Congress, White House Reach Budget Deal, John Boehner’s Parting Gift To Paul Ryan?

Congress and the White House have reached a tentative deal on the budget and debt ceiling that promises to make Paul Ryan's initial months as Speaker a lot easier.

Capitol Buidling Dayime2

With just days to go before John Boehner steps aside as Speaker of the House and Paul Ryan steps into a position he had resisted taking for years, Congress and the White House have reached a budget deal that seems likely to make Ryan’s first months on the job much, much easier if it goes through:

WASHINGTON — After five years of bitter clashes, Republican congressional leaders and President Obama on Monday night appeared to settle their last budget fight by reaching a tentative deal that would modestly increase spending over the next two years, cut some social programs, and raise the federal borrowing limit.

The accord, which must be approved by the House and the Senate, would avert a potentially cataclysmic default on the government’s debt and dispenses with perhaps the most divisive issue in the capital just before Speaker John A. Boehner is expected to turn over his gavel to Representative Paul D. Ryan of Wisconsin.

Shortly before midnight, House Republicans posted the text of the 144-page bill, which was labeled a “discussion draft” but appeared to reflect the tentative agreement as described by congressional aides throughout the day.

The agreement would raise spending by $80 billion over two years, not including a $32 billion increase included in an emergency war fund. Those increases would be offset by cuts in spending on Medicare and Social Security disability benefits, as well as savings or revenue from an array of other programs, including selling oil from the nation’s strategic petroleum reserves. The Medicare savings would come from cuts in payments to doctors and other health care providers.

The agreement would raise spending by $80 billion over two years, not including a $32 billion increase included in an emergency war fund. Those increases would be offset by cuts in spending on Medicare and Social Security disability benefits, as well as savings or revenue from an array of other programs, including selling oil from the nation’s strategic petroleum reserves. The Medicare savings would come from cuts in payments to doctors and other health care providers.

The $80 billion increase amounts to little more than 1 percent per year of the nearly $4 trillion annual federal budget, but carries the politically charged significance of breaking through agreed-upon spending caps that Republicans had praised as a rare display of responsible cost-control and Democrats criticized as a wrongheaded drag on economic growth.

Nonetheless, the deal would represent a major breakthrough after years of gridlock in Congress, especially on fiscal issues, as each side compromised on core issues. It frees Mr. Obama from budget battles as he looks to secure his legacy in the remainder of his second term, and gives clean starts to Mr. Ryan as speaker and to Republicans trying to persuade voters that they can be an effective governing majority.

For Mr. Boehner, the deal would deliver on his pledge to clean up “the barn” by dispensing of potential crises in a way that he hoped would silence critics who said he overpromised and underdelivered. Mr. Boehner was repeatedly caught in spending fights between hard-line conservatives in his own party and a White House eager to blame Republicans for any impasse, such as the government shutdown in 2013.

(…)

An official briefed on the terms of the spending agreement said the deal fulfilled all of Mr. Boehner’s goals in the talks by securing long-term changes in social programs, offsetting spending increases with corresponding cuts or savings; increasing military spending; achieving a net reduction in the deficit; and locking in an agreement on spending for the 2017 fiscal year.

Democrats, too, said they had achieved their goals, particularly lifting the prior spending caps and by assuring roughly equal increases to military and nonmilitary programs.

The Treasury Department had said that the government would default on its debt if the statutory borrowing limit was not raised by Nov. 3. And a temporary spending measure, which kept the government from shutting down at the start of October, will run out on Dec. 11.

The tentative agreement reached Monday night would solve each of those problems. It would keep the government financed through Sept. 30, 2017, well after Mr. Obama leaves office. And, the debt limit would be raised — technically suspended, allowing the Treasury to borrow whatever it needs — until March 2017.

And while the annual spending caps would be raised for two years, the 10-year spending caps enacted in 2011 would remain in place. Those caps will frame spending negotiations between Mr. Obama’s successor and leaders of the next Congress.

