The Government Is Still Operating Under Trump’s Budget

The Revolving Door Project, a Prospect partner, scrutinizes the executive branch and presidential power. Follow them at therevolvingdoorproject.org.

A lot has changed in the year since President Biden took office. Across the executive branch, leaders who believe in the power of government to advance the public interest have replaced predecessors who were intent on dismantling the institutions they led. Unsurprisingly, policy priorities have shifted as well, with regulators embarking on ambitious new rulemakings and ramping up enforcement.

But there is one troubling constant looming above all of these changes: President Trump’s holdover budget is (basically) still in place, leaving the Biden administration to implement a bold new agenda with funding levels negotiated and approved by an administration that was determined to make that impossible.

Democrats have had multiple opportunities to change this over the last year, but sacrificed each in the pursuit of an elusive agreement over Build Back Better. Instead, we’ve seen continuing resolutions that maintain Trump-era spending priorities. Between now and the next government funding deadline on February 18, Democrats will have another chance. With their banner legislation stalled and the midterms fast approaching, they cannot afford to delay a moment longer. They must fight for a funding agreement that provides the resources agencies need to fulfill the scale and ambition of the administration’s agenda.

A bit of historical context may help to make clear why the next funding deadline is so critical. The Trump administration did not want the government to work for regular people and set its budget proposals accordingly. Most agencies faced cuts of approximately 20 percent, while others saw their budgets as much as halved, or even zeroed out. These proposals would not ultimately win congressional approval, but what did—funding agreements that either enacted small cuts to agency budgets or held them constant—was bad enough.

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That’s because Trump inherited a federal government that was already riddled with the scars of austerity. Funding levels for positions that regulate corporate America have been trending downward since the 1980s. Starting in 2013, the pace and depth of budget cuts grew with the imposition of mandatory spending caps, the result of a misbegotten bargain between Obama’s White House and congressional Republicans. With all that as the backdrop, the Trump administration didn’t have to realize its most radical budget dreams to have a devastating impact.

The Biden administration seemed to recognize the dire state of what it had inherited. Its first budget request, released last spring, proposed large, across-the-board increases, ranging up to 40 percent over the prior year’s budget for some agencies. If the budget process was working as intended, Congress would have then taken that request, modified it as it saw fit, and passed it into law by the start of fiscal year 2022 (which is actually October 1, 2021).

But they didn’t do that. Instead, first in September and then again in December, leadership punted by passing a continuing resolution (i.e., measures that simply hold funding steady at prior levels) rather than diving into negotiations to set funding levels that would bring agencies out from under the shadow of Trumpian austerity. Build Back Better, it seems, eclipsed all other priorities.

This trade-off is entirely of congressional leaders’ own making. There was no reason lawmakers needed to choose between advancing new programs and giving the agencies the resources they need to carry out new and existing responsibilities. History shows us that Congress does not need to take up measures sequentially, and risk burning all political momentum on just one or two pieces of legislation. It can work on multiple priorities at once.

But leaders chose not to. Now, as new legislation stalls and all eyes turn to the executive branch, the effects of that procrastination are coming into focus. The funding uncertainty that comes with reliance on continuing resolutions is, for example, threatening implementation of the landmark infrastructure legislation passed last fall. As acting administrator of the Federal Highway Administration Stephanie Pollack told Roll Call, “There are some limitations on some of the new programs since we’re operating under a continuing resolution, so we’re focusing on the programs that we have the appropriations as well as the authorizations for.”

Many other agencies are also operating under budgets that fall well short of what they need to effectively carry out existing responsibilities, let alone tackle new ones. This is particularly true of agencies with responsibility for reining in corporate misbehavior. The Federal Trade Commission (FTC), for instance, has been struggling to keep up with rising merger review and enforcement demands for over a decade. Now, it is managing a “tidal wave” of applications amid a major merger boom, while also revisiting outdated rules and pursuing major cases, all with approximately the same staffing levels and budget. An increase of $1 billion for FTC enforcement was included in Build Back Better, but with that stalled, the agency remains critically underresourced.

The Occupational Safety and Health Administration (OSHA) has been seeing its workforce shrink relative to the population of American workers for three decades. In 1990, OSHA had one employee for every 52,000 workers; in 2019, it had one for every 90,000. It’s no wonder then that many have worried about its ability to enforce pandemic-related safety measures. As my colleague Hannah Story Brown recently documented, the Federal Maritime Commission is currently facing down a major shipping crisis with just 117 employees and a budget one-fifteenth the size of that for the military’s marching bands.

Then there’s the Internal Revenue Service. And many more. I could fill pages and pages with examples. And while agency leaders and staff are generally making the best of the situation, these hard material realities are undoubtedly having an effect on the scope, efficiency, and effectiveness of agency action.

Congressional Democrats cannot delay any longer. With the February 18 funding deadline fast approaching, they must fight now to secure a funding agreement that gives agencies the resources they need to advance an ambitious public-interest agenda.

Critically, meeting that goal will require more than simply enacting President Biden’s 2022 budget proposal. While that document was laudable for rejecting a long-running consensus in favor of austerity and refusing to shy away from sizable budget increases, it still did not go far enough. Biden’s proposed funding levels would reverse the losses that occurred under President Trump, but in most cases would fail to return agency budgets to where they were before the austerity of the 2010s. Getting back to those levels, which were already depleted when compared to the decades prior, should be considered the bare-minimum commitment when it comes to restoring the federal government’s capacity to act in the public interest. In many cases, lawmakers will need to go beyond them to make way for robust enforcement of, for example, environmental, labor rights, and tax policy.

In making their case, including to the more conservative members of their caucus, Democrats have the advantage that the required increases are relatively small, especially when compared to the measures that have passed in the last couple of years. Bringing federal funding back in line with the pre-1980 level (approximately 5 percent of GDP), an admittedly ambitious goal, would require an investment of about $400 billion, or one-tenth of the sums that have gone out the door for pandemic relief. Narrowing the scope of increase to corporate regulators would cost a mere fraction of that sum, and most such regulators would more than pay for themselves by collecting fines from guilty corporations.

With Build Back Better’s future still highly uncertain, lawmakers will also need to incorporate its agency funding measures into their omnibus bill. In addition to large sums for the Federal Trade Commission and the Department of Justice’s Antitrust Division, BBB made investments in the IRS and others. It’s a bit of a mystery why these were in BBB to begin with rather than previous continuing resolutions, but regardless, it’s clear they don’t belong there any longer.

In the sprint to the midterms, executive branch action could be an essential tool with which Democrats make their case to American voters. But a bold agenda, without adequate investment in the institutions charged with carrying it out, is sure to fall short of its full potential, practical or political. Democrats must not miss this next opportunity to bring the two in line.

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