2020 budget – USA Gov Policy

Congress returns to session this week, The House on September 9, The Senate on September 30.

With the Presidential election season rapidly moving ahead, expect political maneuvering to be even more vigorous than usual.

Two top issues the Democrats were relying on to gain votes have fallen flat. The entire “Russian Collusion” charge has been proven false, and has boomeranged against those who asserted it. The reality that key current and former members of the FBI and the CIA, allied with the Clinton campaign, conspired to alter an election and its aftermath is slowly sinking in to the public consciousness. Similarly, in a bid to secure female votes, various sexist-type charges levied against Supreme Court nominee Brett Kavanaugh turned out to be incorrect.

Democrats will now concentrate on gun control and environmental matters. In the wake of several mass shootings, sentiment to enact measures such as enhanced background checks will be a very visible factor in coming legislative discussions. Whether those measures will have any real-world impact is questionable.

The American Bar Association has emphasized education concerns: the “What You Can Do For Your Country Act (S.1203/H.R.2241 would allow borrowers of all federal loans to qualify for Public Service Loan Forgiveness, as well as borrowers enrolled in any federal repayment plan. The Paycheck Fairness Act would ban employers from asking job candidates about their salaries at previous jobs.

There is a growing interest in allowing greater access to protecting and expanding access to retirement savings. Lorie Konish, writing for CNBC notes: “ Congress…will have a slew of proposals to consider, including some that could have a big impact on your retirement. New proposals aim to fix legacy issues by expanding access to retirement savings, making Social Security solvent and protecting income in multi-employer pensions… The Secure Act… includes measures to allow small employers to band together to offer 401(k) plans, give part-time workers access to retirement plans, take away the 70½ age limit for individual retirement account contributions and raise the age for required minimum distributions to 72, from 70½. It also would expand the inclusion of annuities in 401(k) plans and put a 10-year time limit on how long non-spouse beneficiaries can stretch out an inherited IRA.

Other measures seek to ensure the solvency of the Social Security fund, and establish health care savings accounts for seniors. Expect more debate over campaign finance and environmental issues.

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Wrangling over the 2020 budget will be central to the Fall session.

Back in March, the White House submitted its $4.746 trillion budget proposal, which the Democrat-majority house declared “dead on arrival.” The major flash point was, and continues to be, the President’s push for more funds to extend the southern border wall, needed to stem the vast influx of illegal immigration. According to The Hill, “House Democrats have already pledged to oppose any push by the administration to loosen restrictions on border barrier funding. Border money as well as related spending like Immigration and Customs Enforcement are expected to be the two biggest hurdles to getting a spending deal.”

The Administration also seeks to increase defense spending. During the Obama years, as the U.S. cut Pentagon funding, both China and Russia committed significant additional monies to their militaries, and both Iran and North Korea moved ahead on their nuclear programs. One could say that Washington “Gave peace a chance,” but it didn’t work. Moscow now possesses the world’s strongest nuclear force, replete with new weapons. China now has a superpower-class military with technology that fully rivals America’s.

Other issues included in the White House budget were measures designed to combat the opioid epidemic; a proposal “to hold institutions of higher education accountable for results by requiring colleges and universities to share a portion of the financial responsibility associated with Federal student loans to encourage them to improve performance,” a move to modernize federal governmental technology,” and a ten percent increase in funds for the care of veterans.

The parties, already far apart on numerous issues, are not expected to reach an agreement before the October 1 deadline. Another “continuing resolution,” lasting until December, will probably prevent a government shutdown.

The White House has released its 2020 proposed Budget, which “lays out the President’s continued vision to drive down deficits by bringing spending below the post-war average while continuing to make investments in critical priorities.” Below, we present the Administration’s brief summary of key points.

2020 BUDGET FACT SHEET

GETTING THE NATION’S FISCAL HOUSE IN ORDER.

Even with high levels of economic growth, excessive deficits continue to threaten our progress, and any unforeseen shocks to the economy could make deficits unsustainable. Deficits matter; ask any family with a credit card. This Budget demonstrates the President’s vision to control Washington spending by prioritizing effective programs, and cutting wasteful or unnecessary uses of taxpayer dollars.