Rank-and-file House Republicans, in particular, have been resistant to authorizing an increase in the debt limit without some accompanying adjustments to mandatory federal spending programs. They have voiced opposition even as financial experts warned of the potentially devastating economic consequences of a default, and noted that raising the limit merely covers previous expenses and does not authorize any new spending.

The New York Times’ Carl Hulse notes that, while this agreement isn’t the “Grand Bargain” that Boehner and other Republicans have tried to reach for years now, it comes pretty close:

WASHINGTON — It is no grand bargain, but it is a big deal.

As he prepares to vacate the House at the end of the week, Speaker John A. Boehner helped engineer an $80 billion bipartisan budget agreement with the Obama administration that may fall far short of earlier visions of budget grandeur but would still get Congress through a potentially dangerous period for both the economy and itself.

The agreement, negotiated in secret by top congressional and White House aides, is a recognition by Mr. Boehner and Senator Mitch McConnell of Kentucky, the majority leader, that they were staring into a fiscal and political abyss.

With just days remaining before the Treasury Department estimated it would run short of cash to pay the federal government’s obligations, the two leaders of the House and Senate majorities had no clear path toward raising the federal debt limit. Many House Republicans and some in the Senate refuse to vote for any increase in federal borrowing power no matter the dire circumstances. Support for a debt-limit increase has become a sure ticket to a primary challenge from the right for many of them.

But Mr. McConnell has repeatedly promised no default. And he and Mr. Boehner, with their ties to high-ranking allies in the business and financial worlds, knew that failure to head off a threat to the government’s creditworthiness could boomerang badly on Republicans just one year from Election Day.

While fiscal turmoil might energize conservatives demanding that Republicans hold firm against the Obama administration, it probably would not sit well with many other American voters as they watched their retirement savings plummet, their mortgage rates soar, their car andstudent loan costs climb and unemployment tick back up.

Now the tentative budget agreement gives the Republican leadership the chance to persuade a sufficient number of Republicans to join Democrats in approving an increase in the debt limit that should take the government into the administration of the next president.

In fact, if approved, the deal does much more — both politically and substantively.

On the political side, it is a parting gift from Mr. Boehner to his presumed successor, Representative Paul D. Ryan of Wisconsin, who is expected to be chosen as the next speaker on Wednesday by his Republican colleagues and on Thursday by the full House.

With passage of the deal, Mr. Boehner would make good on his promise to clean out the barn a bit for Mr. Ryan and allow him time to get his feet under him as the new leader without having to face the nearly impossible job of rounding up votes for the debt limit increase.

It would give a little breathing room for more spending on politically popular domestic programs like health care research, federal law enforcement and the Coast Guard, while defusing tension between Republican hawks itching for more military spending and budget hawks demanding strict adherence to statutory spending limits. And it would avert premium increases of as much as 50 percent for millions of older people on Medicare, a potent political force.

The question remains, however, if the deal will weaken the conservative standing of Mr. Ryan — and upset his looming election — whether he had a hand in the negotiations or not.

And those conservative activists who helped push Mr. Boehner to an early retirement were not looking kindly on the agreement as details began to trickle out Monday. The group Heritage Action for America labeled Mr. Boehner a “rogue agent” working for special interests in his final hours.

“In Washington cleaning the barn is apparently synonymous with shoveling manure on the American people,” said Michael A. Needham, the head of the group, which is the political arm of the Heritage Foundation.

On the policy side, it potentially buys Republicans, congressional Democrats and the White House two years of relative budget peace by setting agreed-upon spending limits for this year and next, getting both parties through the election with a legislative truce that spares them tough political votes. It will then be up to the next Congress and president to renew the budget wars — or not.

For Democrats and President Obama, it provides the added domestic spending they had demanded and resolves some of the pressing problems they had seen in the Social Security disability fund.

Lawmakers of both parties frustrated with the haphazard way Congress has performed its fundamental duty of passing appropriations bills in recent years also see a real benefit in the budget deal. With spending levels set for the next two years, members of the appropriations committees believe they can return to the traditional process of crafting, debating and passing individual appropriations bills and have more impact on the way the government spends its money.

