U.S. Budget Showdown: Three Problems To Tackle
With a possible government shutdown on their hands, Republican and Democratic lawmakers have not one, but two fiscal budgets to worry about; while the 2011 budget is yet to be resolved, simultaneous planning for the 2012 budget should begin next week.
Last October was the start of the 2011 fiscal year, and it began unfunded. The Democratic-controlled Congress of last year did not pass a budget.
Since then, Congress has been funding government a few weeks at a time; the deadline has been extended multiple times, with the current deadline at midnight, April 8.
But Congress has yet another fiscal problem to resolve. The government is expected to reach the debt ceiling, the maximum amount of money that the government can legally borrow, in as early as two weeks.
Lawmakers run into this issue often. And often, their solution is to raise the debt ceiling, allowing the government to deepen their debt.
Currently, the national debt is more than $14 trillion.
A Republican senator opposed to raising the U.S. borrowing limit said doing so would only put “off the tough decisions until after the next election.”
“I will vote to defeat an increase in the debt limit unless it is the last one we ever authorize,” wrote Sen. Marco Rubio (R.-Fla.) in a Wall Street Journal op-ed.
He added he would only vote for the increase if it "is accompanied by a plan for fundamental tax reform, an overhaul of our regulatory structure, a cut to discretionary spending, a balanced-budget amendment, and reforms to save Social Security, Medicare and Medicaid.”
Congress, with two fiscal budgets to square away while nearing the debt ceiling, also has an impending government shutdown to swiftly avoid in the next week.
White House officials said earlier this year that a government shutdown could affect Americans directly by delaying their Social Security checks, stalling requests for address changes, and retirement and disability claims.
The last time government came to a halt was in 1995.
Even then, Republicans are pushing for deeper cuts. The Republican-backed House passed $61 billion in spending cuts in February, and both parties, now, are defending and debating that number.
In order to tighten the U.S. budget gap that is estimated to widen to $1.65 trillion this year, Congress would need to both slash spending and raise taxes.
Any efforts Congress makes to slim the federal deficit this year will not balance the budget until another 20 years, at the least, Reuters reports Republican Representative Tim Scott saying.
For the 2012 budget, Republicans are expected to propose eliminating Medicaid, the health insurance program for low-income and disabled individuals, as well as cutting other domestic spending and taxes.
Reach reporter Raquel Estupinan here.