Sticks to the Current Law Discretionary Caps. For nearly a decade, the Budget Control Act of 2011 has imposed caps on discretionary spending. Since discretionary spending is a main driver of the Federal deficit in the near term, capping its growth is critical to securing a sound fiscal future. Congress has enacted three consecutive deals to raise the discretionary spending caps, the most recent of which increased spending levels for fiscal years 2018 and 2019 by nearly $300 billion. This Budget adheres to the spending caps in current law, and provides additional needed defense resources by designating these investments as Overseas Contingency Operations (OCO) funds. This is the only fiscally responsible option to meet national security needs while avoiding yet another unaffordable increase to the spending caps.

Cuts Wasteful Washington Spending. Overall, this Budget includes $2.7 trillion in spending cuts—higher than any other administration in history. As part of these cuts, the Budget meets the President’s directive to reduce nondefense programmatic spending by 5 percent below the higher 2019 cap level. It also proposes an aggressive set of policies to redefine the proper role of the Federal Government and curtail those programs that fail to efficiently and effectively deliver promised outcomes to the American people.

Gets Deficits Under Control. The proposals in this Budget would reduce total deficits from nearly 5 percent of GDP in 2020 to under 1 percent of GDP in 2029. Looking forward, long term policy projections indicate that the proposals in this Budget would put us on track to reach balance by 2034. This is a clear roadmap for a more fiscally responsible future if the Congress chooses to follow it.

CONTINUING INVESTMENTS IN KEY NATIONAL PRIORITIES.

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• Securing our Southern Border and Enforcing our Immigration Laws. The Budget proposes sizable investments in a border wall; border security technology and equipment; funding to hire additional Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE) law enforcement officers; and increased capacity to detain and deport illegal aliens. The Budget includes $5.4 billion in high priority investments at the Department of Homeland Security (DHS) in border security technology, infrastructure, and equipment to help CBP prevent, detect, and interdict illegal border crossings. It also includes $3.6 billion in new military construction resources at the Department of Defense to assist DHS in securing and managing the southern border. The Budget continues implementation of the President’s direction to hire 5,000 additional Border Patrol Agents and 10,000 ICE officers and investigators, and proposes $478 million to hire and support 1,750 additional law enforcement officers and agents at CBP and ICE. The Budget also includes $2.7 billion in total funding for 54,000 average daily ICE immigration detention beds.

• Preserving Peace through Strength and Supporting the National Defense Strategy. The Budget includes $750 billion for national defense. Of this total, $718 billion is for the Department of Defense (DOD) to fund the National Defense Strategy’s three lines of effort: rebuilding readiness and lethality; strengthening alliances and partnerships; and improving performance and affordability through reform. The Budget prioritizes strategic competition with China and Russia, while also sustaining efforts to deter and counter rogue regimes such as North Korea and Iran, defeat terrorist threats, and consolidate gains in Iraq and Afghanistan through a resource-sustainable approach.

• Protecting our Veterans. The Budget invests in world-class health care for our Nation’s veterans by including $80.2 billion in discretionary appropriations to fully fund the Department of Veterans Affairs (VA) medical care requirements in 2020. This funding level fully supports implementation of the historic VA MISSION Act of 2018 to provide veterans greater choice on where they receive their health care, whether at a VA facility or through a private health care provider.

• Ending the Opioid Epidemic. The Budget includes $4.8 billion in the Department of Health and Human Services to continue historic investments made in 2019 to combat the opioid epidemic by expanding access to prevention, treatment, recovery support services, and research. The Budget also includes actions that would prevent improper or abusive prescribing of opioids in Medicare and Medicaid, provides $330 million for opioid-related State and local assistance funding in the Department of Justice, and makes critical investments to the Department of Veterans Affairs to reduce over-reliance on opioids for pain management and to promote the safe and effective use of opioid therapy, and for addiction treatment.

