APPROPRIATIONS UPDATE: Let the Cuts Begin - Federal Budget

Federal Budget:

Published: 06/30/2003

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APPROPRIATIONS UPDATE: Let the Cuts Begin

Despite a delay in dividing up the overall discretionary spending amount (as determined in the Congressional budget resolution) among the thirteen spending categories (the 302[b] allocations), Congress is quickly moving forward with the FY 2004 appropriations bills. So far, the House Appropriations Committee has approved seven bills; the Senate Appropriations Committee has approved two. Congress intends to pass all the bills by the start of the August recess so they can be finalized before the new fiscal year starts in October. The bills cover appropriations for FY 2004, which runs from October 1, 2003 through September 31, 2004. Once each chamber passes all the bills, the House and Senate must work to reconcile their individual versions. Assuming that agreement can be reached, they are then sent to the President for his signature.

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On June 25, the House Appropriations Committee approved three bills (Labor, Health and Human Services, and Education; Agriculture; and Interior). House Appropriations Committee Ranking Member David Obey (D-WI) introduced amendments during the Labor-HHS bill debate to reduce tax cuts for the wealthy in order to restore funding cuts for priority programs. For instance, one amendment would have reduced the tax cut for the 200,000 Americans making over $1 million from $88,000 to $60,000 in 2004 and restore cuts to the Low Income Home Energy Assistance Program (LIHEAP), meals-on-wheels for elderly people, education aid to disadvantaged children, rural health care, and college grants. All of the Obey amendments were defeated on party-line votes, but the point -- that important priorities are being seriously under-funded because of the cost of tax cuts to the wealthy –- was made. Obey also introduced amendments during the debate over funding for homeland security to reduce the tax cuts for the wealthy to pay for shortchanged domestic security priorities. His argument was that it is impossible to "put the resources in the bill today because this Congress, the majority, has decided their number one, and virtually their only, priority is tax cuts."

The Senate Appropriations Committee is moving a bit more slowly but on June 26, it also approved the Labor, Health and Human Services, and Education appropriations bill.

Some examples of cuts in the committee passed bills follow:

Labor, Heath and Human Services, and Education: This is the largest domestic appropriations bill, and usually one of the most contentious and last to be considered. The overall bill provides less than a 2.7% increase from 2003, not meeting current services needs. The House Appropriations Committee approved a $138 billion measure by 33-23 vote and the Senate Appropriations Committee approved a $137.6 billion version on a vote of 11 to 3. Both bills will hold many programs to about the same amounts received this year, with only slight increases in other programs. For example, the bills would inadequately fund Title 1 education programs for low-income and disadvantaged children at less than the $1 million promised; provide a less than 3% increase to the National Institute of Health, below the cost of inflation; cut funding for the Low Income Home Energy Assistance Program; fail to meet the federal obligation to states for special education; and cut Pell Grant funding.

Interior: The House Appropriations Committee approved a $19.6 billion Interior Department and related agencies bill, slightly smaller than the FY 2003 appropriation. The bill includes reductions in funding for conservation spending, especially for the government to buy and preserve land in wilderness areas threatened by development. It also shortchanges arts funding.

Agriculture: The $17 billion approved by the House committee is 2.3% smaller than the FY 2003 Agriculture appropriations. The bill contains inadequate funding (less than the President’s proposal) for the very successful Women, Infants and Children (WIC) program that serves low-income pregnant and breastfeeding women and their children, as well as a cut to the Temporary Emergency Food Assistance Program (TEFAP), which is seeing increased needs due to the slowdown in the economy and high unemployment. The Senate has yet to mark up the Agriculture bill, but set the same allocation amount for the bill.

See a complete list of House and Senate 302(b) allocations for each of the thirteen appropriations bills.

Cynics among us have suggested that the purpose of the unusual speed in approving these bills is to mask the limited funding and outright cuts necessitated by inadequate resources. Spending for annual appropriations - constituting most of what government does outside of entitlements - has clearly taken a back seat to spending for tax cuts targeted to the wealthy. With the unprecedented federal budget deficit anticipated for FY 2003 and deficits likely to continue throughout the next decade, appropriations for the government services that benefit ordinary Americans will continue to dwindle.

The spending bills that have passed through committees confirm that forecast - less services and programs serving less people, even in such critical areas as domestic security. These federal cuts come on top of the painful budget-balancing cuts that most states are enacting, with no relief in sight.