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House conservatives' push for steep spending cuts riles Democrats, revives shutdown talk

Treasury Department data shows federal government spent $6.27 trillion in fiscal year 2022, collected $4.90 trillion in revenue, resulting in $1.38 trillion deficit

Published: June 16, 2023 5:48am

Updated: June 16, 2023 2:52pm

The fallout among the House GOP conference from President Biden and House Speaker Kevin McCarthy's debt limit agreement that shuttered the House floor last week could have a second act as the government nears another shutdown deadline.

Last week, a group of House conservatives blocked legislation from advancing on the floor, in part, due to their opposition to the Biden-McCarthy deal, arguing that it didn't go far enough to reduce federal spending.

As a concession to the House Republican conference's most conservative wing, appropriators are expected to propose federal spending levels lower than the threshold in the Biden-McCarthy deal, which Democrats are already speaking out against.

"This moves us in the direction of, you could say a CR [continuing resolution], but in October, we’re looking toward a shutdown," Connecticut Rep. Rosa DeLauro, the top Democrat on the House Appropriations Committee, recently said.

California Rep. Pete Aguilar, chairman of the House Democratic Conference and a member of the House Appropriations Committee, shared a similar assessment about the prospect of a shutdown.

"This is an agreement that the speaker made directly and he took pains — remember? — to get everybody else out of the room and to get to a deal with just him and the president. And now he’s walking away from that deal,” Aguilar said. “If it wasn’t so dangerous, it would be laughable."

Fiscal year 2024 spending cannot exceed fiscal year 2023 funding levels under the Biden-McCarthy deal. Beyond that, domestic spending cannot grow more than 1% each year.

McCarthy has said the spending caps in the debt limit deal don't prohibit the House Appropriations Committee from passing a bill under the limit.

"You always have to remember with appropriation levels – that’s your cap," he said. "You can always do less."

House Appropriations Committee Chairwoman Rep. Kay Granger said she intends to put forth funding bills that do not exceed fiscal year 2022 spending levels.

"The Fiscal Responsibility Act set a top line spending cap – a ceiling, not a floor – for Fiscal Year 2024 bills,” said Granger, a Texas Republican. "That is why I will use this opportunity to mark up appropriations bills that limit new spending to the Fiscal Year 2022 top-line level.”

So far, Granger's parameters for domestic appropriations come in at about $119 billion less than the spending limits in the debt limit agreement.

The House Appropriations Committee formally adopted subcommittee spending allocations on Thursday under the caps in the debt limit agreement in a 33-27 vote. 

Granger said spending reductions are needed after "years of out-of-control spending" through the COVID-19 pandemic, which sent the deficit and debt to record highs.

Aguilar predicted that the Democratic-led Senate would ignore any appropriations bills that come in under the caps set in the debt limit agreement.

"It has no possibility of becoming law," he said. "These are the deals that Kevin McCarthy has to make in order to hold the gavel."

According to Treasury Department data, the federal government spent $6.27 trillion in FY2022 and brought in $4.90 trillion in revenue, which resulted in a deficit of $1.38 trillion.

The national debt is almost $32 trillion. 

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