• Investing in America’s Students. The Budget takes steps to ensure that Americans can receive the high-quality education and training they need to obtain a job and advance in their careers. The Budget proposes to hold institutions of higher education accountable for results by requiring colleges and universities to share a portion of the financial responsibility associated with Federal student loans to encourage them to improve performance. The Budget also continues to propose to expand Pell Grant recipients’ eligibility to include high-quality short-term programs, with sufficient guardrails in place to balance students’ needs with protecting taxpayers’ interests.

Quick Analysis

Russia Expanding Aggression

President Putin is using more than one pathway to enter Europe and undermine the West. While most of the world watches the conflict he initiated in Ukraine, the Russian government is actively pursuing a second front in a little noticed campaign in Cyprus. Although the corrupt Cypriot government ended its issuance of “golden passports” in 2020, Russian intelligence is functioning quietly there to transform this EU country into a Russian beachhead of illicit economic activity aimed at penetrating the capitalist West, according to Paul Goble of the Jamestown Foundation. Cyprus is not a member of the North Atlantic Treaty Organization (NATO) nor does it receive as much attention as those countries who are member states. That adds to its allure as a prime location for Russia to attempt to gain a European foothold. Last week a NATO report, cited in the European Daily Monitor, noted that Russian intelligence agents have been plotting to destroy European infrastructure across the continent to disrupt states supporting Ukraine. It further suggests that Putin’s immediate goal is to lay the framework for a future move against the security organization’s members. Hungary, in particular, is another country garnering Moscow’s attention as it opposes the Western response to Russian aggression. Russia is focusing its intelligence efforts on other European, non-NATO member countries in addition to Cyprus, including Austria, Malta, and Ireland. The NATO report suggests that Moscow has had success in disseminating the Russian political narrative in these states to advance its campaign against the West. The island of Cyprus is proving to be a good target for Moscow as it is an ethnically divided island that is part of the EU since 2004. Northern Cyprus, officially called the Turkish Republic of Northern Cyprus (TRNC), is a de facto state that is only recognized by Turkey. The division precludes it from joining NATO. As Goble suggests, “it offers Russia troubled waters in which to fish.” Over the last 20 years, he points out, Cyprus’ challenges have opened it to a massive influx of Russian citizens, who now comprise approximately 10 percent of the island state’s population. Over 2,900 residents are Russians who entered until the “golden passport” program that allowed wealthy or well-connected Russians to move to Cyprus. It also provided them with documentation to travel freely throughout Europe! Although less visible on the world’s radar than the war in Ukraine, Moscow is also being helped by Cyprus’ banks opposition to seizing Russian assets and its support in evading Western sanctions. Russia has placed tens of billions of US Dollars there for money laundering. It has been more than two years since a single Russian “diplomat” has been deported and, in fact, the Embassy has grown to over 300 staffers on this tiny island state of only 1.2 million people. The Russian embassy in Nicosia has advanced communications antennae on its roof and opened a consulate on the northern end of the island. Moscow’s Ambassador, Mura Zyazikov, is a lieutenant general in the FSB with no diplomatic experience. The FSB, SVR (Russia’s Foreign Intelligence Service), and GRU are actively using the island as a base of operations against NATO Member states, Israel, and other Western allies. Moscow backs pro-Russian political parties who in turn influence Cypriot decisions on education, language, and other issues. “Dmitry Khmelnitsky of the Dossier Center says that its findings should be of concern not only to Cyprus but to the West as a whole. Those who ignore what Moscow is doing because Cyprus does not follow the EU sanctions regime are missing something critical,” says Goble. “Cyprus does not seek to get rid of Russian agents and does not interfere with their work,” Khmelnitsky concludes, “despite the fact that what the Kremlin is doing is so clearly visible.” This has an impact not only on the small island but on the EU, NATO, and the West in general. Earlier this year the Moscow Times reported that when the FBI became more interested in Russian business and oligarchs in Cyprus, at least 10 of the major Russian businesses operating there left. Despite the government of Cyprus’ vow to implement plans for new sanctions against Russia, it continues to ignore Putin’s atrocities in Ukraine and to shield the wealth of the 50,000 wealthy Russian citizens and oligarchs residing there. Daria Novak served in the U.S. State Dept. Illustration: Pixabay