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Staff Contact: Russ Vought (x68581) April 6, 2006

DRAFT

Policy Brief

H.Con.Res. 376 \-- Concurrent Resolution on the Budget for Fiscal Year
2007

**Order of Business**: Consideration of H.Con.Res. 376 is scheduled to
continue on Thursday, April 6, 2006. The Rules Committee has not yet
reported out a rule making in order substitutes by the Democratic
Leadership (Spratt), the Republican Study Committee (Hensarling), the
Tuesday Group (Castle) or the Congressional Black Caucus (Watt).

**Comparison of Budget Substitutes**

**Increase or Decrease in Federal Taxes**:

> Compared to the CBO Baseline (which does **NOT** assume the extension
> of current tax rates)
>
> Negative Number Signifies Tax Relief, Positive Numbers Are Tax
> Increases

# 

# In Billions of Dollars

  ---------------------------------- ----------------- -------------------
  **PROPOSAL**                       **2007**          **2007-2011**

  Committee Budget                   -39.0             -227.8

  RSC                                -60.4             -630.2
  ---------------------------------- ----------------- -------------------

**Total On-Budget (Excludes Social Security) Spending, Excluding
Interest Payments:**

Interest payments are excluded so as to show the levels of programmatic
spending.

# In Billions of Dollars

  ---------------------------------- ----------------- -------------------
  **PROPOSAL**                       **2007**          **2007-2011**

  Committee Budget                   1,929.089         10,197.812

  RSC                                1,845.588         9,296.126
  ---------------------------------- ----------------- -------------------

NOTE: This analysis does not look at the funding suggested for the
separate functional categories. For discretionary spending, the
Appropriations Committee is not bound by the functional suggestions in
the Budget Resolution. For mandatory spending, only reconciliation
proposals to change existing law or the relevant Committee Allocation
(302(a) allocation) made in accompanying Committee Report are of real
relevance. Many budget reform proposals have suggested eliminating most
of the functions.

**On-Budget Deficit (Excludes Social Security):**

# In Billions of Dollars

  ---------------------------------- ----------------- -------------------
  **PROPOSAL**                       **2007**          **2007-2011**

  Committee Budget                   -543.2            -2,247.1

  RSC                                -503.9            -1,792.3
  ---------------------------------- ----------------- -------------------

**Unified Deficit (Includes Social Security):**

# In Billions of Dollars

  ---------------------------------- ----------------- -------------------
  **PROPOSAL**                       **2007**          **2007-2011**

  Committee Budget                   -348.1            -1,091.2

  RSC                                -308.0            -628.4
  ---------------------------------- ----------------- -------------------

**Include \$50 Billion Defense Reserve Fund for On-going Military
Operations:**

  ----------------------------------------------- -----------------------
  **PROPOSAL**                                    

  Committee Budget                                YES

  RSC                                             YES
  ----------------------------------------------- -----------------------

**Mandatory Spending Reconciliation, Reserve Funds:**

[Committee Budget:]{.underline}

-   \$4.3 billion "rainy day" fund for non-military emergencies (with
    enforcement language).

-   Reconciliation instruction*:*

> *Savings*

##  Dollars in Millions

  ------------------------------------ ----------------------------------
  **Committee**                        **Five Years**

  Agriculture                          55

  Armed Services                       175

  Education & Workforce                1,323

  Financial Services                   400

  International Affairs                250

  Judiciary                            500

  Transportation                       50

  Ways and Means                       4,000

  **Total**                            **6,753**
  ------------------------------------ ----------------------------------

[RSC:]{.underline}

-   Deficit-neutral reserve ("rainy day") fund for non-military
    emergency spending and military emergency spending after FY 2007.
    The rainy day fund is deficit-neutral so that offsets will be found;
    other rainy day funds (the Committee budget or the Tuesday Group
    budget) do not require the emergency spending to be paid for.

-   Reconciliation instruction:

> *Savings*

##  Dollars in Millions

  ------------------------------------ ----------------- ----------------
  **Committee**                        **First Year**    **Five Years**

  Agriculture                          2,083             29,116

  Armed Services                       52                120

  Education & Workforce                1,010             7,470

  Energy & Commerce                    1,125             91,697

  Government Reform                    140               1,670

  Resources                            0                 6,793

  Transportation                       32                230

  Ways and Means                       27,457            221,189

  **Total**                            **31,867**        **358,055**
  ------------------------------------ ----------------- ----------------

**Enforcement Provisions:**

[Committee Budget:]{.underline}

-   Restriction on advanced appropriations

-   Requires spending designated as an emergency to meet the criteria
    for emergency spending

[RSC:]{.underline}

-   Restriction on advanced appropriations

-   Turns off the Gephardt Rule which currently allows for an increase
    in the public debt limit equal to levels set forth in the budget
    resolution.

-   Requires spending designated as an emergency to meet the criteria
    for emergency spending. This provision is enforced via a point of
    order, and if the point of order is waived, a point of order lies
    against the rule waiving the point of order.

-   Creates Budget Protection Direct and Discretionary Accounts to allow
    Members to reduce spending and ensure that it is spent either on
    deficit reduction or tax relief---and not on increased spending
    elsewhere in the federal budget.

-   Prohibition on using general tax increases to offset new spending in
    an effort to comply with the Budget Resolution.

-   Creates a new supermajority (three-fifths) point of order against
    new direct spending while exempting any bill to preserve Social
    Security that may include short-term transition costs.

-   Allows for tax cut levels to be increased to take into account the
    economic feedback from lower taxes based on realistic (dynamic)
    scoring.

**Senses of the House / Congress:**

[Committee Budget:]{.underline}

-   Long-term budgeting

-   Closing the tax gap to reduce the deficit

[RSC:]{.underline}

-   None

**\###**