Romina Boccia, Katherine Thompson, and Benjamin Giltner
Republicans have one remaining reconciliation bill before the midterms. They should use it to prove they’re serious about reining in excess federal spending and fixing the debt, rather than embracing a “go small and go home to campaign” approach (as coined by the Wall Street Journal editorial board).
That means offsetting any new spending with meaningful reforms that reduce waste, fraud, and abuse in federal welfare programs, reining in deficits by slowing the growth of entitlement spending, and easing the inflationary pressures and rising interest costs that excessive federal borrowing imposes on American families. At a minimum, Congress should deliver the $600 billion in savings House Republicans pledged in last year’s reconciliation framework but ultimately failed to achieve.
If Republicans truly wanted to put the budget on a more sustainable path, by, for example, living up to their aspiration of reducing deficits to 3 percent of GDP (gross domestic product), they would go big before they go home. The bill pays mere lip service to that goal but offers no credible path to get there.
Instead, this plan merely unlocks reconciliation to finance an unpopular and unauthorized war, compensates agricultural interests harmed by the administration’s foreign policy before the midterm election, and provides subsidies to states for voter citizenship verification, while ignoring the structural spending reforms needed to restore the integrity of welfare programs and fiscal discipline.
House Budget Committee Chair Jodey Arrington (R‑TX) tried to reassure fiscal hawks by claiming the administration’s “war on fraud” will somehow offset the bill’s costs. Vice President JD Vance echoed that argument. Republicans shouldn’t be fooled twice. DOGE was also sold as the answer to Washington’s fiscal problems; now the same promises are being repackaged under a “war on fraud.” Fraud reduction is worthwhile, but it is no substitute for the spending reforms needed to put the budget on a sustainable path.
Funding an Unauthorized and Unpopular War
Katherine Thompson and Benjamin Giltner
This latest reconciliation package will spend upwards of $60 billion in taxpayer dollars on defense to continue the unauthorized war with Iran. Congress plans to consider such funding without clarity on the Trump administration’s remaining objectives and for a defined endgame. The funds for critical munitions replenishment come with no strategic safeguards to ensure greater prudence in drawing down US stockpiles going forward. Though the estimated $60 billion is less than the White House’s requested $67.1 billion, this amount would supplement the current $1.1 trillion being considered in the FY 2027 Defense Appropriations Act, bringing the total for the Pentagon alone to $1.16 trillion. Because this amount excludes any additional emergency war supplementals, other national security spending (such as for nuclear weapons), and the interest costs associated with borrowing to finance defense, this estimate is conservative.
Additionally, one political party shouldn’t have unilateral say over the entirety of our nation’s defense budget. The Founders gave Congress the power of the purse, but certainly not with the intent that the majority party rig the entire process from start to finish and box out the minority. A durable defense budget demands a strong political consensus.
As Americans struggle with the costs of living, and fiscal instability grows, pumping more money into defense is imprudent policymaking.
Farm Subsidies to Compensate for Bad Policy
David Ditch
Former Senior Analyst in Fiscal Policy at the Economic Policy Innovation Center and The Heritage Foundation
The House Budget Committee’s latest budget contains instructions for the House Agriculture Committee to spend up to $12 billion through the reconciliation process. It is broadly assumed that this would facilitate another round of subsidy payments to the farm sector.
While farms do face economic pressures such as rising prices for inputs and reduced exports to certain countries, these are primarily the result of federal policy choices on trade and foreign policy. It would be better for Congress to address the root causes, such as reining in the Trump administration’s destructive trade war, rather than seeking to use deficit spending to paper over the damage.
Further, American farms already receive heavy subsidization, have bankruptcy rates of roughly 1 in 10,000 per year, and farm programs are riddled with fraud and improper payments. Farming operations often receive multiple rounds of subsidies each year through standard and ad hoc programs. Rather than functioning as a safety net, subsidy programs often provide businesses with reliable annual income from taxpayers; some 9,000 farms have received payments for 41 years in a row. Another $12 billion would primarily benefit secure enterprises that already receive too much public assistance.
Congress Keeps Falling Short
The disappointing scope of this reconciliation package is yet another reason why I have lost confidence in our political parties to find the courage to fix the debt crisis. If Republican legislators cannot muster the political will to pursue commonsense measures to address fraud, waste, and abuse in federal welfare programs through reconciliation, they are even less likely to tackle the structural reforms needed in Social Security, Medicare, and Medicaid.
That is precisely why Congress should establish an independent, BRAC-like fiscal commission. By empowering independent experts to develop a comprehensive package of entitlement reforms with clear fiscal goals and expedited procedures, Congress can overcome the political paralysis and special interest pressures driving us off the fiscal cliff.
If Congress cannot use its final reconciliation bill before the midterms to deliver meaningful deficit reduction, it has demonstrated once again why the nation’s most difficult fiscal decisions need a better process, not more empty promises.
