President Obama and congressional Democrats looked at a distraction-packed September — Iran deal debate, historic papal address, pivotal Chinese state visit and the United Nations General Assembly — and decided the smartest strategy to avoid a government shutdown in three days was to offer Republicans a budgetary status quo, and use the bully pulpit to frame the parameters of a long-term deal on their terms.
While lawmakers were back home and focused on the agreement between Iran and six world powers to curb its nuclear weapons program, Obama ramped up his call to GOP leaders to end sequestration — across-the-board spending cuts that went into effect in 2012 after Congress failed to find an alternate way to keep the federal budget within limits set by 2011’s Budget Control Act.
Obama said he’s willing to sign another short-term continuing resolution to keep the government running as long as it’s free of controversial policy riders, mainly any provision that would cut off Planned Parenthood’s funding, which is almost exclusively in the form of Medicaid reimbursements.
But a long-term deal is another story.
Obama’s “opposition to locking in the sequester is steadfast,” White House spokesman Josh Earnest said earlier this month. “And that’s why I would not envision a long extension of funding at current levels, but rather enough time for Congress to finally convene the talks, reach an agreement, and implement it; thereby avoiding a government shutdown but also ensuring that our national security and economic priorities are properly funded.”
After shutting down the government in 2013 over numerous spending disagreements, Congress punted the fight over mandatory cuts two years by partially reversing sequestration. That arrangement expires, along with all government spending authority, on Wednesday.
Republicans are willing to end it only for defense and national security-related spending. Obama and Democrats, however, will only go along if domestic spending is freed up as well.
“The good news is that they’ve finally learned their lesson that they can’t negotiate with hostage-takers,” said a former top congressional Democratic aide, referring to Democrats’ concessions during the debt-ceiling crisis in 2011-12’s “fiscal cliff” and the 2013 shutdown.
Now they will insist on a one-for-one increase, meaning that for every $1 above the Budget Control Act’s limit for Defense spending, Democrats will insist on an equal raise to domestic spending, the former aide said.
The White House touts that the independent Congressional Budget Office estimates that completely ending sequestration beginning on Thursday would add 500,000 jobs and boost GDP .4 percent in the 2016 fiscal year alone.
In the simplest terms, that is what the long-term budget battle issue in a nutshell. Beyond that, specifics are few because the real negotiations haven’t begun, the former aide said.
Both sides are “just in the general posturing phase right now,” given that congressional Republicans and Democratic leaders haven’t even talked directly yet, let alone initiated formal or even informal negotiations or meetings, said the former aide.
Exactly what concessions Obama is willing to make on specific programs, departments or offsets is only known by a select few, said John Cooney, a former top Office of Management and Budget official in the Reagan administration.
“This run-up” to a possible shutdown “is like every other run-up” since the first shutdown in 1982, said Cooney, now a partner with the Washington law firm Venable LLP.
“Only the people involved in the negotiations know what the president’s ‘red lines’ are,” he said, adding “most administrations hold that close to the vest.”
As for a continuing resolution, Obama has set some wide-ranging benchmarks.
Obama told the Business Roundtable that he wants money for infrastructure, education, research and the safety net, among other things.
“So my hope is that Congress aims a little higher than just not shutting the government down,” he told the Washington-based business group on Sept. 16. “That’s a good start; we’d like them to achieve that. But I think we can do better. We can actually do some things to help the economy grow.”
Earnest elaborated a few days later, saying on Sept. 18: “We’re just looking for the kind of bipartisan compromise that prevents a government shutdown, that adequately funds our national security priorities, and makes sure that we’re not shortchanging the kinds of investments that are critical to the success of middle-class families.
“That’s what we’re looking for here; we’re not looking for the perfect piece of legislation,” Earnest added.
Although not requiring other big-ticket items be included in the stopgap measure, Democrats have been clear that they also want a long-term highway bill and the Export-Import Bank reauthorized in a long-term deal.
“They agreed that in the interest of avoiding a government shutdown, they would support a clean, short-term continuing resolution to provide more time to negotiate an agreement that invests in middle-class economic priorities and helps our entire economy grow,” the White House stated after Obama met with congressional Democratic leaders Rep. Nancy Pelosi and Sen. Harry Reid at the White House on Sept. 17.
“They also spoke about the importance of securing passage of a long-term transportation bill that creates jobs and addresses our nation’s critical infrastructure challenges, and renewing the Ex-Im Bank charter that Republicans have allowed to lapse, costing hundreds of jobs,” the statement read.
