Speaker Nancy Pelosi told reporters on Friday that she supports permanent legislation to ensure that government shutdowns never happen again. Broadly speaking, Pelosi wants legislation providing that “any appropriations bill that does not get agreed upon within a timely fashion by the date, you automatically go into a CR” — a “continuing resolution” that maintains current spending levels.
Basically, Pelosi would replace the current default rule — that government funding is zeroed out in the absence of a law appropriating money — with a new rule that government funding remains constant until it is explicitly changed by Congress. Done right, this proposal could eliminate the shutdown as a tactic rogue elected officials can use to extort concessions from the opposing party. Done poorly, however, such legislation could make matters worse.
There is, however, a clear way to ensure that shutdowns never happen again. Current law allows the Republican Party to take federal workers hostage whenever they want to enact policy that Democrats oppose. A new law could change this power dynamic, effectively forcing Republicans to choose between funding the government and imposing higher taxes on their wealthiest donors.
The problem of inflation
There’s a fairly simple reason why legislation that simply continues existing funding levels during a budget dispute is a bad idea.
I hope @SpeakerPelosi will consult with some progressive budget wonks on this. Automatic "flat-funding" is actually a cut in disguise (because of inflation and population growth). A law that perpetuates "current levels" would be easy for right-wingers to take advantage of. https://t.co/La85e74W7L
— Michael Linden (@MichaelSLinden) January 27, 2019
As Michael Linden points out, a dollar of government spending tomorrow is worth less than a dollar of government spending today. Though inflation rates fluctuate, a law that leaves current spending levels in place indefinitely would effectively reduce government spending by 1.5 to 2 percent in a typical year.
That would mean that the only thing Republicans who wish to slash government funding would need to do is block new appropriations and wait.
Indeed, this tactic of using inflation to unwind government programs is a common feature of Republican policy proposals. In 2011, then-House Budget Chair Paul Ryan (R-WI) proposed repealing Medicare and replacing it with a voucher to help seniors buy private insurance. Under Ryan’s original proposal, this voucher would gain value more slowly than the rate of health inflation — meaning that it would lose real value over time. According to the Congressional Budget Office, “by 2080, Medicare would be cut 76 percent below its projected size” if the Ryan plan had taken effect.
In fairness to Ryan, he later stepped away from this proposal to phase out Medicare through inflation after it triggered a public outcry — although he never abandoned his broader proposal to replace Medicare with a voucher. In 2016, moreover, Ryan proposed using a similar inflation-driven proposal to phase out Medicaid.
Republicans, in other words, are well aware of the power of inflation as a way to undercut government programs. They would be likely to take advantage of any shutdown prevention legislation that does not account for this problem.
Republicans are the problem
Setting aside the problem of inflation, any proposal to eliminate government shutdowns has to confront a simple reality — government shutdowns are not a tactic that #bothsides deploy evenly. With one exception that, if anything, drives home the point that shutdowns are a GOP-driven phenomenon, every shutdown for the last quarter century was triggered by Republicans seeking to extort policy concessions from Democrats.
Since Republicans gained control of Congress two years into the Clinton presidency, there have been five government shutdowns (six if you count an overnight shutdown that lasted less than 9 hours last February).
The two Clinton era shutdowns — one of which spanned five days in November of 1995 and the second spanned 21 days in late 1995 and early 1996 — arose from Republican efforts to cut programs such as welfare, Medicaid, and Medicare. President Clinton initially vetoed these cuts, and the two shutdowns eventually ended with Republicans accepting the kind of federal budget that they could have gotten without a shutdown.
As NPR reported, the eventual deal between Clinton and congressional Republicans was “similar to what was on the table before the shutdown, with cuts to federal spending (though smaller than Republicans had originally demanded) and a path to a balanced budget.”
These shutdowns also began for a more petty and personal reason. A few days after the first shutdown began, then-Speaker Newt Gingrich (R) told reporters that he demanded spending cuts that Clinton would not agree to in part because he felt snubbed by the president during an Air Force One flight to Israel.
“This is petty,” Gingrich admitted at the time, “[but] you land at Andrews [Air Force Base] and you’ve been on the plane for 25 hours and nobody has talked to you and they ask you to get off the plane by the back ramp. . . . You just wonder, where is their sense of manners? Where is their sense of courtesy?”
Gingrich’s admission was widely mocked — most famously by a New York Daily News cover labeling him a “CRY BABY.” It also left little doubt about who was to blame for the government shutdowns.
Similarly, in 2013, Republican hardliners led by Sen. Ted Cruz (R-TX) shut down the government in a failed effort to defund the Affordable Care Act — Cruz later bragged that one impact of this shutdown is it allowed him to add two million names to his political action committee’s email list. And, immediately before he triggered the recently ended shutdown, Trump bragged that he’d be “proud” to shutdown the government in order to force Democratic concessions on border policy.
The pattern in all four of these shutdowns is that Republicans wanted to make policy changes that they could not secure through the ordinary legislative process, so they decided to shut down the government in an attempt to force Democrats to give them what they wanted.
The one possible exception to this pattern is a very brief shutdown that lasted a single weekend in January of 2018. That shutdown arose after Trump appeared open to a deal that would have funded his Mexican border wall and given permanent protection to undocumented immigrants who came to the United States as children.
After the White House pulled out of this deal, Democrats briefly refused to provide the votes needed to keep the government open unless the budget deal included protections for these immigrants.
Yet, whatever you think of Democratic tactics during this brief impasse, the fact remains that the shutdown began on a Saturday and Democrats decided to end it the following Monday. In the end, Democrats stopped the shutdown themselves. They did not need outside pressure to abandon this tactic.
All of this recounting of history is a long way to say that, if Congress enacts legislation permanently ending shutdowns, that legislation should target the causal root of those shutdowns — the Republican Party. Any legislation seeking to prevent shutdowns should impose asymmetrical pressure on Republicans to encourage them to come to the bargaining table quickly.
One possibility is a law providing that, for each week that Congress fails to pass appropriations, marginal tax rates on Americans earning more than a million dollars a year will automatically increase by one percent. That way, a powerful Republican constituency will have a major incentive to end the shutdown, and Republican lawmakers will be pushed into a weaker and weaker bargaining position the longer the shutdown continues.
Autopilot is bad
One advantage of a bill that imposes consequences that Republicans would hate every time there is a shutdown — as opposed to simply continuing funding until appropriations bills become law — is that there is a very real cost to running the government on autopilot.
The annual budgeting process is important. The mix of government programs that made sense in 2018 aren’t necessarily going to make sense in 2032. Government needs to have the ability to try out pilot programs without continuing those programs indefinitely if they don’t work. New industries emerge, which may require the government to hire additional regulators to monitor those agencies. Other industries may atrophy, eliminating the need for government employees overseeing them.
An annual budgeting process forces the government to continuously ask if the way we spend money now makes sense. Put the government on autopilot, and we will waste a lot of money on useless programs while failing to expand beneficial ones.
That’s probably a better outcome than a world where Republicans regularly shut down government as an act of extortion, but it is hardly an ideal world.
There’s also a constitutional limit on Congress’ ability to put government on autopilot. Under Article I of the Constitution, Congress may spend money “to raise and support armies,” but “no appropriation of money to that use shall be for a longer term than two years.” So, while much of the government spending could be automated, the defense budget will still need to be reevaluated every two years.
Yet, despite these logistical challenges, permanent legislation preventing shutdowns is a worthy goal. The trick is to design this legislation so that it brings malign actors to the table.