Congress’s End-of-Year Spending Free-For-All a Tradition Worth Breaking

This analysis is in response to breaking news and will be updated. Please contact pr@rstreet.org to speak with the author.

Most are all-too-familiar with Washington’s worst holiday tradition: a toxic combination of continuing resolutions (CR), omnibus spending bills, disaster supplementals, other emergency spending, tight deadlines, or some combination thereof. The almost annual showdown makes the town miserable and taxpayers a lot poorer. 

So if House Speaker Mike Johnson (R-La.) wants to break with this tradition, that is worth celebrating. The latest CR was packed with special interest handouts, unrelated policies, funding gimmicks, and dubious “economic disaster” cash grabs all bundled together in a Frankenstein’s bill of truly monstrous proportions. 

Here are just some of the problematic provisions in the 1,547 page bill: 

• $5.7 billion in emergency funding for the Virginia-class submarine program. The troubled program is already $17 billion over budget and faces significant delays. It is unclear how additional, unoffset funds will remedy the program that has already received significant investments over original estimates.
• Another nearly $1 billion in emergency spending for Department of Defense operation and maintenance and Department of Energy nuclear weapon related expenses. This does not appear to be related to disaster response needs.
• The “Recycling and Composting Accountability Act” which would require the Environmental Protection Agency (EPA) to inventory and report on recycling and composting programs. Officially, Congress avoids legislating on appropriations bills, but this is frequently violated.
• The “Nationwide Consumer and Fuel Retailer Choice Act,” which would permit year-round E15 sales and again, violate the limit on policy-making. This is a massive handout to the corn ethanol industry that they have been pursuing for a long time. R Street has raised concerns about expanding the sale of environmentally risky higher ethanol blends in the past. Supporters claim greater access to higher ethanol blends could lower costs for consumers, but any “savings” are quickly eclipsed by more frequent fill-ups, damage to small engines, and polluted waterways. 
• The legislation waives commonsense income and proof of needs-based limits to certain types of disaster aid. 
• A four-year extension of state authority to reimburse victims of Supplemental Nutrition Assistance Program (SNAP) benefit theft up to twice a year. Theft and fraud is a massive problem for households who rely on the SNAP program, but a lengthy extension will be a costly headache for both users and government finances. An additional four years of the status quo only postpones adoption of stricter security measures that are urgently needed to prevent theft in the first place.
• $10 billion in direct payments to commodity producers suffering from slightly less than previously enjoyed record-high incomes. This unoffset spending is difficult to justify when the farm economy is strong. Median farm household income remains above median U.S. household income,  input costs are falling, farms have a low debt-to-asset ratio, and bankruptcies are down. Not to mention, commodity producers have a robust, costly, and multi-layered taxpayer-funded farm safety net designed to protect farmers from precisely the market dip some row-crop producers are experiencing. It also bears repeating, that the corn and soy producers, who are on the receiving end of these payments, are also benefiting from the year-round E15 windfall elsewhere in this legislation.
• $21 billion in emergency spending for farmers who experienced natural disasters in the past two years. This is far more reasonable than other emergency spending for farmers in the CR. Most notably, Hurricane Helene hit producers in western North Carolina–primarily small farms growing vegetables, fruit, and nuts and who frequently do not have access to other federally backed safety net options–were hit extremely hard in a manner never seen before. Their losses were severe, not losing merely a crop year, but the very land itself as flood waters scoured mountains and valleys down to bedrock. This is an example of a true emergency and the dire state of their extreme need stands in sharp contrast to the commodity producers who are facing a very typical change in market dynamics consistent with those experienced by all who do business. There is a significant difference between those dealing with urgent unmet needs, which does qualify as an emergency, versus looking back more than a year to earlier challenges experienced by farmers who are not actively in crisis. Legislators should not treat these very different groups of farmers in the same way.

The path forward for this behemoth is uncertain. What is certain, however, is that we cannot afford to uphold this pricey tradition which will inevitably become bogged down with legislative favors and cronyism. Both the budget process and emergency spending need significant reforms. In the meantime, our federal finances would be better served in two ways: prioritizing urgent needs, not just nice-to-haves, and offsetting any additional spending.