After a late start caused by the delayed completion of the fiscal year 2017 spending process, congressional appropriators have begun moving fiscal year 2018 funding bills, including the Labor-HHS-Education measure that covers the National Farmworker Jobs Program (NFJP). The House version of the bill would cut NFJP by roughly $10 million to $72 million from the fiscal year 2017 level-funded amount of $82 million. Approved by subcommittee, the measure awaits full Appropriations Committee consideration. The Senate has not yet released its fiscal year 2018 legislation. The president earlier this year recommended to Congress that it terminate NFJP entirely.
Looking at the big picture, the House recently passed a fiscal year 2018 “minibus” appropriations measure that includes $658 billion for national defense, though the topline exceeds the spending cap set by the 2011 Budget Control Act by $72 billion.The bill would fund the Defense Department’s base budget at $584 billion and its Overseas Contingency Operations account at $74 billion. The base budget funding is $68 billion above what was enacted in fiscal year 2017 and $18 billion more than what the Trump Administration sought for fiscal year 2018.
The Senate Appropriations Committee announced recently, however, that it is writing a defense spending bill that, unlike the House version, adheres to the BCA in the hopes of hashing out a bipartisan deal to raise the caps. Such an agreement, like past agreements, could provide much-needed cap relief for non-defense discretionary program funding. Should that occur, NFJP will be in a much stronger position to win the appropriations it needs to continue providing the nation’s struggling agricultural workers the hand up they need to help themselves going forward.
By Daniel Sheehan
AFOP Executive Director
“There’s a certain philosophy wrapped up in the budget and that is — we are no longer going to measure compassion by the number of programs or the number of people on those programs.We’re not going to measure our success by how much money we spend, but by how many people we actually help.”
— White House OMB Director Mick Mulvaney
Welcome to budget season in Washington, D.C., when the projections for economic growth are rosy and inflation assumptions are flat.
This week it is President Donald J. Trump’s turn to recommend to Congress a spending and revenue plan that stresses his administration’s fiscal priorities. In doing so, he will communicate to the American people his vision for our nation’s future. Sadly, migrant and seasonal farmworker advancement will have no part in that future.
Before digging into the president’s fiscal year 2018 budget proposal, I would like to revisit our old friend Fiscal Year 2017. On May 5, 2017, a full seven months after the target date for enactment, the president signed into law the Consolidated Appropriations Act of 2017 as Public Law 115-31, bringing the unnecessarily delayed fiscal year 2017 appropriations process to an end. I say “unnecessarily delayed” because the final spending measure could have easily been passed late last year, but the new administration requested the process be put on hold. I am very happy to report that Congress level funded the National Farmworker Jobs Program (NFJP) for fiscal year 2017, making clear its support for the program at current spending levels. Those funds will become available to NFJP grantees July 1, 2017 and run through June 30, 2018. Congratulations to all NFJP farmworker-training organizations for their unwavering commitment to serving migrant and seasonal farmworkers and families, and for their continued outstanding successes in doing so.
Turning to fiscal year 2018 spending, President Trump sent to Congress today a budget plan that recommends deep cuts in non-defense discretionary spending to offset a massive increase in defense and homeland security funding. As a part of that plan, he would reduce Labor Department funding significantly, including the zeroing out of the NFJP line item. This is an unfortunate development, but not wholly unexpected given the administration’s recent efforts to eliminate NFJP funding in fiscal year 2017.
As you would expect, the anti-poverty community is vociferously opposed to the president’s plan. According to the Coalition on Human Needs:
The Trump Budget is … the most draconian budget in modern history. In so many ways, this budget breaks promises and deceives about its true impact. It disinvests in America. The basic living standards that everyone needs – enough food, health care, and housing – are shredded, not strengthened. The budget would massively transfer money that should be invested in all our people to a handful of millionaires and profitable corporations, through multi-trillions in tax cuts that would average $50,000 each for millionaires. (Read full statement here.)
In addition, the Center on Budget and Policy Priorities (CBPP) has blasted the president’s recommendations, calling them a path to a new Gilded Age, a term derived from Mark Twain’s novel The Gilded Age: A Tale of Today, which satirized an era of serious social problems masked by a thin gold gilding of the very wealthiest. As CBPP puts it:
President Trump’s new budget should lay to rest any belief that he’s looking out for the millions of people the economy has left behind. He proposes steep cuts in basic health, nutrition, and other important assistance for tens of millions of struggling, low- and modest-income Americans, even as he calls for extremely large tax cuts for the nation’s wealthiest people and profitable corporations.
