House panel leaning toward lower defense budget | Politico Pro


The House Budget Committee is planning to cap defense spending at constrained levels required under the Budget Control Act, setting up a showdown between Republican fiscal and defense hawks, according to defense lobbyists, analysts and congressional aides.

The sources told POLITICO the Budget Committee is leaning toward setting base defense spending at the $499 billion sequestration cap — $35 billion less than President Barack Obama’s defense budget request that busted the spending limit by proposing tax increases.

The Budget Committee, chaired by Rep.Tom Price (R-Ga.), has not made a final decision yet on spending levels in its budget resolution that’s expected to be unveiled next month. But many throughout the Washington defense community fear there’s little that can be done to convince the House panel to change course.

“The plan right now is to mark to the BCA,” said one defense lobbyist, who like several others requested anonymity to speak candidly about internal GOP deliberations.

“In Republican political circles, it’s clear that’s what’s going to happen,” said a defense analyst with ties to Capitol Hill. “I’ve heard it from multiple places, and [from] senior parts of the party in Congress.”

Price has not said yet how he intends to approach his budget resolution. Past Republican budgets under former Budget Chairman Rep. Paul Ryan (R-Wis.) boosted defense by cutting domestic spending, but those domestic cuts made crafting appropriations bills difficult, presenting a larger problem now that Republicans control both the House and Senate.

A Budget Committee aide said discussions on the budget are still ongoing, adding Price believes the defense budget should be based on the military’s strategy, not the other way around.

While the House Budget Committee proposal will only be an opening salvo in what’s poised to be a long budget negotiation this year, it would have significant implications for defense hawks who say the military would be devastated if its funding is cut to sequestration levels.

The Pentagon has received some relief from sequestration the past two years under the 2013 deal struck by Ryan and then-Senate Budget Chairwoman Patty Murray (D-Wash.), but the sequestration caps are set to return in full next fiscal year unless the law is changed.

The Obama administration is hoping to push Republicans to agree to domestic spending increases above the caps through equal increases to defense spending. But if Republicans signal they’re willing to keep defense spending at lower levels, it would make a deal like the agreement reached in 2013 much tougher.
“If the Republican starting position in the negotiations is not raising the defense budget caps, I think that derails the whole idea of getting more defense spending,” said Todd Harrison, a budget analyst at the Center for Strategic and Budgetary Assessments.

There’s long been tension between defense hawks and fiscal hawks in the House over the 2011 Budget Control Act that set sequestration in motion. While defense hawks have warned that the defense cuts threaten to devastate the military, fiscal hawks from the GOP’s tea party wing have cheered sequestration as a real cut to federal spending.

“The party in general is proud of the BCA, and that’s not changing,” said the defense analyst. “It’s one of those signature cornerstone accomplishments, and the majority of the party is sticking with it, come hell or high water.”

Things could go quite differently in the Senate, where Armed Services Chairman Sen. John McCain (R-Ariz.) has made repealing sequestration his No.1 priority. And he says he’s been in talks with Senate Budget Chairman Mike Enzi (R-Wyo.) about ensuring defense is sufficiently funded.

In the House, there’s still time for Armed Services Chairman Rep. Mac Thornberry (R-Texas) and others on the panel to make the case to Price and other House Republican leaders that defense spending must be higher.

Thornberry still has to send his “views and estimates” letter to the Budget Committee, where he can make the case for how much defense spending is needed in the annual defense authorization bill. And there are preliminary discussions between committee members on their next steps to convince their Republican colleagues to boost defense spending.

But there’s plenty of skepticism that Republican leaders intend to make changes to sequestration when its leaders have not made the issue a priority since taking control of the Senate.

“There’s so many [Republican] members, particularly new members, that wouldn’t go along with a higher number,” said Loren Thompson, a defense industry consultant. “Then. you’ve got a real impasse and paralysis before you even get to bargaining … The bottom line is that the majority is divided, and many new members in the House don’t really understand why the military can’t make ends meet on half a trillion dollars a year.”

Roger Zakheim, a former Republican House Armed Services general counsel now at Covington & Burling, said that defense hawks may have to force the issue for GOP leaders to make sufficient Pentagon spending a priority.

“Just as there are fiscal hawk votes to be counted, there are defense hawk votes to be counted,” Zakheim said.

A lower defense base budget would have consequences for the House Armed Services Committee, which will mark its authorization bill at the spending levels in the budget resolution. The president’s $534 billion budget made hardly any cuts to weapons programs, but a $35 billion cut that could force the panel to make difficult choices.

While the House and Senate Appropriations committees could choose to move away from the budget resolution, that would be politically difficult — and the president would surely veto a set of spending bills that cut domestic spending.

The House Budget Committee is looking at a way to boost defense spending while keeping the sequestration caps, according to lobbyists and analysts, as it’s mulling a boost to the war budget — which does not count against the caps.

The Pentagon set Overseas Contingency Operations spending at $51 billion for the fiscal 2016 beginning Oct. 1, down from $64 billion in the fiscal 2015 budget as U.S. forces draw down in Afghanistan. Several sources say the panel is currently considering keeping the 2016 war budget at $64 billion, adding back nearly half of the funding that would be reduced from the president’s base defense budget request.

But that approach poses its own problems, as fiscal hawks have often railed against using the war budget as a “slush fund” to go around the budget caps.
“I’m not so sure that they can actually follow through on deliberately plussing-up the OCO budget in order to support the base budget,” Harrison said, ”because they’re already getting a lot of bad feedback from members.”

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