Congress unveils $1.1 trillion spending bill: four things it tells us

Congress closed the loop on the budget deal reached in December, unveiling a bill that delineates how $1.1 trillion will be spent. Here's four things we learned.

A $1.1 trillion spending bill unveiled this week reveals that Congress is doing something responsible: working on a bipartisan basis to follow through on a budget deal struck last month and to avoid another shutdown of the federal government.

It doesn’t mean all is now peace and harmony in federal budget land, but it does represent progress for an institution that has become prone to dysfunction and occasional bouts of paralysis.

The bipartisan deal still requires votes of approval by the House and Senate, expected by the end of the week.

This appropriations plan would wrap all discretionary federal spending into one “omnibus” measure to fund everything from the FBI to college Pell grants for 2014.

“Although our differences were many and our deadline short, we were able to a draft a solid piece of legislation that … keeps the government open and eliminates the uncertainty and economic instability of stopgap governing,” House appropriations chairman Hal Rogers (R) said in announcing the accord.

His counterpart in the Democratic-controlled Senate, Barbara Mikulski of Maryland, and a number of budget experts outside the government echoed that general view.

The plan funds the government at a level lower than Democrats wanted, but higher than would have occurred had the automatic spending cuts known as the “sequester” had remained in place.

Here are four things this accord tells us about the federal spending and budget-related politics:

1. The political climate has shifted in an important way

It's important not to overstate the impact of this deal. In large measure, the two parties have simply agreed to a temporary truce in their budget battles. After taking blame for a two-week federal shutdown as the current fiscal year began last fall, most Republicans aren’t in a mood for a repeat as the 2014 congressional elections draw nearer.

There’s no guarantee that comity will last, but this could still be an important starting point.

Arguably the most fundamental thing Congress does is set the nation's budget and decide how that money is to be allocated. But before last year, when the current budget process began, the Senate hadn't passed a budget for four years. Instead, the government was funded through a string of stopgap continuing resolutions that lack the longer-term planning inherent in the budget process.

Getting back to this process – something lawmakers call “regular order” – is no small thing.

“This agreement shows the American people that we can compromise, and that we can govern,” Senator Mikulski said as she announced the bill with Representative Rogers.

The Rogers-Mikulski appropriations plan follows a December compromise on a budget plan between Rep. Paul Ryan (R) of Wisconsin and Sen. Patty Murray (D) of Washington. And the effort involved dozens of legislators from both parties, not just a few power brokers.

The passage of the Rogers-Mikulski bill, however, would not mark a complete return to regular order. Under regular order, Congress should pass 12 different spending bills to fund the government, not one omnibus bill. But, for now, it appears politically expedient to lump everything into one bill rather than trying to marshal support for 12 different bills. 

2. Defense is on more stable footing

Members of both parties, and most Republicans, in particular, worry that America’s military strength is being harmed by automated spending cuts under the sequester (something that kicked in last year after lawmakers couldn’t agree on other spending restraints). The new spending plan restores funding on several fronts.

The plan adds back money for military readiness on several fronts, including operations, maintenance, and procurement including new Navy ships.

A 1 percent pay raise would go to members of the armed forces and to the Defense Department’s civilian workforce. The bill also removes a recent cut in the cost-of-living increases for the pensions of disabled veterans.

3. Spending restraint is happening

The Ryan-Murray plan, known as the Bipartisan Budget Act of 2013, wasn’t a “grand bargain” that makes major strides toward things like entitlement reform. But it did chart a path to ditch what lawmakers saw as the worst arbitrary effects of the sequester, while still keeping the federal government on a path of spending restraint.

Federal outlays are still poised to grow from year to year, but at a slower pace than they would have without the efforts of budget hawks like Mr. Ryan.

Many economists say the spending-control effort means somewhat slower economic growth for now – since spending by the government can inject cash into the economy at a time when the private sector is still recovering from a deep recession.

For that reason, some economists say the budget math embodied in the new appropriations plan is misguided. Others view it as a reasonable step – not slowing the economy too much while providing some cushion against the big costs of baby boomer retirements that lie ahead.

4. Both sides can tout some small wins on policy

The recent budget deal wasn’t a transformative one for federal policies, but the spending bill does give each side some things to tout as victories. President Obama and Democrats won $1 billion in new funding for Head Start, for instance.

Republicans point to the overall restraint on spending, including cuts to initiatives they view as wasteful, such as high-speed railroads.

One side can say the Affordable Care Act will still be funded, while the other can say Obamacare didn’t win a funding boost during a key year for the rollout of its health insurance exchanges.  

Most of all, though, the spending bill may represent a victory for the legislative process.

“No area of the government [will be] functioning under a continuing resolution” under the new bill, noted a press release by Rogers's office. The spending bill “allows every program to be weighed individually and prioritized, with funding targeted to the most important and effective programs while lower-priority programs are reduced.”