It is also a fitting coda for Mr. Boehner. He never did get his “grand bargain” of up to $4 trillion in sweeping tax and spending changes that he sought with Mr. Obama four years ago to right the country’s listing long-term fiscal ship. Those negotiations collapsed in acrimony — an outcome that colored the relationship between Mr. Boehner and the White House for the rest of his tenure and reduced the chance of legislative bargains between them.

In the weeks since John Boehner announced that he was stepping aside as Speaker and resigning from Congress, there has been much discussion about the outgoing Speaker using his remaining time in office to “clear the barn” by dealing with many of the long-term issues that have been sitting on the House’s docket for some time now and which cause difficulties going forward for whomever ended up replacing Boehner. This included everything from the budget for the current Fiscal Year, which was punted to mid-December thanks to a Continuing Resolution passed in late September that avoided a shutdown over Planned Parenthood funding, to the debt ceiling, which the Treasury Department says we will reach by November 3rd if nothing is done to extend it, to funding for the Export-Import Bank and a highway bill. When Kevin McCarthy followed Boehner’s lead and also stepped aside in the Speaker’s race as Republican leaders turned to Paul Ryan to step up and lead the House, the idea of taking care of these issues before the end of the month seemed to take on a new urgency. In some sense, it seemed as though leadership in the House felt that they owed it to Ryan to at least try to resolve these issues before he steps up to the plate. What was unclear to those of us on the outside, of course, was the extent to which whatever behind the scenes talks were taking place were actually accomplishing anything and whether their efforts would even have a chance of succeeding. Last night’s announcement, while tentative, would seem to suggest that they were about as successful as any reasonable person could have expected them to be.

To a large degree, of course, the fact that the talks seem to have succeeded, or that they took place at all, can be attributed to the fact that Boehner leaving office gives the rest of the House leadership a significant degree of political cover to negotiate a deal that would have been next to impossible to get done if he were staying in office and worried about further challenges to his leadership. Whatever consequences might fall from this deal, including the potential that the House leadership may have to violate the largely non-existent Hastert Rule to get it done by relying on Democratic votes to get to the 218 votes needed to get it through the House, will fall on Boehner rather than on Ryan. Indeed, I wouldn’t be surprised to see Ryan and some other members of House leadership vote against this deal notwithstanding the fact that they were obviously aware of the negotiations and likely agreed to the deal so that they have at least some sense of deniability when it conservatives wake up and realize how skillfully they have been played here. Most importantly, though, if they deal goes through then it would effectively neuter many of these conservative critics since it would take away from them what is arguably the most powerful weapon in their quiver, the threat that they could force a government shutdown over debt ceiling or budget issues some time between now and the 2016 General Election.

That last point is perhaps the best thing about the deal itself. With this agreement, Congress would effectively not have to worry about budget or debt ceiling issues until well after the 2016 elections have taken place and the next Congress in office. There won’t be any worries about having to negotiate either one of these hot button issues in the midst of a Presidential and Congressional campaign that promises to be about as contentious as any we’ve seen in recent history. If nothing else, taking those issues off the table for the next 16-23 months will do a lot to remove the “govern by crisis” atmosphere that has pervaded Washington for the past decade or more. For that alone, perhaps, we will all end up thanking John Boehner for taking the steps necessary to make this happen.

FILED UNDER: Campaign 2016, Congress, Deficit and Debt, US Politics, , ,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. Ron Beasley says:

    Not just a gift to Ryan but a gift to the Republicans running in 2016. The Republicans would have been blamed for the chaos that would have resulted from not having this bill.

  2. Mark Ivey says:

    “The agreement was panned by two prominent conservative groups, Heritage Action and the Club for Growth. The two organizations issued a joint statement saying the deal was: ‘brokered by a lame-duck speaker and a lame duck president [and] represents the very worst of Washington'”

    :))

  3. Todd says:

    I was reading some of the comments about this on another site last night. For many the takeaway seemed to be that for the House to get anything done, Republican leaders had to retire so that they wouldn’t be beholden to Conservative media. I think that’s obvious, but misses the real point. Plenty could get done under normal circumstances without the “Hastert rule”.

