What: All Issues : Fair Taxation : Five-year budget resolution (S. Con. Res. 21)/Rep. Paul Ryan (R-Wis.) motion to instruct conferees to reject the revenue levels set in the House budget resolution, accommodate the extension of the 2001 and 2003 tax cuts and prohibit the use of the Social Security trust fund to finance other government programs (2007 house Roll Call 308)
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Five-year budget resolution (S. Con. Res. 21)/Rep. Paul Ryan (R-Wis.) motion to instruct conferees to reject the revenue levels set in the House budget resolution, accommodate the extension of the 2001 and 2003 tax cuts and prohibit the use of the Social Security trust fund to finance other government programs
house Roll Call 308     May 08, 2007
Progressive Position:
Nay
Progressive Result:
Loss

This vote was on a Republican motion to instruct House representatives on a joint House-Senate conference committee meeting to iron out the differences between the two chambers' fiscal 2008 budget resolutions. Rep. Paul Ryan (R-Wis.) moved to instruct the conferees to include language in the final report that would reject the revenue levels set in the House budget resolution and insist on the revenue projections outlined in the Senate's version, which provided for the extension of the 2001 and 2003 tax cuts set to expire in 2010. The motion would also insist that the conference report mandate that the Social Security trust fund not be used to finance other government spending.

The budget resolution forms the blueprint for spending decisions for the next five years. It is passed by the House and Senate but is not signed by the president nor does it have the force of law. (That is why it is referred to as a resolution and not a bill.) Nonetheless, the ability of both chambers to agree on budget priorities is considered a prerequisite to responsible spending and good governance as it gives the 12 spending panels on the Appropriations Committee guidance and reflects consensus on how the multi-trillion dollar pie of federal spending should be sliced.

A motion to instruct conferees is a way for the House to go on record outlining how the chamber wants its representatives to negotiate a compromise measure. It carries heavy weight in the conference committee because the final version of the resolution that emerges from those discussions has to go back to each chamber for approval.

Among the differences between the chambers was the total fiscal 2008 discretionary spending (which excludes Medicare and Social Security funding), which the House's version set at $956 billion and the Senate wanted to see lowered by $7 billion. (The House's figure was also $23 billion more than President Bush requested.)

Republicans said that the House's version of the budget plan would amount to the biggest tax increase in American history. What they were referring to was the budgetary treatment of future actions to renew tax cuts enacted in 2001 and 2003, which the House's resolution didn't account for. In its version of the resolution, the Senate went on record in supporting the extension of some of those tax cuts by financing their costs with expected surpluses. The House outlined its support for the extension of certain tax breaks less formally, drawing Republican criticism.

Because the budget resolution is not binding, however, the debate essentially amounted to what sort of political statement Congress would make on the extension of the tax cuts, which are set to expire in 2010. (The sun-setting provision was originally put in place, at least in part, to mask their huge budgetary consequences at the time of enactment.)

Republicans didn't endorse the budget put forth by either chamber, but they found the Senate's version more agreeable. Republicans said that the House plan amounted to a tax increase. House Democrats said they placed a higher priority on balancing the budget in five years while not cutting spending, and accused Republicans of running up the national debt since Bush took office, and they promised to extend certain middle-class tax credits, but those tax provisions were not included in the formal budget put forth by the House.

Ryan said his motion reflected "a very simple up or down choice: One, rejecting the largest tax increase in our nation's history, which is contained in the House budget; two, insisting on the lowest possible level of taxes available in the budget conference; and three, stopping the raid on Social Security's cash surpluses."

He went on to add that both chambers' versions of the budget "call for historic tax increases, and we in the minority can't do anything to prevent that," but he hoped with this vote to "at least minimize the damage that these tax hikes will bring."

Budget Chairman John Spratt (D-S.C.) said independent, third-party groups such as the Concord Coalition and the Center on Budget and Policy Priorities as well as the Brookings Institution stated unequivocally that the budget resolution neither called for nor required a tax increase.

"We have included in the budget resolution not one place, but twice, in different parts of the resolution, our wholehearted endorsement, our commitment, our pledge, our determination to see that these middle-income tax cuts are preserved and enacted and carried forward when they expire per their terms," Spratt said. "The budget resolution does not cause them to expire. They were designed to expire, written to expire when they were offered and passed. At that particular time, that was part of the provision."

Rep. Earl Blumenauer (D-Ore.) added that he found it ironic that Republicans were talking about fiscal responsibility when for "12 consecutive years of ironclad Republican control they wrote all the fiscal rules, wrote the budgets, wrote the tax policy ... [and] it's a pretty sorry record of fiscal irresponsibility."

Blumenauer added that there wasn't "that great a difference of opinion" between Ryan's motion (which would essentially endorse a budget resolution closer to the Senate's) and the House-passed budget. "We are, in fact, going to be able to meet the objectives. We are working hard in our budget to make sure that we deal meaningfully with tax relief for those who need it," he added.

One way or another, Democrats were all but assured of getting their way because they held the upper hand in the conference committee because of their majorities in both chambers.

Despite their comments, however, both Blumenauer and Spratt ended up voting for Ryan's motion.

Only 57 Democrats opposed the motion to instruct, and Republicans were unanimous in their support for it. By and large the opposition came from the House's most progressive lawmakers, although it was certainly not a homogenous group.

Rep. Bobby Scott (D-Va.), who voted against the motion, said it violated the most fundamental concept of pay-as-you-go spending (PAYGO), under which tax cuts and spending increases have to be off set by revenue increases elsewhere in the budget. He said Republicans threw PAYGO out the window when President Bush took control of the executive branch in 2001, after previous Congresses had climbed out of deficits into surpluses with fiscal responsibility and adherence to PAYGO principles.

"Mr. Speaker, PAYGO is a very simple concept. If you are going to increase spending, you pay for it. If you are going to cut taxes, you pay for it. You don't go into the ditch. If you have a tax cut, you have to pay for it either with increases of other taxes or spending cuts to pay for it. If you have spending increases, you have to pay for it with cutting spending somewhere else or increasing taxes to pay for it," Scott said, adding "we got out of the ditch with fiscal responsibility, and as soon as 2001 came along, you let PAYGO expire, passed tax cuts that we couldn't afford and put us right back into the ditch."

Scott said Ryan's motion assumed "$250 billion in cuts that we are not going to make."

"The fact is that the only way the Republican budget makes any sense is if you have $250 billion in cuts, mostly in Medicare and Medicaid, at a time when we can't even afford the cuts that are already in effect," Scott continued. "What are your priorities? Tax cuts that we can't afford at a time when we need to cover children? We can't even afford the Medicaid program we have got now."

Three-quarters of Democrats joined all Republicans present in passing Ryan's motion to instruct House negotiators to reject portions of the House-passed budget resolution in the chamber's negotiations with the Senate on a budget resolution for fiscal 2008 through fiscal 2013. Most significantly, the motion to instruct conferees rejected the revenue levels set in the House budget resolution and insisted on the revenue projections outlined in the Senate's version, which provided for the extension of the 2001 and 2003 tax cuts set to expire in 2010. The final vote was 364 to 57. The House had originally not included the extension of those tax cuts in its five-year budget plan, and this vote represented a rejection of that decision. Although the motion to instruct conferees is not binding, it has a weighty impact on negotiations between the chambers and reflects the House's consensus on how the two chambers should iron out differences in creating a compromise budget.

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