Ho, Ho, Ho! Shutdown looming!

January 2, 2018 NTEU280

From our government budget and politics contact. Looks like a game of chicken is unfolding. Democrats and Republicans are both saying that a government shutdown will hurt the other guys more than their side. As a result, it's looking more likely that January 19 will roll around without a budget or continuing resolution (CR). Hopefully cooler heads will prevail. Read on for more detail from our budget contact....

Spoke to a lobbyist friend earlier today who is being assured by Schumer staff that he and Pelosi won't cut a deal with an "insufficient" NDD (non-defense discretionary) cap for FY 2018, and "definitely will not agree to any two-year deal that does not give NDD parity." Schumer and Pelosi seem willing to force a shutdown rather than accept recent Republican offers on NDD. They remain convinced Rs will be blamed for any shutdown. While this sounds good, it suggests Schumer and Pelosi may not get full NDD parity for FY 2018, despite their insistence on this as their negotiating position. The good news is they won't cut a two-year deal at less than parity. That could be an empty promise as a two-year deal now seems unlikely. Why would Republicans sign on to two years of parity? Why would Dems accept a two-year deal at less than parity, given the pressure Schumer and Pelosi are under to deliver for their base? Combining a DACA (Deferred Action for Childhood Arrivals) fix with the spending bill almost assures Schumer and Pelosi will come up short on NDD parity for FY 2018. It would be great if Congress could pass a DACA bill separately, Some R moderates want this, but their leaders and conservatives are determined to show strength on immigration by opposing any path to citizenship for Dreamers. Trump seems less set against some form of DACA fix, but is demanding huge wall/border security funding as part of this deal. A separate DACA bill would preserve Democrats' leverage in the budget deal - another reason Republican leaders are not enthusiastic about this approach. There is so little time between now and Jan 19th that it will be very difficult for Congress to develop and pass, or make substantial progress on, a stand-alone DACA fix before the current CR expires. Mulvaney has OMB (Office of Management and Budget) on target to deliver a devastating FY (fiscal year) 2019 budget proposal which the White House (WH) thinks they can get their Republican Congress to pass. WH plans to sell this package as "the best chance" to lock in Republican spending and policy priorities before November. They think it will help turn out their base and guarantee R wins in the mid-term elections. This strategy may not make sense given how nervous many Rs are about their re-election prospects. Passing an unrealistically tight budget could hurt them with moderates and independents. But White House strategies are not necessarily based on reality. The "Say it strongly enough and it will happen - Only talk about good news" mindset continues to prevail at the White House. For this reason, I doubt much progress will be made tomorrow. Trump has loaded the negotiating table with Administration types who love the Mulvaney budget. Some Rs and a few in the White House (including the President) are convinced a government shutdown will be good for Republicans. I hope I am wrong about this and we get a reasonable deal by Jan 19. If we do get such a deal, Congress may still need additional time to get the omnibus together. This translates to another short term CR into February to allow time for a deal to be translated into a full year appropriations bill. Remember that bill will include some goodies traded for R votes for tax reform. Appropriators are trying to figure out how to deliver on those promises without violating rules against earmarks. Savvy Republicans are wary of letting the time frame for approps negotiations slip into March when the debt ceiling will complicate Republican vote arithmetic. Several agency reps are expecting another short term CR while preparing for shutdown one more time.