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Tell Congress to cut billionaires, not babies.
Children's Budget Watch
President Obama and Congress have taken significant steps over the last few years to reduce the nation’s deficit and stabilize the nation’s debt. To date, policymakers have reduced deficits by $2.77 trillion over the next 10 years ($3.97 trillion if you count sequestration cuts) through a combination of spending cuts and raising revenues, although it has been heavily skewed toward spending cuts (almost 80 percent of the deficit reduction to date has come from cuts to programs).
The deficit reduction debate is far from over, and the threat to children and low-income families from repeated cuts on top of state and local cuts remains high. In the coming months, your Senators and Representatives will make critically important decisions about the federal budget that will impact our nation’s children and the long term economic health of the United States. Please share CDF’s budget principles with family, friends and colleagues and hold your Representative and Senators accountable in these coming months. Make sure you tell them to invest in children and to “Be Careful What You Cut”.
The Children’s Defense Fund (CDF) supports a federal budget that protects children and low-income families from budget cuts, invests in children to promote long-term economic growth for the nation, and ensures that the most advantaged Americans and corporations pay their fair share.
Any budget deal must improve and not worsen the state of America’s children by:
In 2014, we expect to see another series of high stakes budget debates that will have important implications for low-income families with children. The voices of children must not be drowned out by louder, better-funded voices. Tell your elected Representatives to invest in children and to be careful what they cut!
Here’s a primer on some of the budget issues that will make news in 2014:
The December 2013 Budget Deal
At the end of last year, Senate and House Budget Chairs Murray and Ryan reached a modest deal that made some progress rolling back a portion of the required sequester cuts in 2014 and 2015, mitigating their disastrous effects on children and vulnerable families, while setting spending targets for fiscal years (FY) 2014 and 2015. We were disappointed that budget negotiators left in place significant sequester cuts in 2014 and 2015 and did not begin to address the even larger sequester cuts that remain fully in place after 2015. These cuts will result in funding levels far too low to meet national needs. Additionally, the deal did not extend emergency unemployment insurance benefits for the 1.3 million long-term unemployed who subsequently lost benefits just after Christmas. The wealthiest nation on earth can afford to do better: budget negotiators failed to ask the richest Americans and corporations to pay their fair share, or close even the smallest and most egregious tax loopholes to fund desperately needed investments in children and poor families that would strengthen the American economy for years to come.
Funding for Fiscal Year 2014
The December deal paved the way for House and Senate appropriators to draft omnibus legislation that would fund the government for the remainder of FY 2014 by assigning specific dollar amounts to each authorized federal program. This legislation passed on January 18, 2014. Overall, the omnibus takes some small steps in the right direction for children, but nothing of the scope or magnitude that would constitute the level of investment we know is critical for the future of children and this nation. It gave some programs significant boosts in funding relative to recent austerity levels, while others remained the same or were cut further. However, in many cases, even the “winners” that received more money than they did post-sequester for FY 2013 received significantly less funding than they did in FY 2010 before austerity measures were applied. Of particular interest to CDF, spending for FY 2014 in the Labor, Health, and Human Services account (that funds many critical services for children and low income families such as health coverage, education, early childhood services, and much more) is down 8.5 percent from FY 2010 (excluding inflation).
Increasing the Debt Limit
The U.S. will hit its borrowing limit in early February, necessitating action to extend the federal debt limit or the federal government would default on its loans for the first time in history. Until recently, raising the debt ceiling has been a fairly routine action. Since 1980, the debt limit has been raised 42 times with strong bipartisan support until recently, when the nation has been brought to the brink of default by Republicans refusing to take action without exacting huge budget cuts that would disproportionately harm the poor. We expect legislation to be introduced soon that would increase the debt limit. CDF supports the quick passage of a “clean” debt limit increase, without any terms, conditions, or cuts that would adversely affect children and low-income families.
Funding for Fiscal Year 2015
With FY 2014 funding now wrapped up, Congress will move on to set tax and spending targets for the federal government for FY 2015, which starts on October 1, 2014. Unfortunately, the budget agreements to date formalize the level of spending in years ahead: there will be a very small increase allowed in FY 2015, and of course, there will be significant sequester cuts each year through 2023 unless Congress takes action to reduce or erase them.
Step 1: The President's Budget. On March 4, 2014 President Obama will delivered to Congress his administration’s recommendations for spending next year. Because the power of the purse ultimately lies with Congress, the president’s budget is simply a statement of the administration’s priorities and is non-binding. The president’s budget focuses on the federal fiscal year which runs from October 1 to September 30.
Step 2: The Congressional Budget. Shortly after the president releases his budget, it’s Congress’ turn. Both the House and the Senate can use the president’s budget as an outline to build their own budgets, or they can ignore it completely. Ordinarily, the House and Senate would pass their own non-binding budget resolutions and then go through a conference process to reconcile their differences. The resulting conference report becomes binding once both bodies have approved it (because it is not a law, it does not require the president’s signature). However, for the last several years, the process has not worked this way. This year, the House is expected to release a budget relatively soon, but because budget caps for FY 2015 were already set in last December’s budget deal, Senate leaders have indicated they will not write a budget for this fiscal year.
Step 3: The Appropriations Process. The House and Senate Appropriations Committees are in charge of “appropriating” or setting aside specific dollar amounts to authorized federal programs. There are 12 separate appropriations subcommittees in both the House and the Senate. For instance, within the Labor, Health, and Human Services spending bill, the subcommittee is responsible for allocating funds for programs including job training programs, the Child Care and Development Block Grant, Head Start, Title I of the Elementary and Secondary Education Act, the Maternal and Child Health Block Grant, and many others. It also has jurisdiction over Race to the Top, a signature education program of the Obama Administration.
In the appropriations process, the House and Senate are each supposed to pass 12 spending bills — one for each of the subcommittees — to fund spending for the following fiscal year. In years when Congress fails to pass some or the president fails to sign all 12 spending bills, the government can remain in operation by passing an “omnibus” spending bill which rolls all remaining spending into one bill, or a “continuing resolution” (“CR”), to fund the government until a certain date. The appropriations process must be completed by before the new fiscal year begins on October 1, 2014, or the government must shut down until Congress and the Administration are able to come agreement on temporary or full fiscal year spending (as happened at the start of FY 2014, when the federal government and all its non-essential services were shuttered for 16 days).