Temporary Federal Spending Law Averts Government Shutdown

Published November 12, 2019

Postponing a looming legislative battle over spending, Congress and the president agreed on a short-term continuing resolution (CR) to fund the federal government through November 21.

President Donald Trump signed H.R. 4378, a CR titled Continuing Appropriations Act, 2020, and Health Extenders Act of 2019 into law on September 27. The bill contains a CR that gives Congress more time to reach an agreement on federal spending for fiscal year 2020, which began October 1.

The CR allows federal agencies to make discretionary expenditures. Mandatory spending on government entitlement programs such as Medicare or Social Security is automatic and does not require further congressional approval. Some federal agencies cannot operate or provide services unless Congress specifically authorizes the spending.

‘Essentially Wasting It’

Today’s deficit spending will become tomorrow’s taxes, says Jonathan Bydlak, president of the Coalition to Reduce Spending and a policy advisor to The Heartland Institute, which publishes Budget & Tax News.

“That money has to come from somewhere,” Bydlak said. “Either that money is coming from taxpayers today to fund various federal priorities, or it’s being borrowed and put on the credit card from people down the road.

“Most people recognize that there are things the federal government needs to do, national defense being the example people typically give,” Bydlak said. “But to the degree that the government is not spending those funds efficiently, then one of two things is happening. Either you’re taking funds from people who may be struggling or not doing as well and essentially wasting it at the federal level, or you’re harming those same people or maybe our proverbial children or grandchildren down the road. That’s the biggest harm.”

The federal government doesn’t spend our money wisely, Bydlak says.

“If you set aside concerns about the debt crisis or all these sorts of issues—which are also existential threats—there’s a more pernicious, under-the-radar, immediate cost,” Bydlak said. “We’re using limited resources for things that may not be the best use of funds.”

Free Rainbows, Unicorns

Deficit spending tempts the public to see government funding as free money, says Edward Hudgins, research director for The Heartland Institute.

“The first consequence of the profligate deficit spending that we’ve seen with this administration, and the Obama administration before it, is the notion that we can have something for nothing,” Hudgins said. “It is a delusion that we need not worry about actually producing wealth, that we can just conjure it up out of thin air, and that we can simply ignore the consequences of this delusion.

“A second consequence is seen on the debate stage as Democratic presidential candidates trip over one another to bribe voters with free everything, from rainbows to unicorns,” Hudgins said. “Such pandering politicians want to make productive citizens into spoiled brats screaming, ‘Gimme, gimme!’ so these politicians can virtue-signal and feel themselves benevolent even as they’re undermining not only America’s economy but the morality of a responsible citizenry.

“A third consequence will be seen in the long term when the country becomes less competitive internationally,” Hudgins said.

Debt Ceiling Increase

Congress passed and Trump signed into law on August 2 the Bipartisan Budget Act of 2019, a measure to allow the increased spending and borrowing authorized by the CR. That bill suspended budget caps on defense and nondefense spending through the end of FY 2021, well into the next Congress and presidential term, and suspended the ceiling on the federal debt through July 31, 2021.

Suspending the debt ceiling enables lawmakers to put off hard choices, Hudgins says.

“Frankly, the decision to suspend the debt ceiling ‘temporarily’ has become meaningless,” Hudgins said. “The purpose should be to allow time to come up with a fiscally responsible budget plan. But for years, such suspensions have led to more skyrocketing spending because of a lack of political leadership, skill, and will. We have seen no ‘art of the deal’ that has resulted in a responsible budget for a long time.”

Lawmakers from both major political parties have failed the public, Hudgins says.

“Congress, for the past decade, has been a disgraceful fiscal joke,” Hudgins said. “The Tea Party movement that arose after the election of President Obama was, in part, a reaction to out-of-control spending. With the election of President Trump and with both houses of Congress controlled by the GOP, it was hoped that responsible adults would take charge and get spending under control. That didn’t happen.”

Shutdown or Spend?

Spending more or shutting down government operations should not be the only options, Bydlak says.

“If your choice is basically to vote for increases in spending or otherwise the government is going to shut down, that’s really not the tradeoff we should be making,” Bydlak said. “There should be an alternative, which is, ‘Hey, I object to this level of spending or this level of federal involvement but also would rather not have the government shut down.’

“We’ve gotten to this point where the entire budgeting process is generally broken and doesn’t operate in the way it should,” Bydlak said. “We basically have a situation where we roll all these bills together into one and it’s an up-or-down vote.” Bydlak said. “The problem is far bigger than that, and it should never get to the point where that is the trade or the decision our lawmakers are having to make.”

Jesse Hathaway ([email protected]) is a policy advisor to The Heartland Institute.