  4. Franklin says:

    I thought the Hastert Rule had something to do with covering up child rape so it magically goes away.

  5. C. Clavin says:

    This deal seems hauntingly familiar…like the grand budget deal Boehner walked away from once before because Ryan and the rest of the caucus wouldn’t accept it. To be clear…this is not that deal…it’s far smaller…and is all this Republican led Congress is capable of.
    Doug thinks we should all be grateful for this tremendous lack of performance. But he doesn’t support Republicans. Oh no.

  6. Hal_10000 says:

    like the grand budget deal Boehner walked away from once before because Ryan and the rest of the caucus wouldn’t accept it once Obama asked for more revenue at the last minute.

    FTFY.

  7. Ron Beasley says:

    John Boehner may have been ready to get out of Dodge City anyway but I have to give him credit for falling on the hand grenade to save his party, the country and perhaps the world economy.

  8. Jeremy R says:

    What an odd way of describing sequestration by the NYT:

    The $80 billion increase amounts to little more than 1 percent per year of the nearly $4 trillion annual federal budget, but carries the politically charged significance of breaking through agreed-upon spending caps that Republicans had praised as a rare display of responsible cost-control and Democrats criticized as a wrongheaded drag on economic growth.

    Sequestration was never meant to be help control spending, and in fact was never meant to actually occur at all. It was intended to be a threat hanging over the so called Super Committee that would force them to agree on a budget. By cutting things both parties cared about in the silliest most inefficient way possible, it was supposed to be to so senseless no responsible member of congress would ever allow its implementation. In hindsight, the agreement, obviously, greatly overestimated what they were capable of.

  9. Slugger says:

    It is not a gift to anyone. It is their job, and yes their duty to reconcile the diverse interests of 330 million people. Advancing one’s party or personal career is a far second. We all need to be more vigilant to see that our leaders live up to the expectations of their offices and the oaths they took to adhere to the responsibility that comes with the honor of elected positions.

  10. C. Clavin says:

    @Hal_10000:
    You say Obama asked for more revenue.
    Everyone who isn’t a partisan hack recognizes the problem of Republican anti-tax absolutism.
    The Grand Bargain was still to the right of Simpson Bowles and a host of other proposed deals…in every failed budget negotiation Democrats have consistently offered to cut entitlements, and Republicans have consistently not offered to increase revenues.
    Because Republicans can’t anger Grover Norquist.
    But yeah…blame Obama…because he’s a Kenyan Socialist…or something.

  11. ernieyeball says:

    @Slugger:..It is their job, and yes their duty to reconcile the diverse interests of 330 million people. Advancing one’s party or personal career is a far second.

    Sure would like a taste of whatever it is you’ve been smokin’!

  12. stonetools says:

    @Hal_10000:

    Pro tip: if you are going to rewrite history, it’s better to rewrite distant history, which isn’t fresh in the minds of everyone.

    Later that day, Obama called Boehner. The two spoke as if an agreement was still possible.

    “We’re close,” Obama said. “Call me back.”

    That night, Obama prepared his party’s congressional leaders. He warned Senate Majority Leader Harry M. Reid (D-Nev.) and House Minority Leader Nancy Pelosi (D-Calif.) that he might return to the position under discussion the previous Sunday — that is, cuts to Social Security, Medicare and Medicaid in exchange for just $800 billion in tax increases.

    Would they support him?

    The Democratic leaders “kind of gulped” when they heard the details, Daley recalled.

    By this time, Obama had become the face of the bitter debt-ceiling talks and his poll numbers were dropping. His allies on Capitol Hill cringed at his predicament but also at what he was asking them to do.

    Dan Pfeiffer, the White House communications director, recalled that the president and his team felt the weight of the global economy “on our shoulders.”

