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Chaos, Dysfunction, and Two Certainties

February 15, 2013

There are two certainties amidst the chaos and dysfunction of Congressional negotiations on budget and appropriations.

First, there are plenty of concrete ideas for reducing the deficit that don’t require a sequester or further broad cuts in discretionary federal spending, i.e., that don’t force cuts in FDA resources. Simpson/Bowles laid out one plan. The House budget plans over the past 2 years have contained enough revenue, entitlement reforms, and targeted program cuts to qualify, as well (although they also include more sweeping discretionary cuts that we would not agree with).

Proving this point yet again, Senate Democrats agreed yesterday on a plan that would postpone sequester until next January.  The delay requires $110 billion in deficit reduction. Senate Democrats propose that half come from targeted spending cuts in defense and agricultural subsidies and half from revenue derived from ending certain tax breaks. While much ballyhooed (I received multiple press calls), there doesn’t seem to be much likelihood that Senate Republicans will agree with the proposal. Prospects for a favorable reception in the House are effectively zero.

Admittedly, what is hard to accomplish is agreement on which cuts. Republicans don’t want to raise more revenue; Democrats aren’t willing to put entitlement reform on the table without further agreement on revenue increases. Still, there are more than $4 trillion worth of ideas that have been offered under various plans (probably much more in the aggregate). Congress doesn’t seem to be able to agree on even the $1 trillion over 10 years that is needed to avoid the sequester and take the immediate heat off the budget process.

Second, there seem to be no limits on the persistence and creativity of Congress when it comes to “kicking the can down the road.”  The latest idea is that March 1 is really not the deadline for replacing the sequester. Instead, the reasoning goes, federal agencies can play games with their budgets for 30 days and Congress can deal with the sequester and the expiration of the Continuing Resolution at the same time (by or before March 27).

Yesterday, CQ described the situation this way: “The sense of inevitability is intensifying about the sequester being allowed to take effect in two weeks, on the assumption it will last only a month. The consensus is that federal agencies have plenty of bureaucratic wiggle room to avoid making any cuts to programs or to their personnel rosters during March, so the end of the month (when a successor spending package to the stopgap CR needs to be completed) is the more genuine deadline. That view is shared more or less equally by congressional budget experts in both parties — which is why next week’s congressional recess is proceeding as planned — meaning that both sides are being comparably disingenuous with all their melodramatic warnings about dire consequences.”

To be clear, we are not sanguine that FDA — with most of its budget representing people costs — can maneuver its way through 30 days of sequester without consequences. However, some hope (a real deal by March 27) is better than none and we have faith that Commissioner Hamburg and her team will do their utmost to minimize any post-sequester, pre-CR damage.

Congress should use the extra 4 weeks to more seriously consider the trillions of dollars worth of ideas for reducing the deficit without across-the-board cuts in domestic discretionary spending.

Note: This analysis and commentary is written by Steven Grossman, the Deputy Executive Director of the Alliance for a Stronger FDA.

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