Following a report in National Review Online, a relatively obscure provision in the Ryan–Murray budget deal has become a major point of dispute between proponents and critics of the deal.
NRO first reported that the agreement includes language eliminating the ability to raise a budget “point of order” in the Senate that sets a 60-vote threshold to offset a spending increase with new taxes.
That much — that the budget deal removes points of order under certain circumstances — is undisputed by all sides.
Senator Jeff Sessions of Alabama, the ranking member of the Senate Budget Committee, has said this language “legitimizes tax and spend.” But the authors of the deal, House Budget Committee chairman Paul Ryan and Senate Budget Committee chairman Patty Murray, have sought to downplay the importance of this point of order in the arsenal of weapons available to the Senate minority to stop tax increases.
Murray’s office has noted that other points of order, which are specific objections available to senators that require a set amount of votes to overcome, are also available under certain circumstances.
The Washington Post’s fact-checker, Glenn Kessler, also weighed in, primarily citing the input of Steve Bell and G. William Hoagland from the Bipartisan Policy Center to assess the claim as deserving of three “Pinocchios.”
The extremely technical nature of the debate ensures that there are only a few hundred people — perhaps a few dozen — with the expertise to speak knowledgeably about the matter. But as I have continued to discuss this with the top experts in Senate procedure, it has become even more clear that Sessions’s objections have merit — and could possibly result in the “worst-case scenario” of a tax increase passed through the Senate with only a bare-majority vote.
First, some background. A congressional budget sets spending limits by “function,” or purpose. Under normal rules, spending is capped by the Budget allocation for that function. If the cap is reached, the only way to increase spending for any given area would be to cut spending somewhere else in the function.
Enter the “Deficit Neutral Reserve Fund.” These funds, known in budget parlance as DNFRs, offer committee chairmen flexibility to spend more money than the budget caps — specifically, by allowing them to raise new taxes to pay for the new spending, rather than cutting other spending.
“Those reserve funds give committees more leeway in terms of finding ways to pay for things,” says Cheri Reidy, the retired former staff director for Senator Judd Gregg on the Budget Committee. “Without a reserve fund, you would have to pay for spending increases with spending cuts in your own jurisdiction. With a reserve fund, you don’t necessarily have to do that. You can pay for them with tax increases,” says Reidy, who worked for the budget panel for 29 years.
In the Ryan–Murray deal, there are dozens of DNFRs covering all different sorts of topics.
The DNFR that is potentially the most dangerous to Republicans allows flexibility vis-á-vis the sequestration budget caps of the Budget Control Act. That DNFR makes it impossible to raise what’s called the ”302(f)” point of order to enforce the rule against using tax increases to pay for for spending above the caps.
Murray’s office, working with Ryan aides to dismiss criticism about the provision, has assured reporters that other points of order will always remain in play for Republicans to object to such a bill.
One such objection available is the “306″ point of order, which says any bill that comes under the purview of the Budget Committee must be reported, or approved, out of the Budget Committee.
It’s easy enough to send a bill through the Budget Committee. But any bill that would “pay for” busting the sequestration caps faces a kind of Catch-22: Because of the “origination clause” in the Constitution, all tax bills have to originate from the Ways and Means Committee. After passing the House, such a bill would be referred to the Senate Finance Committee. From there it would go to the Senate floor, where Sessions could raise the 306 point of order, establishing a 60-vote threshold through another means because it hadn’t come through the Budget Committee.
However, Sessions and his staff at the budget committee fear Democrats could work around the 306 objection fairly easily: all they’d have to do is send a tax-related bill through the Budget Committee after it came out of the Finance Committee. Holding an actual Budget Committee meeting would require a 48-hour notice period, but Majority Leader Harry Reid may be able to avoid even that by ordering it reported “forthwith.”
Would it work? Sessions would undoubtedly raise the 306 objection anyway, prompting a ruling by the Senate parliamentarians. It’s unclear how they would come down on the issue, because the question is unprecedented.