designate fewer financial institutions as “systemically important” (and thus subject to greater oversight under Dodd-Frank) was dropped.

The Affordable Care Act’s “Cadillac tax” on expensive insurance plans was scheduled to begin in 2018 but under the deal is being delayed for two years. The actual budgetary cost of these pauses and delays is pretty minor — $32 billion or so — but the fear is these pauses and delays will become permanent. Conservatives have railed for years against the sort of top-heavy deal-making required to strike a bargain on the plan, and the spending levels are much higher than they’d like. House Minority Leader Nancy Pelosi (D-Calif.) asked House Democrats in a closed-door session Wednesday to hold off on deciding until they had reviewed the bill. But overall, the storyline in the Capitol after Ryan struck a deal that looks like a page from Boehner’s playbook isn’t that Ryan threw conservatives under the bus like Boehner.

The Zadroga Act, a health care and compensation fund for 9/11 first responders and nearby workers, will be reauthorized until 2090, a hilarious year to settle on but one that effectively means permanent. A big part of what makes spending deals so controversial in Washington is the effort to use the appropriations process to accomplish controversial policy goals. These non-spending add-ons to spending bills are called “policy riders,” and examples include defunding Planned Parenthood, setting up a more stringent process for screening Syrian refugees, or telling the IRS it can’t tighten its regulations against 501(c)(4)s that raise anonymous donations. (You can see a conservative wish list of policy riders here.) In this case, the overwhelming majority of policy riders were stripped out of the final deal — including the super-controversial Planned Parenthood and refugee riders.

A closer inspection of the House’s “parts of three days rule” reveals that the regulation “does not apply to messages between the Houses.” What’s that? Boehner — and Senate Majority Leader Mitch McConnell — repeatedly suffered self-inflicted wounds with the Republican base by making lofty promises and failing to follow through. The basic deal here is that Republicans get corporate tax cuts, Democrats get anti-poverty tax cuts, and both sides (more on that in a moment) get some Obamacare tax cuts.

This deal adds $700 billion onto the national tab, and maybe much more than that if the Obamacare taxes end up delayed far into the future, which is definitely what Republicans (and some Democrats) are hoping for. While most Democrats oppose lifting the export ban, party leaders agreed to it in exchange for concessions that include an extension of renewable energy tax incentives and a new Oceans and Coastal Security Fund. The deal’s advocates argue that this isn’t really a deficit increase so much as it’s more honest accounting, because Congress extends most of this stuff every year anyway.

The move reflects Ryan’s appeal to Republicans to shift “from being an opposition party to being a proposition party.” He had Pelosi to his office to negotiate over dinner on Dec. 11. He has said Planned Parenthood shouldn’t receive federal funding, but he wants congressional committees to write legislation on the issue. “I think Paul is going to be the person inclined to not necessarily make deals but to be reasonable in his demands and try to get legislation passed. And I think he’s got a pretty good relationship with the extreme right,” said Steve Bell, a former top Republican budget aide. “And remember, he’s a policy person and is respected by his colleagues because they know he really does know policy very well.” Ryan has already conceded that he won’t be able to reach agreement with Obama on a comprehensive overhaul of the U.S. tax code next year, his longtime top policy goal. In a recent speech and in interviews, Ryan pledged to use 2016 to lay out an ambitious governing agenda that will give Republican candidates a robust platform to campaign on — particularly if the party nominates a divisive candidate in the presidential race.

But there’s nothing here that’s even tries to offset the cost of this package. “The failure to pay for this legislation is completely at odds with rhetoric about fiscal responsibility and balanced budgets,” fumes Maya MacGuineas, president of the Committee for a Responsible Federal Budget. The more urgent question is whether Ryan can achieve further modest deals in the final year of Obama’s presidency while staving off an uprising on the right. He’s now benefiting from a honeymoon period and an understanding among conservatives that the parameters of the spending deal were laid out by Boehner, before his retirement. But even if Meadows doesn’t back the omnibus, he’s at least satisfied with how Ryan handled the measures. “I’ve had more meaningful conversations with the speaker and leadership in the last couple of weeks than I have had in the last few years. Tim Huelskamp, among the more vocal Freedom Caucus members, also predicted that a majority of Republicans would vote against the $1.1 trillion appropriations package that he’s calling the “Boehner legacy bill.” In other words, Ryan will have to pass the omnibus with the same organic governing coalition of mostly Democrats and some Republicans that Boehner himself used to pass most necessary legislation.

In part, this reflects a reality that’s very different from 2010: The deficit has fallen sharply in recent years and is now down below 3 percent of GDP. A strengthening economy is exactly when you don’t want to be charging everything to the national credit card; you want to save that fiscal firepower so you have the room to maneuver the next time there’s a recession and the economy needs some stimulus. In lifting the medical device tax, the insurer tax, and the Cadillac tax, it eases the biggest pain points of four major Obamacare constituencies — medical device manufacturers, insurers, employers, and unions. I think this is bad policy, but it is, for Obamacare, good politics — Obamacare just became a better deal for four of the most powerful interest groups in the country.

One is that they think this will weaken Obamacare by making it less fiscally responsible — but since none of these taxes are being outright repealed, nothing here seriously changes CBO’s long-term estimates of Obamacare’s effect on the deficit. Republicans might see this deal as proving that portions of Obamacare can be repealed, and that this means the whole law can be dismantled and changed. In a nice piece, the Washington Post finds Republicans are already divided. “This is divided government, and if you’re going to move forward and follow Speaker Ryan’s notion that we want to move onto offense next year … then I think many of my colleagues will look at it like I do — that we need to move past this, get this done, let’s put 2015 behind us and get on to 2016,” said Rep.

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