We're two days away from a possible government shutdown and it remains to be see what our Republican-controlled Congress will do to avoid another shutdown, but it looks like the answer is spending a lot more money.
According to the Washington Post, congressional Republicans and Democrats are trying to reconcile a deal that would fund the government until fiscal 2020 with nearly $300 billion in extra money for defense and domestic programs.
Details are closely held and subject to change. But at issue is a two-year deal to increase caps on spending set by a failed 2011 budget deal. Republicans have pushed for defense increases in the neighborhood of $80 billion a year and have offered Democrats nearly as much — $60 billion or so per year — for nondefense programs.
Add in $80 billion to $90 billion worth of hurricane aid for Texas, Florida and Puerto Rico, health care funding and money for President Donald Trump’s border security plan, and the final tally could total close to $400 billion. The potential cost, over the 2018-19 budget years, would rival the deficit impact of last year’s tax measure over that period.
House Republicans are reportedly planning to pass a bill that would increase defense spending while excluding domestic spending.
The Senate is reportedly planning to pass a bill that would do both because Senate Democrats won't vote for a bill that increases defense spending if it doesn't also include more domestic spending.
If both sides get their wish, it's clear what that will mean for the federal deficit. The deficit was expected to top $1 trillion this year even before the details of this deal came into focus. It would probably be safe to assume we can add anywhere from $300 to $400 billion to that number.
I don't say that to hype deficit hysteria or panic, just to say that the nation will have no money for anything else for the foreseeable future. Government spending is set to increase as it ordinarily would or should but, at the same time, federal revenue is going to plummet under the GOP's tax cuts.
The good news is if this deal is passed, it will close the door on any significant effort to dismantle Obamacare, Medicaid, or Medicare under the current Congress.