The White House plan to reduce $15 billion in spending approved in prior years is a drop in a bucket floating on a sea. The process, called presidential “rescission,” gives Congress 45 days to eliminate federal money specified by the executive branch with simple-majority votes in both houses. If lawmakers haven’t acted in the affirmative by day 46, the funds are freed and become untouchable by a similar effort in the future.
The “$15 billion” number overstates the rescission’s effect on the deficit and is the glaze of a more ambitious idea. In April, the administration’s rumored package would have chopped up to $60 billion just from the $1.3 trillion omnibus bill enacted in March. Lawmakers—even some Republicans—cautioned that the plan could undermine the normal budget process (not that there’s anything “normal” about it these days). “If we cut a deal with somebody, we want to honor it, OK?” said Senate Appropriations Committee chairman Richard Shelby.
In the weeks that followed, not only did the White House reduce its top-line figure of suggested cuts, it shifted the origin of them, from the omnibus to money that was on the books before fiscal year 2018. So although the rescission initially was a direct response to the gluttonous funding deal despised by House conservatives and the president—despite his signature—it evolved into a relatively modest proposal.
It’s not all that meaningful of a proposal, either. As White House budget director Mick Mulvaney wrote in a memo to the president, the rescission deal would decrease actual spending ”by an estimated $3.0 billion; this would have a commensurate effect on the Federal budget deficit and the national economy.” As for the other $12 billion? It comes from a combination of expired, zombie funds still on the books, and budget authority that was untapped as of May.
The largest individual sum targeted for elimination is more than $5 billion left over from a one-time appropriation to the state-federal Children’s Health Insurance Program (CHIP) in a 2015 reauthorization bill. The White House said the government’s authority to disburse this money to states expired at the end of September—meaning its argument is that the funds weren’t going anywhere, anyway.
Another example is a $4.3 billion rescission of potential loans to manufacturers producing “advanced technology vehicles” or related parts. Trump wants to ax the Bush-era program altogether. But as the White House budget office notes, “Since its inception in 2007, only five loans have been closed under this authority, and since 2011 no new loans have closed.” Between this and the CHIP funding, there is more than $9 billion in stagnant federal money—not money that is actually adding to the deficit.
Nevertheless, House minority leader Nancy Pelosi regarded the CHIP “cuts” as meaningful enough to warrant mention in a statement. “These Republican rescissions show the hypocrisy of a GOP Congress that insists on tight budgets for children and families while handing enormous, unpaid-for giveaways to corporations and the wealthiest,” she said. The package would also rescind $1.9 billion from a CHIP contingency fund for times of higher-than-expected enrollment, leaving aside $500 million. It’s good practice in business and in government to budget for times of crisis. But that’s a matter of fiscal responsibility, not of tangible effect—not of actually “tightening” a family’s budget.
Then there’s the flip side: House majority leader Kevin McCarthy wrote this week in the Washington Examiner that the de facto $3-billion rescission amounted to “a much-needed spring cleaning.” Perhaps—of one corner of one room in a rather large mansion.
House speaker Paul Ryan may have signaled that there is a long-term plan for dusting off the rescission process, which hasn’t been executed since the Clinton administration. “This is an important effort to revive a budget-cutting tool that has been ignored for too long,” he said in a statement. The Washington Post reported that Republicans could take aim later this year at the omnibus with rescission, after all, in the amount of $10 billion. Maybe it really would be $10 billion affecting the deficit, not lounging on a couch in the Treasury.
But for any simple argument of accountability, efficiency, or transparency, there is a larger and better argument for not passing $1.3 trillion budgets harum-scarum in the first place. Doing so is the result of Congress lacking an orderly budget and appropriations process—which is to say nothing of Washington lacking a spine to make Medicare and Social Security sustainable in the long run. There is an irony here: Defining fiscal responsibility down to rescinding money that never was going to be spent and sounding the alarm of an impending debt crisis are unmistakably related.
