Second Verse, Same as the First: 2024 Appropriations Watch
Katina Slavkova | January 10, 2024
After a chaotic and historically unproductive first session, the 118th Congress appears to be off to a more hopeful start in the new year. Recent news indicating congressional leaders have finally secured an agreement on the top-line numbers for funding the federal government for the remainder of FY24 is certainly a positive development that bodes well for avoiding a partial shutdown on January 19.
Exhausted and unable to break the grinding stalemate on spending negotiations late last year, Congress opted instead to take its December recess and return to chilly Washington with renewed vigor and a potential spending deal in hand to welcome 2024. By all accounts, the enthusiastic media headlines seem to suggest that this gambit had worked. But wait, can it possibly be that simple? Of course not. Congress still has plenty of hurdles to clear before this latest agreement is codified into law and federal agencies are spared a costly shutdown.
How We Got Here:
Normally, the most arduous part of any funding battle is figuring out the top-line numbers for defense and nondefense spending. But one could argue that under the current circumstances this was the easiest step of the negotiating process. After all, Congress enacted last year the Fiscal Responsibility Act (FRA) which set the discretionary spending limits, in a contentious vote, for both FY24 and FY25. Theoretically, this statutory framework should have greatly facilitated appropriations discussions.
Only it didn’t. Much ink and many pixels have been devoted to the downfall of McCarthy’s speakership, with the far-right forces in the Republican conference who opposed the FRA succeeding in removing him. These legislators were also animated in their opposition to Ukraine funding, while attaching an increased number of socially conservative riders to more spending bills than in previous years. On the fourth Speakership election vote and amid mounting pressure, Republicans landed on a relative unknown, Mike Johnson. Rather than allow a shutdown on Speaker Johnson’s watch, Congress labored to enact two continuing resolutions with the last one setting up two shutdown deadlines on January 19 and February 2. This spending two-step, while not wholly unprecedented, is highly unusual, and creates a first deadline for four appropriations bills that are typically easier to pass, followed by the remaining eight.
However, in a characteristically dramatic fashion, Congress produced yet another dizzying twist to the ongoing funding debate by arriving back precisely where it started: the spending deal codified in the FRA. For the most part, the broad outlines of the just-announced agreement between Speaker Johnson and the Democratic leadership embrace the spending figures in that public law. There are, however, some caveats.
Uncertainty in the Announced Deal:
For starters, there is still some confusion about the exact overall top-line number ($1.59 vs. $1.66 trillion) and its breakdown between defense and nondefense discretionary spending. While both sides generally concur on a defense total of approximately $886 billion, there are dueling narratives about the agreement on the nondefense side of the federal budget. Depending on which side you ask, that number is either close to $772.7 or $704 billion. Untangling the precise numbers is important for purely practical reasons, as it will dictate the work of appropriators who need to further allocate funding among the 12 annual spending bills. At a minimum, congressional leadership will need to provide clarity on which top-lines appropriators should work from as soon as possible.
Not surprisingly, Speaker Mike Johnson is touting the lower amount. Perhaps this is an initial effort to gauge the mood of conservative spending hawks in his party and further rally the base. Although it is not clear that the tactic is working as these are the same members who found the spending caps in the FRA rather unsatisfactory and insufficient. And the $704 billion figure for nondefense spending happens to be the one adopted in the FRA. Politically, not much has changed and Johnson’s predicament is eerily similar to that of ousted former Speaker Kevin McCarthy. There is a palpable sense that the new Speaker’s grace period of good will from his fractious caucus has run out. This does not bode well for timely resolution of the funding dilemma.
A Ticking Clock and Other Complications:
Aside from the differing numbers game and political uncertainty on the Republican side, Congress is (surprise!) genuinely pressed for time as well. The first shutdown deadline is less than two weeks away and recent history would warn us not to expect passage of four appropriations bills by then. After that, Congress would have only two more weeks to finalize the remaining eight funding bills before the February 2 deadline. And none of this even begins to address the conservative demands for thorny policy riders and border security reforms.
Washington has a spending deal until it doesn’t. We warned you; it can’t possibly be that simple!
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