WASHINGTON (CN) — Congress is poised to take a bite out of the government’s cumulative deficit thanks to laws passed last year that decreased spending outlays by tens of billions of dollars, the Congressional Budget Office said Wednesday.
The nonpartisan budget watchdog predicted in its report that the total federal deficit would fall by roughly $10 billion between 2023 and 2033. That figure is the net effect of a forecasted $12 billion decrease in government spending on mandatory programs as well as a $2 billion decrease in revenue, the report said.
The projected deficit cuts are in stark contrast to a similar report published by the Budget Office in March 2023, which estimated that legislation from the previous session of Congress would add around $810 billion to the deficit.
Wednesday’s report credits the Fiscal Responsibility Act, a bipartisan measure raising the debt ceiling made law in June, as a major factor in slashing the cumulative deficit.
A compromise between Republican lawmakers and the White House, the legislation was aimed at sidestepping a first-ever federal default. The act also temporarily paused the government’s borrowing limit, and slapped limits on so-called discretionary spending — budget outlays not central to the basic functions of government.
The Fiscal Responsibility Act also contributed to the ouster for former House Speaker Kevin McCarthy last fall, as some Republicans framed the compromise measure as a victory for Democrats.
Despite that, the Budget Office said the debt ceiling measure will help reduce deficits from mandatory spending by roughly $8 billion over the next decade, citing its own cost estimate for the bill published last spring.
Wednesday’s report pointed out that some of the bill’s provisions reduced funding for mandatory programs by around $10.3 billion, offset only by rescinded funds for the Internal Revenue Service which decreased government revenue by roughly $2.3 billion.
The Budget Office acknowledged the 2024 National Defense Authorization Act as another contributor: Last year’s version of the annual defense appropriations bill is projected to shave another $1.5 billion off the deficit over the next ten years.
According to the office, that change is largely due to “anticipated transactions” in the defense portfolio, including the sale of U.S. submarines to Australia. The watchdog forecast that transaction would lead to a $2.8 billion reduction in mandatory spending from 2023 to 2033.
However, the Budget Office noted, the act also includes defense and foreign affairs outlays that would offset the reduced deficit by roughly $1.3 billion.
Other measures passed last year helped to push predicted deficit contractions to $10 billion, but those laws “will have much smaller budgetary effects,” the report said.
The budget watchdog’s deficit forecast comes just days after Congress agreed to approve a package of bills forming the bulk of government spending for the 2024 fiscal year. The legislation, known as a minibus, rounded out a monthslong budget battle on Capitol Hill that exposed deep partisan divisions and fed Republican party infighting.
All told, 2024 budget negotiations — which proceeded in fits and starts throughout the winter and into the new year — took roughly six months to complete, an agonizingly slow pace that leaves congressional appropriators staring down the barrel of another spending fight in September.
Partisan disagreement over government spending is what finally led to former Speaker McCarthy’s ouster last year. Now, his replacement, Louisiana Representative Mike Johnson, may be faced with a similar dilemma.
After pushing through a last-minute budget compromise with Democrats last week, the House speaker — with just five months of leadership under his belt — is facing a motion to vacate led by Georgia Representative Marjorie Taylor Greene.
It’s unclear whether Greene, a staunch conservative who has argued that Republicans are failing to leverage their slim House majority for political wins, will try to force a vote on a Johnson ouster. It’s also uncertain whether her GOP colleagues would vote to throw their party into yet another leadership crisis.
Both the House and Senate are on a two-week recess after approving the 2024 budget minibus.
Follow @BenjaminSWeiss
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.
Additional Reads
-
California legislative committee approves deepfake bill April 23, 2024 -
