Senate Spending Spree Same As It Ever Was
Sometimes it feels like I’m living the same fiscal year over and over again. That’s because just like last year, around this same time, Senate appropriators have announced a spending deal that will let them bypass the spending caps agreed to in the Fiscal Responsibility Act of 2023 (FRA) by simply designating the additional spending as “emergency”—even if the causes are foreseeable or persistent—and therefore exempt from spending restrictions or pesky pay-fors. Off-budget spending is becoming an expensive habit, adding trillions of dollars in new spending to our debt, exacerbating inflation, and making us more vulnerable in the face of true emergencies.
Well, how did I get here?
It’s easy! Debt and deficits quickly accumulate when legislators consistently undermine modest, bipartisan spending restrictions. During the Budget Control Act (BCA) years, this meant regularly amending the caps to permit greater spending, thereby eliminating the threat of the dreaded sequester, and abusing emergency spending. I wrote about this growing problem in 2017. Repeatedly. Again in 2019 and 2022. And last year, R Street sent a coalition letter to Congress advising it was premature to misuse emergency spending for the express purpose of bypassing the debt ceiling deal before it had even been signed into law.
At $34.5 billion, this year’s agreement between Chair Patty Murray (D-Wash.) and Ranking Member Susan Collins (R-Maine) is more than double their Fiscal Year 2024 deal. For FY25, Senate appropriators plan to increase non-defense discretionary spending by $13.5 billion and defense discretionary spending by $21 billion—far above the FRA’s 1 percent planned hike. It’s notable that the Pentagon’s own spending request for FY25 was in-line with FRA limits. The House of Representatives likewise passed an FY25 Defense Appropriations bill that complied with the current caps.
In years past, lawmakers at least tried to maintain the appearance that extra-budgetary expenditures were urgent necessities in the face of danger or suffering. Congress frequently used one popular BCA-era gimmick, the Overseas Contingency Operations (OCO) account, to boost total Pentagon spending. Widely recognized as a slush fund, OCO still had a veneer of justifiable extra-budgetary spending because the United States was in the midst of a global war on terror.
After a point, it becomes hard to argue a 20-year-long conflict was in any way a contingency with a straight face, particularly as OCO was increasingly used to fund items that were not overseas and were more suited to the base budget. But at least legislators had the conceit of an actual armed conflict to rationalize this gimmick.
Murray and Collins’ latest deal clearly shows that lawmakers have stopped pretending that the special treatment allowed for emergency spending is anything less than a fiscal fiction; a label applied as needed to avoid complying with the law and any tough decisions it might require.
Making emergency spending a matter of course rather than a rare, once-in-a-lifetime exception in response to unfortunate and truly unforeseen circumstances, is abysmal budgeting. In his testimony before the Senate Committee on the Budget—ironically, the same week Murray and Collins announced their deal—Congressional Budget Office Director Phillip Swagel outlined the dire consequences of persistent overspending, including slowed economic output, which makes a large automobile or beautiful house out of reach for many consumers.
Swagel explained that earlier unoffset, supplemental spending—in this case nearly $95 billion for Ukraine, Israel, and Taiwan—had driven deficit projections higher than earlier estimates. He went on, “Beginning in 2025, interest costs are greater in relation to [Gross Domestic Product] than at any point since at least 1940 (the first year for which the Office of Management and Budget reports such data) and exceed outlays for defense and outlays for nondefense programs and activities.”
Experts warn that without corrective action, the United States could be on the verge of a “debt doom loop” or spiral, with Senate appropriators’ actions pushing us closer to that inescapable event horizon. Worse, by recklessly misusing emergency spending in this manner, they leave the country more vulnerable to actual emergencies and ensuing hardships. After the money’s gone, lawmakers will have far fewer tools with which to respond to any number of truly unanticipated events. A healthy fiscal outlook and strong economy is the best fortification against any global threat.
In contrast, while his colleagues were contemplating how to evade spending limits, Sen. Mike Braun (R-Ind.) was dropping Senate versions of five new budget reform bills that would enhance transparency and fiscal accountability. Unfortunately for taxpayers, Braun is retiring to seek statewide office and won’t be there to keep up the fight for these essential policies next Congress. But his proposals would go a long way toward reining in the ever-increasing federal budget.
Going forward, taxpayers need federal legislators to step up and end the supplemental spending charade. And where real, unpredictable emergencies exist, insist on pay-fors and future reforms. Without reinvigorated leadership, Congress will just keep letting the days go by and the debt accrue.
Congressional Budgeting Groundhog Day
Explore years of R Street Institute expert Nan Swift warning about Congress abusing emergency spending.