This disturbing budget would turn the United States into a coarser nation, making life harder for most of those struggling to get by but more luxurious for those at the very top. Most Americans do not seek a new Gilded Age. And the budget is sharply at odds with what the president told voters he would do during his campaign. With this budget, the President betrays many voters who placed their trust in him.In fact, this stands as the most radical, Robin-Hood-in-reverse budget that any modern president has ever proposed. (Read full statement here.)
As an association, we have our work cut out for us. Yes, members are diligent about educating decision-makers about the continuing importance of, need for, and tremendous success of the federal farmworker program. And, yes, I have made sure that the administration and lawmakers have the necessary information about the program to preserve it going forward. And, yes, we continue to engage every way we can to ensure this vital mission – giving farmworkers a hand-up, not a hand-out, to a more stable and family-sustaining career – continues. That is our goal. We will not flinch in pursuit of it.
By Daniel Sheehan
AFOP Executive Director
The White House has announced the overall discretionary appropriations totals President Trump plans to include in his first budget request (for fiscal year 2018) later this year. The president will propose an immediate nine-percent increase in defense spending to $603 billion, offset by an aggregate 11-percent decrease in non-defense appropriations to $462 billion. White House Budget Director Mick Mulvaney said the $54 billion increase in defense spending is one of the largest increases in history, and that cuts to the topline non-defense number will be the largest proposed reduction since the early years of the Reagan Administration.
Before this plan can go into effect, Congress must first adjust the annual statutory caps on discretionary appropriations (enacted in the Budget Control Act (BCA) of 2011) prior to enactment of the yearly appropriations bills. Unless the spending caps are amended, another round of across-the-board sequestration cuts will automatically be ordered and will reduce defense spending back to the spending cap levels. The caps – one for defense and the other for all other discretionary spending – are already scheduled to decrease in 2018 by a combined $5.2 billion below the 2017 levels, as required by BCA. The aggregate cut in non-defense discretionary spending under the Trump plan, measured versus the FY 2017 cap level (by which the pending 2017 appropriations bills must abide) would be a reduction of about 11 percent in total.
However, DOL may see a different level of spending reductions. A senior Republican appropriator is quoted as saying that everyone knows that Congress is never going to cut Homeland Security and Veterans Affairs (indeed, President Trump has indicated that veterans funding may actually be increased), so you have to back those programs out of any assumptions of aggregate cuts in non-defense spending in order to determine the overall level of cuts in other non-defense programs. After Homeland and Veterans are held harmless, the aggregate cuts to the remainder of non-defense spending get even worse, to a reported total reduction of 14.1 percent.
Congressional Democrats are certain to oppose these massive spending reductions, but some Republicans, particularly those on the House and Senate Appropriations Committees, will oppose them, too. After all, they are the ones who have to try to write bills that can get enough votes to pass each chamber. In addition, Republicans on the various authorizing committees that oversee federal agencies may not like the proposed cuts either.
The way the traditional budget process is supposed to work is like this:
- The president submits a budget request, ideally in early February, but new presidents in their first year get a grace period.
- The House and Senate take the president’s overall spending and tax totals and priorities into consideration, then pass a congressional budget resolution that sets the spending and tax totals that will govern which bills can be considered in Congress for the remainder of the year. This resolution also gives the Appropriations Committees one big lump sum of money to spend in the upcoming year, which they subdivide as they see fit.
- The Appropriations Committees write their annual spending bills.
The BCA spending caps complicate the traditional process. No matter what discretionary spending levels the president proposes in his budget, and no matter what lump sum the congressional budget resolution gives to the Appropriations Committees, if total defense appropriations for the year exceed the BCA cap level, another round of sequestration is ordered to reduce defense spending back to the cap level. Similarly, if total non-defense spending exceeds the cap level, sequestration automatically cuts it back.
