Budget Deal at a Glance | FCNL

By Tila Neguse

House and Senate Budget chairs Paul Ryan (WI-1) and Patty Murray (WA) reached agreement last night on a deal that would avert another government shutdown and provide short term relief for the across-the-board sequestration cuts.

What Does the Deal Do?

  • Increases discretionary spending for FY2014 from $967 billion to $1.012 trillion and to $1.014 trillion in FY2015. This number is somewhere in the middle between the budget levels passed by the House and Senate earlier this year.
  • Provides $63 billion in sequester relief over 2 years, split evenly between defense and non-defense spending.
  • Increases contributions paid by federal workers into their own pensions to produce savings.

What Doesn’t the Deal Do?

  • Doesn’t close any corporate tax loopholes.
  • Doesn’t extend Emergency Unemployment Compensation (EUC) benefits, even though long-term unemployment remains high. If these federal benefits are not extended before the end of the year, 1.3 million long-term unemployed people will immediately lose unemployment insurance and another 3.6 million will lose assistance by the end of 2014.

This deal maintains an even split between defense and non-defense spending and in doing so gives much needed relief to domestic spending while dramatically increasing the Pentagon budget. Under this deal, the Pentagon does not pay its fair share and would avoid the $20 billion cut originally projected to come January 2014. Pentagon spending can and should come down—billions can be saved simply by reining in waste, fraud and abuse in the Pentagon budget. While this short term deal will relieve some of the immediate effects of sequestration, it leaves most of sequestration in place, setting up another round of tense budget negotiations in the future.

What’s next?

If the House and Senate pass this bill, Appropriations committees will then begin their work allocating funds to different programs.

Check out fcnl.org/budget for more info, and follow us on Twitter for updates and more analysis coming soon!

via Budget Deal at a Glance | FCNL.