    “Is there political benefit to coming to a big budget deal with John Boehner? Sure,” Pfeiffer said. “But every other political and message imperative was thrown out the door to prevent a disaster and do the right thing for the country. That’s why we were willing to do things we wouldn’t normally do.”

    Reluctantly, Reid and Pelosi agreed to do their best to support the plan.

    Boehner, meanwhile, had gone dark.

    The House speaker did not return Obama’s call until 5:30 p.m. the next day, a Friday, when he told the president that he was again breaking off the talks.

    I know of no objective observer today that doubts that the Republicans were mainly responsible for the failure of the Grand Bargain and that it failed because Boehner caved to pressure from party conservatives. You may as well be arguing with the wind here.

  13. DrDaveT says:

    @Mark Ivey:

    The agreement was panned by two prominent conservative groups, Heritage Action and the Club for Growth.

    What more compelling recommendation could you ask for?

  14. Hal_10000 says:

    @C. Clavin:

    Did I absolve the Republicans of blame? No. Did I blame Obama? No. I simply pointed out that there were two parties that contributed to that meltdown. There’s little doubt that Obama sprung the demand for $400 billion late in the game and that Boehner felt like he’d been stabbed in the back on it. Whether Boehner’s feels were reasonable or not can be debated. I think the Republicans should have agreed to it anyway. But I lack your searing hatred of the Republican that would enable me to put 100% of the blame on them.

  15. C. Clavin says:

    @Hal_10000:
    Oh….the both sides do it nonsense.
    Got it

  16. Gustopher says:

    Those increases would be offset by cuts in spending on Medicare and Social Security disability benefits,

    Sick old people and disabled people should just work harder and pull themselves up by their bootstraps. And sick, old, disabled people? Well, they’re just going to have to tighten their belts a notch.

    For far too long, the sick, elderly disabled of this country have relied upon others to tighten their belts for them as their benefits were cut — doctors, unionized health workers, etc. would have to reach in and physically tighten their belts — but with this innovative, two pronged approach, they will have to learn to tighten their own belt, or their pants will fall down. It’s the first step to getting these sick, lazy, crippled slackabouts to walk on their own two feet.

    Listen, these are simple, common-sense solutions here. Ask not what your country can do for you, ask what sick, elderly, disabled people can do for your country.

  17. stonetools says:

    The very fact that all pundits agree that this deal could not happen absent the “cover ” of Boehner’s retirement destroys any “both sides do it” narrative. Is there any doubt that absent Boehner’s retirement we would be on our way to another last minute showdown and another looming government shutdown?
    The Democrats have their faults, but there is ONE party responsible for the budgetary deal dysfunctions of the past five years.

  18. LaMont says:

    @Hal_10000:

    It was not so much the reason Republicans backed out of the deal as it was an excuse to back out of the deal. They were still negotiating and Eric Cantor and all of his ilk pounced on the opportunity to cast a light on the President as being an untrustworthy negotiator. This faction of the GOP never wanted a grand bargain and that gave them an out to completely back out of the deal.

    But I’m sure you understand this as it is described in the link you provided! No sir – both sides didn’t do it this time…

  19. C. Clavin says:

    @Hal_10000:

    But I lack your searing hatred of the Republican that would enable me to put 100% of the blame on them.

    Searing hatred? No. It’s Republicans who sow hatred and fear and deal in emotions instead of facts.
    From your link:

    And yet, in the end, while both leaders had profound reservations about a grand bargain that would threaten their parties’ priorities, what’s undeniable, despite all the furious efforts to peddle a different story, is that Obama managed to persuade his closest allies to sign off on what he wanted them to do, and Boehner didn’t, or couldn’t. While Democratic leaders were willing to swallow either a deal with more revenue or a deal with less, Boehner’s theoretical counteroffer, which probably reflected what he would have done if empowered to act alone, never even got a hearing from his leadership team.

  20. steve s says:

    @drdavet: Exactly. If those two hate it, it’s not *certain* to be a good deal, but it’s highly suggestive.

  21. gVOR08 says:

    @Ron Beasley: When you fall on the hand grenade, you die. I expect Boehner will resurface as a very well paid lobbyist. Not nearly as heroic.

