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InsiderOnline Blog: February 2012

The Budget Control Act Is Not Much of a Control

Federal discretionary spending for 2012 will exceed the caps in the Budget Control Act by about $156 billion, says the Congressional Budget Office’s latest outlook. Patrick Louis Knudsen breaks it down (“FY 2012 Spending Blows Through Cap, CBO Shows,” The Heritage Foundation, February 8, 2012):

The one defensible exception to the cap, about which Congress was forthright, allows an adjustment for U.S. activities in Iraq and Afghanistan, known as Overseas Contingency Operations (OCO), totaling $127 billion. By their nature, these operations are temporary and funded year by year, with amounts determined by conditions in the theater. […] It is still real spending and should be accounted for, but a spending cap exception for these activities is at least understandable. […]

Two of the more egregious loopholes are for “disaster” funding and certain “program integrity” initiatives, which total about $11 billion in the FY 2012 spending bills.

The roughly $10.5 billion in disaster funds provided in the appropriations bills go toward relief from weather events that have already happened, such as Hurricane Irene and even Hurricane Katrina of six years ago. The legal definition for what qualifies as a disaster comes down to pretty much whatever the President says it is—and the current President has been extravagant about it. […]

[T]he appropriators also employed the zoologically named gimmick known as CHiMPs, short for “changes in mandatory programs.” In this maneuver, appropriators make one-time reductions in entitlement programs—not normally in their jurisdiction—and apply the “savings” to their annual appropriations bills. This allows them to hide higher spending on the discretionary side. […]

In their FY 2012 spending bills, appropriators employed $18 billion worth of CHiMPs, allowing them to spend another $18 billion above the BCA cap. The CHiMP savings are temporary, but the discretionary spending increase is permanent.

Posted on 02/10/12 01:36 AM by Alex Adrianson

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