Committee for a Responsible Federal Budget

‘Line’ Items: Draft Edition

Budget Resolution Drafted – The NFL isn’t the only entity that made key decisions for the future last week. On Thursday the Senate Budget Committee approved a FY 2011 budget resolution on a mostly party line 12-10 vote. It goes farther than the President’s budget request in aiming to reduce the deficit to 3 percent of GDP in 2015. The Bottom Line noted that this is a step in the right direction, though much more needs to be done. It is not clear if the resolution will hear its name called on the Senate floor or in the House. A busy legislative calendar and election year anxiety over highlighting the bleak fiscal outlook may mean a budget blueprint stays on the board this year.

Fiscal Commission to Begin Work – With its team in place, the commission appointed by President Obama to tackle the budget deficit will kick off its season tomorrow with its first meeting. The President himself will give the group a pre-meeting pep talk. The National Commission on Fiscal Responsibility and Reform has a tough schedule ahead, tasked with producing recommendations by December 1 of this year that are agreed upon by at least 14 of the commission’s 18 members for reducing the annual federal budget deficit to 3 percent of GDP by 2015 and improving the long-term fiscal outlook. CRFB today called for all sensible options to be on the table as the commission deliberates.

Bank Tax Projected to Be an Early Pick – Forced by pay-as-you-go rules to find offsets for new spending, lawmakers are keen to fill holes in their legislative rosters to pay for their proposals. A fee imposed on the largest financial institutions is looking like a winner. Senate Finance Committee Chairman Max Baucus (D-MT) told Politico that “I don’t think there’s much doubt that there will be a bank tax.” The debate appears to be over what to do with the proceeds, with some arguing that the revenue should be used to pay down the debt, as opposed to financing new spending. Ranking Member Charles Grassley (R-IA) made this point at a Finance Committee hearing on the issue last week.

National Fiscal Summit This Week – Deficit hawks will gather this week for a combine of sorts to assess strategies for addressing the mounting debt. The 2010 Fiscal Summit: America’s Crisis and A Way Forward, hosted by the Peter G. Peterson Foundation in Washington, DC will feature blue chippers such as former President Bill Clinton, former Federal Reserve Chairmen Alan Greenspan and Paul Volcker and OMB Director Peter Orszag.

Earmark Reform Declares – Congressman Bob Goodlatte (R-VA) last week introduced a “sense of the House” resolution calling on Democrats to follow Republicans in banning earmarks for a year, reducing discretionary spending, and creating a bipartisan committee to review and overhaul the budgetary, spending, and earmark processes.

Financial Regulation Reform Not Taken in the First Round – An overhaul of the financial regulatory process failed this afternoon to advance in the Senate on a 57-41 cloture vote. Democrats will try again to get Republicans on board to get the 60 votes needed to proceed with debate.