  22. steve s says:

    heritage, club for growth, and now Erick Ericktard have come out against the deal. That means i’d sign it without even reading it.

  23. Slugger says:

    @ernieyeball: I can assure you that I am smoking a legal substance. I roll it up in Washington’s Farewell Address especially the section about the spirit of party.

  24. Hal_10000 says:

    @C. Clavin:

    Searing hatred? No. It’s Republicans who sow hatred and fear and deal in emotions instead of facts.

    Yes, I always admire the way liberals factually, calmly and objectively label Republicans specifically and conservatives in general as sociopaths, racists, homophobes, sexists and extremists. Even in your comment, you couldn’t resist a “Kenyan socialist” jibe … at someone who has made it clear that he agrees with Obama on some issues (e.g., Iran, gay rights) and has never gone in for any Fox News smears.

  25. Just 'nutha ig'rant cracker says:

    it was supposed to be to so senseless no responsible member of congress would ever allow its implementation.

    Yeah, as if there are responsible Republican members of Congress.

  26. James Pearce says:

    @Hal_10000:

    Yes, I always admire the way liberals factually, calmly and objectively label Republicans specifically and conservatives in general as sociopaths, racists, homophobes, sexists and extremists.

    Great point, but –not to get all “both sides do it”– but we liberals hear all kinds of jibes too. There was a pretty funny one that showed up on Jeopardy the other day. Comparing a liberal to a flower, a contestant answered “pansy” rather than “bleeding heart.” Everyone laughed.

    Point being….we can police the language so that we’re all gentleman. But it might be easier and actually better to develop a thicker skin so we don’t melt like wax if we encounter a jerk.

    (I’d like us to be right honorable gentleman, it’s true. But for that to happen, our culture needs to stop being so needlessly antagonistic. )

  27. C. Clavin says:

    @Hal_10000:
    Well you don’t hear that out of me because I do not believe today’s Republicans are Conservatives. My record on that is crystal clear.
    Are Republicans racists, homophobes, and sexists? Well they certainly don’t have to be…but if someone is a racist, homophobe, or sexist…chances are very good they are a Republican.
    As for the Kenyan Socialist jibe…just look to your leading Presidential candidates.

  28. ernieyeball says:

    @James Pearce:..There was a pretty funny one that showed up on Jeopardy the other day. Comparing a liberal to a flower,..

    “I have to admit I had no idea that bleeding hearts were flowers.”
    Jeopardy contestant Becky Sullivan is a producer on All Things Considered.
    http://www.npr.org/sections/thetwo-way/2015/10/26/452006074/what-happens-when-your-jeopardy-response-goes-viral

    Consider me amused…

  29. Ron Beasley says:

    I’m just thankful that I may get my Social Security next month.

  30. Grewgills says:

    @Hal_10000:
    That article doesn’t support your contention that Obama sprung the new revenues on Boehner. According to the article Boehner offered $800 billion in new revenue in a convoluted way to make it appear as though he wasn’t raising taxes.

    In his offer, Boehner had used the higher, less relevant “current law” base line. Then he’d proposed lowering revenue by $2.8 trillion, which reduced the 10-year number to just under $36.3 trillion. What mattered from the White House perspective was that this number was about $800 billion more in revenue than either party was actually expecting to generate under “current policy.”
    This was an exceedingly convoluted way of coming at the tax question, and even Nabors, who is one of a small number of genuine budget experts in Washington, wasn’t sure, as he stared at Boehner’s language, whether it meant what he thought it meant. Sitting in his spacious West Wing office, Nabors might as well have been one of John F. Kennedy’s advisers in 1962, reading and rereading the cable from Khrushchev, trying to divine the carefully worded message within. He showed it to Lew, and they quickly reached the same conclusion: Boehner was saying that he was willing to accept $800 billion more in tax revenue. Or, to put it another way, Boehner was proposing to increase the government’s haul by the same amount you would get if you reversed Bush’s tax cuts for the most affluent Americans…