Spending deal revealed: What got cut to avoid a government shutdown?

The spending deal to avoid a government shutdown had been agreed to last Friday, but the details of the $39 billion in cuts were not released until Tuesday.

The Environmental Protection Agency will lose $1.6 billion in funding, a 16 percent reduction from last year. Agriculture programs are being cut by $3 billion. President Obama will lose $1.5 billion out of his new $8 billion high-speed rail initiative. And for the first time, the Department of Homeland Security faces a budget cut, to the tune of $784 million, or 2 percent below 2010’s level.

It’s all in the fine print of the House Appropriations Committee roster of budget cuts, released Tuesday. The total $38.5 billion reduction from 2010 levels was the headline late Friday, following a last-minute budget deal that averted a government shutdown. Now the details are coming out.

But even as Democrats lament the spending reductions – some to a point where they will vote against the deal – the bottom line could have been a whole lot worse for those who support federally funded programs. For example:

• Funding for the preschool program Head Start will be increased by about $300 million, to $7.6 billion. Funding for Pell Grants, which aid low-income college students, and the president’s “Race to the Top” education initiative was preserved.
• The Food and Drug Administration got an increase in funding, to $2.45 billion. The federal food inspection program faces only a $10 million cut, far less than what Republicans wanted.
• Two programs funded under health-care reform – the Consumer Operated and Oriented Plan and the Free Choice Voucher program – were eliminated, but funding to implement the reform was spared. Money to implement the new financial regulatory reform was also spared.

But Republicans aren’t putting out press releases about government programs that escaped the ax. They’re all about the sea change in Washington’s approach to spending since the GOP took control of the House.

“Never before has Congress made dramatic cuts such as those that are in this final legislation,” said Rep. Hal Rogers (R) of Kentucky, chairman of the House Appropriations Committee, in a statement Tuesday. “The nearly $40 billion reduction in non-defense spending is nearly five times larger than any other cut in history, and is the result of this new Republican majority’s commitment to bring about real change in the way Washington spends the people’s money.”

In fact, the House committee scored the bill as cutting $39.9 billion in spending compared with the fiscal year 2010 budget. In the estimation of Senate appropriators, the cuts came to $38.5 billion.

Some of the cuts also belong under the heading “budgetary sleight of hand” – unspent funds that can just be wiped off the books in the name of “savings.” Some examples: $1.7 billion that was left over from the 2010 census, $2.5 billion in highway spending that cannot be used anyway due to legislative restrictions, and $3.5 billion in children’s health-insurance funds that were left unspent.

“Taking away student aid – that’s real,” says Peter Davis, an investment adviser with years of Capitol Hill budget experience. “When you’re taking money out of things that weren’t going to happen anyway, that’s not real.”

On aid to students, he’s referring to the budget provision that bars students from using two Pell Grants in one year – one for the regular school year, and one for summer school. That change is projected to save $35 billion over the next decade.

For some advocates who held their breath during the budget negotiations, and wound up with cuts but not complete elimination of funding, the final result is a glass half full.

One example is international family-planning money. The bill cuts US funding for the UN Population Fund to the 2008 level of $40 million. But Republicans wanted no funding. And they also did not reinstate the so-called Mexico City Policy, which withholds US funds from foreign aid organizations that use their own money to support abortion services.