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Update: Congressional Budget Formally Adopted


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Yesterday the Senate voted to adopt the FY 2016 budget conference agreement by a mostly partisan 51-48 vote, with Sens. Ted Cruz of Texas and Rand Paul of Kentucky the lone Republican "no" votes, and following a House vote of 226-197 to adopt it last week. As previously written, the budget resolution adopts sequestration-level discretionary spending in FY 2016, while proposing significant nondefense cuts in future years (see chart at right, and see also separate charts on defense and nondefense spending).

Recommendations for spending levels in the years beyond FY 2016 don't have any binding significance and are ultimately political statements, but the policy differences between Congress and the White House are apparent when comparing them (see below for more).

With the budget resolution in hand, Congress can now fully go about their appropriations business (which the House was able to start last week following their budget vote, with the Energy and Water and Military Construction spending bills). But this may be where it gets difficult: while the budget resolution only requires a simple majority in the Senate, appropriations bills can be filibustered, and Senate Democrats have promised to do just that to bills that adhere to that sequester-level budget. And even if appropriations make it through the Senate, the President's veto pen awaits.

These obstacles may provide pressure for Congress to reach a deal on spending similar to the Ryan-Murray deal from 2013, which raised the discretionary caps in exchange for a mix of fees and other cuts. In recent weeks, House Speaker John Boehner (R-OH) has spoken positively about the idea, as have other Republicans, while Democrats have said they're skeptical appropriators will be able to make much progress under the current limits.

On the budget resolution, some additional items to note:

  • The budget claims to balance in the long run, but doesn't appear to actually do so.
  • While discretionary spending matters for science funding, mandatory spending matters for deficits. The budget resolution directs Congress to use the reconciliation process to cut mandatory spending, but primarily through the Affordable Care Act, a.k.a. Obamacare. The House had wanted a broader spending-reduction palette to work from than just the healthcare law.
  • Deficit hawks wanted the budget to end the use of CHIMPS, or Changes in Mandatory Program Spending, which are a budget gimmick that let appropriators shift extra funding to discretionary programs without violating the spending cap. But instead, the budget resolution simply limits the practice and only phases it out in future years.
  • Previous proposals to increase the war budget, which is not subject to the spending caps, survived. The $96 billion in the budget resolution is far more than the President had asked for, and it effectively allows appropriators to skirt the spending caps and increase the defense budget (as shown here) without adopting a corresponding increase in the nondefense budget. Democrats are intending to continue their legislative fight over this.

SPENDING PRIORITIES

While the greatest interest is rightly on the overall discretionary spending target, the conference report also includes recommendations for spending by functional category. There are 20 such categories, but R&D is particularly prominent in only a handful: defense, general science and space, energy, agriculture, and health. These last four account for most nondefense R&D; there are other functions like transportation and natural resources that also contain some science and technology spending, but such spending is a relatively low share of those accounts.


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Only the overall discretionary number matters — and then only for FY 2016 — as appropriators can and do ignore the budget's functional recommendations, just like they ignore similar proposals by the President. Such recommendations are essentially political statements. Still, with that in mind, it can be of interest to examine them for differing priorities.

General Science, Space and Technology. This is the lone function composed entirely of science and technology: it only contains NSF, DOE Science, and NASA. As one might expect given the overall discretionary spending levels preferred, the President's budget is much more generous than the Congressional budget for these agencies. But it's also interesting to note that the President's proposed budget would only elevate this spending for a short time, and would actually return to the sequestration-level growth path by FY 2021 — and then drop below it.


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Energy. Herein lie all of DOE's technology programs in fossil and nuclear energy, efficiency, renewables, and grid research. There are other non-R&D programs like the Energy Information Administration, but the R&D-performing programs are roughly two-thirds of all spending. Energy technology funding remains one of the biggest sources of partisan dispute, and unsurprisingly that disagreement shows up clearly here. No doubt the Congressional majority sees energy spending as a major source of potential savings.

Agriculture (see chart). This function includes most of the Department of Agriculture's research programs, including the intramural Agricultural Research Service; the extramural National Institute of Food and Agriculture; the Economic Research Service; and the National Agricultural Statistics Service. The research components account for over half of all discretionary spending in the function; the remainder includes funding for food inspections, marketing programs, and other purposes. Somewhat surprisingly, there is a smaller gap between the parties here than elsewhere, as both the White House and Congressional Republicans proposed long-run growth above sequester levels. Agricultural R&D tends not to be the lightning rod for controversy that select other parts of the federal research portfolio can be, though House Republicans made note of their preference for competitive research over formula funds.

Health (see chart). Most federal health spending is mandatory (i.e. Medicaid), but around $60 billion a year is classed in the discretionary budget, and that's what's shown in this chart. A bit more than half of this is research spending dominated by NIH, though the Food and Drug Administration, the Centers for Disease Control and Prevention, and other health agencies also feature research components. The remaining expenditures are a broad mix of health services programs, consumer protection, and other non-R&D activities. Because of this spending mix, and the acute debates around federal healthcare programs, the recommendations here are harder to interpret. The Administration proposes only modest increases for NIH and other programs and generally envisions restrained growth in the long run, while the budget conferees would like to see more restraint in the near term. Note the above chart excludes onetime Ebola-related spending in FY 2015.