President Barack Obama signed a bipartisan budget agreement with Congress, suspending the federal government’s debt limit and removing legislative caps on government spending.
The Bipartisan Budget Act of 2015 (BBA) removes any limits on U.S. Treasury borrowing until March 2017, and it significantly increases the “sequestration” spending caps on discretionary spending.
‘Very Bad Deal’
Romina Boccia, deputy director of The Heritage Foundation’s Thomas A. Roe Institute for Economic Policy Studies, says the budget deal is really a budget fiasco.
“In the big picture, this is a very bad deal for conservatives and a very good deal for the Obama administration,” Boccia said.
“In terms of the main points to hit, the biggest aspects of the budget deal are busting through the Budget Control Act spending caps, not only by raising them by $80 billion in fiscal years 2016 and 2017, but there’s about $150 billion in ’emergency spending,'” Boccia said. “There’s an increase in the budget caps, and there’s more spending on top of that.”
No, Really, It’s a Bad Deal
Veronique de Rugy, a senior research fellow at the Mercatus Center, says BBA is shockingly bad fiscal policy.
“It’s pretty stunning,” de Rugy said. “I find it quite astonishing.”
De Rugy says suspending the debt ceiling without immediately cutting spending is a bad deal.
“Basically, they can raise the debt ceiling as much as they want when they need it,” de Rugy said. “Not only have they done that, they have done it without any promise to cut spending in exchange or any commitment to put the country in more of a sustainable fiscal path going forward.”
Broken Promises, Again
De Rugy says BBA is the latest in a series of broken promises made by Congress.
“They promise, as they always do, to do more spending today and do saving tomorrow, which is a promise we always know will not materialize,” de Rugy said. “In fact, [this] budget deal is a way to renege on the promise made in the Ryan-Murray deal of 2013, which, too, was busting the caps and the promise to restore the caps later.
“It gets rid of a promise that was made during the Ryan-Murray deal,” de Rugy said.
Jesse Hathaway ([email protected]) is the managing editor of Budget & Tax News, a publication of The Heartland Institute.