Despite the apparent gridlock, at least one important maritime objective seems certain – increased funding for the U.S. Coast Guard

It’s that time of year again. Headlines and media accounts of the current shenanigans in Washington feature threats of a federal government shutdown over a number of issues, including a proposal to defund Planned Parenthood and other headline-grabbers about the Confederate flag and the Iran nuclear deal. Senate Majority Leader Mitch McConnell (R-KY) reassured voters that a budget agreement will be reached, thereby averting a government shutdown. At the same time, the Obama Administration has issued repeated veto threats aimed at Republican spending and policy proposals.

In the face of such conflicting predictions, what does recent history teach us about what is likely to unfold in the coming months and its significance?

Lessons from the Past

Having been badly stung politically by the 2013 shutdown of the federal government over a futile attempt to defund Obamacare, Republican congressional leaders have stated that there will be no repeat. Their public persona will, therefore, likely continue to be non-confrontational. And despite the fiery rhetoric of the Republican Freedom Caucus in the House of Representatives and its outspoken ally in the Senate, Senator Ted Cruz (R-TX), the leadership is unlikely to allow a shutdown over Planned Parenthood funding.

Instead, the Republican leadership has encouraged the Freedom Caucus to employ other legislative tools to express its anger and to exploit other congressional powers to investigate Planned Parenthood and its activities. For the Caucus and its electoral base, this might actually prove a better political strategy to keep the issue alive into next year’s congressional elections.    

Assuming Congress and the President agree to continuing resolutions and increases in the debt limit, as they have repeatedly in the past, additional time will be afforded to fashion a compromise like that in 2013. Indeed, continuing resolutions have become the norm. The last Congress not to pass a continuing resolution was in 1997. And despite all the sound and fury heralded by the media, the track record of the White House and the Republican congressional leadership is that they compromise when required.     

Of course, the path to compromise is often long and tortuous and usually achieved at the last minute. But that is the nature of the underlying political differences between the two parties’ positions, staked out with their respective constituencies, that makes compromise in the current environment possible only when necessary. Having trumpeted the fiery rhetoric that the President is a lawless executive who is reckless with American national security, Republicans find themselves forced to compromise with a villainous caricature of their own making.

So what really divides the two sides? The headline-grabbing issues of Planned Parenthood, the Confederate flag and the Iran nuclear deal are not particularly amenable to resolution in an end-of-year legislative scrum. Like previous confrontations over Obamacare and immigration, the White House has demonstrated its willingness to veto Republican proposals and let the federal government shut down if necessary, and Republicans have repeatedly been burned by that strategy.    

Different Priorities

Diving deeper into the President’s budget and congressional appropriations reports confirms the enduring disagreement about fiscal priorities that, while profound, is inherently susceptible to compromise in the short run because it is principally about the government’s borrowing power and how to spend the public’s money.

Moreover, the choice this year is really between a continuing resolution that sustains current spending levels with a little tweaking and an agreement that adopts new priorities from each side. This is really not a heavy political lift. Rather, it is the bread-and-butter of the legislative process known as “logrolling,” where one side must agree to accept the other side’s position to some extent to get what it wants. It is as old as the republic and, despite the acrimonious rhetoric, we will see more of it this year. 

Obama’s budget proposal abandoned sequestration’s strict spending caps and argued for additional funding for both defense and domestic programs. He argued that the sequestration levels are insufficient to fund national security and economic growth. He specifically urged increased federal spending on national defense, infrastructure, investments in education, and science and technology research.    

In sharp contrast, the Republican-controlled Congress adopted a budget plan that continues sequestration for domestic programs. The Chairman of the House Appropriations Committee, Rep. Hal Rogers (R-KY), proudly declared his priority is to rein in federal spending and claimed to have already cut $165 billion in discretionary spending since becoming committee chairman, including deep cuts at the Environmental Protection Agency and Internal Revenue Service. The White House complained that congressional Republicans are punishing low- and middle-income Americas while proposing off-budget funding “gimmicks” for “overseas contingency operations” to avoid the bite of sequestration for defense.

Not counting “off-budget” appropriations, Republicans propose spending about $75 billion less than the President in fiscal year 2016. Over the next decade, the Republican proposal aims to cut about $5 trillion deeper than sequestration levels set in 2011. Both now and in the longer term, congressional Republicans state that their top priority is to limit federal spending, and they have targeted Obama’s priorities in the process: Obamacare, Dodd-Frank financial reform, Medicaid, Head Start, Pell Grants, disability insurance, education, food stamps, low-income tax credits, the EPA, renewable energy development and  job training. About 70 percent of these additional cuts affect low- and middle-income Americans.

The contrast between the two positions is apparent and demonstrates sharply different visions of the nation’s future priorities. 

Securing Compromise for Fiscal 2016

But the immediate task is not so daunting. For starters, there is strong support within the Republican Congress for fixing sequestration for defense. And while Obama and congressional Democrats have resisted the GOP’s proposal for increased defense spending without an equivalent increase for domestic programs, they do not oppose raising defense spending above sequestration caps. 

The immediate dispute is about whether to provide increased funding for the domestic spending priorities of the Democrats, which total only about $37 billion for 2016. Almost half this amount represents the President’s priorities for health care, education, and job-training programs. The Republican proposal would prohibit the use of any funds for Obamacare, which means refighting the futile 2013 federal government shutdown fiasco all over again. While this proposal may have been necessary to satisfy the party’s base, it will not be given serious consideration in the year-end negotiations. The matter is settled, and congressional Republicans will receive no consideration for yielding on this point.

The obvious path to compromise is the one followed to date by congressional Democrats, which is to deny support for the increased defense spending sought by most Republicans absent support for the Democrats’ priorities. Once agreement is reached on this point (which was the basis for compromises in both 2011 and 2013), the rest will involve deciding which of the Democrats’ priorities will make the cut, given the funding provided. 

So, for example, if the sides agree to fund half the President’s proposed increases for both defense and domestic programs, the increase for 2016 will total about $38 billion with $19 billion for each. Of course, face-saving provisions can be applied, like agreeing to extend sequestration out another year or various revenue-raising enhancements not labeled taxes.

Coast Guard Funding Illustrates the Likely Outcome

In re-racking Obama’s priorities, a review of the proposals for funding the Department of Homeland Security (DHS) and the Coast Guard illustrates how congressional Republicans are asserting their priorities. While cutting the President’s request for DHS by about $2 billion, including deep cuts to agencies like U.S. Customs and Border Protection (CBP) and U.S. Immigration and Customs Enforcement (ICE), Republicans expressed strong support for the Coast Guard and increased the service’s budget significantly above the President’s request. 

Even House Republican appropriators, who are notoriously stingy when it comes to the Coast Guard, approved almost $300 million more than requested by the President to fund expensive new acquisitions, including the new Offshore Patrol Cutter program and another HC-130J long-range aircraft. Senate Republican appropriators, the traditional guardians of the service’s budget, added over $730 million more than requested for acquisitions, including a ninth National Security Cutter. Given this support in Congress, the likely result in the current year-end budget clash will be solid funding for the service above the President’s request.

The Coast Guard example illustrates that proposed increases for key constituencies served by congressional Republicans will likely be part of the ultimate compromise. So a final agreement may lie in increased spending, not sequestration. – MarEx