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House Mulls Using Reconciliation to Cut Mandatory Spending

A proposal to axe $500 billion from mandatory spending programs in the Fiscal 2018 House budget resolution via reconciliation is gaining some support, according to congressional contacts. However, the 10-year plan, not yet final or official, is drawing strong opposition from some Republicans outside the committee, such as Agriculture Chairman Mike Conaway, R-Texas, who asked for agriculture to be spared from the reconciliation instructions, adding he does not know what the Budget Committee will do.

Combined with President Donald Trump’s Fiscal 2018 budget submission next week and Senate action, putting the reconciliation instructions in a House budget resolution would open the door for Republicans to pass the cuts with a simple majority in the Senate.

If the House and Senate adopt a common budget resolution with reconciliation instructions to cut spending, authorizing committees in both chambers then separately would draw up a reconciliation bill capable of bypassing a filibuster in the Senate.

The full Trump budget submission on May 23 is expected to propose about $800 billion in spending cuts to means-tested entitlement programs and possibly additional cuts to other mandatory programs.

The budget resolution is already being written to include reconciliation instructions to the Ways and Means Committee for a comprehensive tax overhaul. The mandatory spending cuts would be added to that.

Under the plan, the budget resolution could contain reconciliation instructions to a dozen or so authorizing committees directing them to draw up legislation to cut mandatory spending programs under their jurisdiction such as food stamps, agriculture subsidies, Medicaid and Medicare and other programs. Lawmakers said the committee is considering reconciling about $500 billion in mandatory cuts over 10 years.

Conaway said agriculture should not be a candidate for reductions. “We’ve been in continuous conversation with them about what the current state of affairs is with respect to the ‘14 Farm Bill and this budget baseline and encouraged them to not do that,” Conaway said about talks with the Budget Committee. He added that the Budget Committee has “some hard decisions to make, and we’ll have to do whatever we decide once we get that number,” he said, referring to a reconciliation instruction. But Conaway argued that savings from the 2014 Farm Bill have been more than four times the $23 billion that was estimated (most of those cuts came via reduced food stamp spending, while some farm program safety net spending was above initial forecasts). Conaway added that the outlook for farmers has worsened, increasing the importance of a “vigorous, meaningful safety net.”

Conaway is also worried about deep cuts to agriculture in the Trump budget. He said he planned to meet with White House budget director Mick Mulvaney on Thursday to “pitch our case.”

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