The federal government may be headed for a fiscal cliff later this year, as lawmakers must agree to a spending deal for 2020 by the end of September or face the prospect of $125 billion in automatic cuts to defense and non-defense appropriations. Shortly thereafter, the federal government’s borrowing limit will have to be raised in order to avert a potential market-rattling default on U.S. debt.
“It's a mess everyone knows is coming, and yet no one seems to have a plan -- at least at the moment -- for averting disaster,” CNN’s Haley Byrd and Phil Mattingly wrote on Sunday.
“It’s one of those cartoonish anvil-over-head moments," one senior Republican congressional aide told CNN: "We all look around knowingly like 'Man, we're about to get crushed by this,' but nobody's really sure how to get out from underneath it right now."
While lawmakers hope to reach a bipartisan spending deal to raise budget caps and avoid those automatic cuts known as sequestration, the White House reportedly has a different strategy, Axios’s Jonathan Swan reports:
“Senior administration officials — including acting Office of Management and Budget director Russ Vought and fiscally conservative chief Mick Mulvaney — have told Republicans that the president doesn't want Congress to strike a spending deal in September when current funding runs out. Instead, Team Trump wants a short-term solution to preserve the ability to fight for massive spending cuts in the fifth year of a Trump presidency.”
The White House reportedly wants a one-year “continuing resolution” that would extend 2019 spending levels through fiscal 2020, then another short-term extension to fund the government past the elections. Assuming Trump wins another term, the next step would be “an epic 2021 spending battle,” Swan writes, with the president freed up to push for massive cuts.
“Trump wants to spend more on prized projects,” according to Swan, including defense, veterans, NASA, infrastructure and border security, “but still views most of government as a mass of fraud and waste — ripe for slashing.”