The $54 billion increase in defense spending proposed by the White House will not be possible unless Congress first amends the Budget Control Act to fix the spending caps. And the $54 billion in non-defense spending cuts proposed by the White House, even if enacted into law, can’t be used to offset the defense spending increase unless Congress first amends the BCA to fix the caps.
So the big issue for FY18, obviously, is the fate of legislation to amend the spending caps. Any legislation changing the spending cap levels will have to get 60 votes in the Senate (unless Senate Republicans decide to invoke the “nuclear option” and get rid of the filibuster as it pertains to legislation). Indeed, it is hard to imagine eight Democratic senators voting to break a filibuster or waiving points of order to approve a $54 billion cut in non-defense spending, even if it does offset a $54 billion increase in defense spending. And such a high level of non-defense cuts would probably lose a handful of Republican Senate votes, as well.
In the absence of agreement on a law amending the spending caps, either bipartisan or partisan, the levels written into current law would remain in place, which would mean a $3.2 billion cut in total non-defense discretionary spending in 2018 (compared to 2017) instead of the president’s proposed $54 billion cut. A much better, but still painful scenario.
By Daniel Sheehan
AFOP Executive Director
On January 24, the nonpartisan Congressional Budget Office (CBO) released its annual Budget and Economic Outlook covering the ongoing fiscal year 2017 and the ten-year 2018-2027 period and painting a very bleak picture for future spending. While I appreciate that budget matters can be a little technical and dry, I encourage you to read on so you can understand the fiscal realities facing federal decision-makers.
Of the big picture, CBO economists are said to be projecting real economic growth to stay just below two percent per year for the next decade, limiting how much federal tax receipts will grow. Inflation will also stay at about two percent per year, but rising interest rates will increase federal spending on debt interest significantly. The persistent structural imbalance between what the federal brings in and what it spends will mean ballooning federal deficits. CBO projects the deficit in the current fiscal year 2017 to be $559 billion; however, the office says the deficit will breach the trillion-dollar threshold as soon as FY 2023, reaching $1.4 trillion in 2027. The ten-year cumulative deficits over the 2018-2027 period are projected to total $9.4 trillion. When these deficits are added to the cost of federal loan programs also financed by federal borrowing, CBO projects that the public debt held will rise by $10.1 trillion over the next decade, reaching $24.9 trillion at the end of 2027. That amount would equal 89 percent of one year’s Gross Domestic Product (GDP).
Compounding matters is what budget analysts have predicted for decades: an aging population drives mandatory entitlement costs (like Social Security, Medicare, and Medicaid) higher and higher, while the 2011 Budget Control Act (BCA) constrains discretionary spending for the time being (and rising entitlement and net interest costs “crowd out” discretionary spending later on down the line). This is not just a macro level concern, because almost all federal spending on the workforce system is classified as “non-defense discretionary.”
The news is particularly bad for non-defense discretionary spending in the upcoming fiscal year 2018. BCA placed legally binding annual caps on total defense and non-defense discretionary appropriations. If Congress enacts appropriations bills that exceed the cap levels, another round of budget sequestration must occur to reduce all spending down to the cap levels.
You will recall that, back in 2012, the “Super Committee” (Joint Committee on Deficit Reduction) failed to agree on a deficit reduction plan, triggering a dramatic reduction in spending caps. Since then, two-year budget deals in 2013 (covering fiscal years 2014-2015) and 2015 (covering fiscal years 2016-2017) have raised the caps for those years in exchange for reduced spending in other areas down the road. As a result, however, the cap levels for 2018 are now lower, in nominal dollars, than the 2017 levels. The defense cap drops by $2.0 billion and the non-defense cap drops by $2.9 billion.
The CBO baseline for discretionary spending assumes the previous year’s appropriations plus an across-the-board inflation adjustment. (This year, it is two percent). Baseline appropriations levels for fiscal year 2018 are $53.1 billion above the combined cap levels ($13.5 billion on defense and $39.6 billion on non-defense). Even if you give fiscal year 2018 non-defense appropriations a hard freeze at the fiscal year 2017 levels (which are based on the ongoing continuing resolution, which is a hard freeze at the fiscal year 2016 levels for NFJP and most other U.S. Department of Labor programs), total non-defense appropriations would still be about $11 billion over the fiscal year 2018 spending cap, forcing another round of sequestration. The new president has discussed increasing defense spending above current levels and decreasing non-defense spending, but any cap changes would have to be implemented through legislation requiring at least 60 votes in the Senate for approval.
While budget problems pose, admittedly, very difficult challenges, Congress and the White House must and soon find a way to forge a bipartisan budget plan to preserve the BCA’s equal treatment of defense and non-defense discretionary spending, provide reasonable cap relief, and make the necessary long-term fiscal fixes to sustain adequate investments in the nation’s infrastructure and its people. These are the realities our leaders face, and these are the challenges they must overcome.
From Daniel Sheehan, AFOP Executive Director
November 15, 2016
In a surprise to many pollsters and pundits, and much of the general public, businessman Donald J. Trump on November 8 won the 2016 presidential election and is now moving forward with this transition team as president-elect to set up a new government. AFOP wishes him and the new administration well in their efforts to work for the public good in behalf of all in this great nation of ours.
Many in the anti-poverty community are understandably worried about what a Trump Administration will mean for their work in supporting the very poorest among us, given some of the president-elect’s more strident rhetoric on the campaign trail. With the White House, United States Senate, and United States House of Representatives now under Republican control for the first time in more than a decade, these service-providers are concerned that Congress, with the White House’s blessing, will make drastic cuts in domestic spending to pay for large increases in defense. While that remains to be seen, these anti-poverty groups have vowed to defend the programs and the funding they feel are the very fabric of the nation’s safety net.
In regard to the highly successful and critically needed National Farmworker Jobs Program (NFJP), there is really no telling at this point what the change in administrations will mean going forward. While it is true that NFJP, year in and year out, exceeds the United States Department of Labor’s national program performance goals, providing life-changing training and related assistance to some of the hardest to reach and hardest to serve in America, and while it is also true that the 2014 Workforce Innovation and Opportunity Act lengthened the NFJP grant term to four years, one must understand that these new, longer grant awards are subject to the future availability of appropriated funds. NFJP’s fiscal year 2016 appropriations are in place through June 30, 2017, but Congress has not yet finalized fiscal year 2017 spending, and now may not until after President-elect Trump’s inauguration. Should the president-elect seek to eliminate NFJP funding, we at the Association of Farmworker Opportunity Programs (AFOP), the non-profit organizations and state entities that deliver NFJP services to migrant and seasonal farmworkers, must make a concerted effort to educate policymakers about the importance of the program, its tremendous reach throughout the country, and why it is necessary to sustain the nation’s commitment to assisting farmworkers and their families earn more stable and secure employment, both inside and outside of agriculture. NFJP service-providers have mounted such an effort before, and are ready to do so again.
A request by the new administration to zero out NFJP is far from a given, however. The president-elect has expressed support for the idea of job training for individuals to meet the unmet demand of employers for qualified workers. Also, the president-elect, who prides himself on having created thousands of jobs as a businessman, has sworn to be “the greatest jobs president that God ever created.” During a September campaign speech, he said he has a plan to add 25 million jobs to the market over the next 10 years. While he included few specifics at the time, he did say he would replace “bureaucrats who ‘only know how to kill jobs’ with ‘jobs-creation experts.’” In addition, the idea of generating and filling more jobs shares bipartisan support. According to the Gallup’s Election Benchmark Survey, 88 percent of Democrat-leaning voters and 80 percent of Republican-leaning voters call the issue of above average importance, a fact that both sides of the aisle seem to appreciate.
Lastly, we can be heartened by the fact that the president-elect sounded a unifying tone in his victory speech in the early morning hours of November 9. It is my very real hope that, with the election now behind us, the president-elect is sincere in his remarks.
“Now it’s time for America to bind the wounds of division, we have to get together. To all Republicans and Democrats and independents across this nation, I say, it is time for us to come together as one united people,” Trump said. “I pledge to every citizen of our land that I will be president for all Americans, and this is so important to me.”
“For those who have chosen not to support me in the past, of which there were a few people, I’m reaching out to you,” Trump said. “For your guidance and your help, so that we can work together and unify our great country.”
In closing, please take time to review an easy-to-read primer on how the federal budget process works, linked here, as produced by the Center on Budget and Policy Priorities. It provides all the necessary information needed to understand and follow the federal budget process during what is certain to be a changed and challenging year.