California braces for impact from Capitol Hill budget deal

Outgoing House Speaker John Boehner of Ohio talks with reporters on Capitol Hill in Washington, Tuesday, Oct. 27, 2015.
Outgoing House Speaker John Boehner of Ohio talks with reporters on Capitol Hill in Washington, Tuesday, Oct. 27, 2015. AP

Californians are scrambling to understand a two-year budget deal crafted by the White House and congressional negotiators.

It’s complicated.

The reins on domestic and military spending are loosened a little, while the social safety net is adjusted. Politically, lawmakers get relief from the recurring debt ceiling melodrama that has helped sink congressional approval ratings.

Taken together, the package set for a vote as early as Wednesday was sufficiently balanced to attract such ideological opposites as liberal House Minority Leader Nancy Pelosi of San Francisco and conservative House Majority Leader Kevin McCarthy of Bakersfield.

“I hope this agreement can move us past the destructive cycle of continuing resolutions and shutdown theatrics,” said Democratic Sen. Dianne Feinstein of California, adding that the bill was a “much-needed victory.”

But in a sign of unresolved congressional tensions, conservative Rep. Tom McClintock, R-Calif., criticized the measure that he says “runs up significant new debt that every American, including every Californian, will be repaying for years to come.”

“These bills are always difficult to pass. There are a lot more reasons to vote no than to get to yes,” said Rep. Jeff Denham, R-Calif., who as of Tuesday afternoon remained undecided.

Overall, the bill boosts on-budget spending by $80 billion, split evenly between domestic and military programs. The 144-page measure is comprised of many provisions, some excruciatingly technical.

I am pleased that Congress has reached an agreement on a bipartisan budget package that protects hardworking American families from a devastating default.

Rep. Doris Matsui, D-Calif.

California’s crop insurers, for instance, will face language requiring federal officials to renegotiate the Standard Reinsurance Agreement, with tighter caps placed on the insurance companies’ rate of return. Some farmers oppose this; reformers like it.

“There are no direct impacts on growers,” said Ferd Hoefner, policy director of the National Sustainable Agriculture Coalition. “The cut that is included is purely from the companies.”

Dubbed the Balanced Budget Act of 2015, the package devotes considerable specific attention to the Social Security program that currently provides payments to more than 5.4 million Californians, including roughly 850,000 state residents receiving disability insurance assistance.

The deal includes what Boehner called “structural entitlement reforms,” including stricter fraud-fighting requirements that disability insurance recipients first complete a medical review. Disability payments also would be newly pegged to the federal poverty level instead of the recipients’ prior income, resulting in lower benefits for some.

“With a Democratic president and a Republican House, we’ve put together a compromise, and it’s better than defaulting on the debt,” said Rep. Devin Nunes, R-Calif., noting that “it gets us through the next two years of Obama’s presidency.”

It appears to blow the lid off the budget that Congress had already enacted . . . and there’s one gimmick after another that I’m skeptical about.

Rep. Tom McClintock, R-Calif.

Medicare, which currently provides payments to upward of 5 million Californians, will still be curtailed by so-called sequester limits that amount to a 2 percent cut.

At the same time, the deal blocks a rise next year in premiums for Medicare Part B, which covers preventive health care services, ambulance travel and mental health treatment. It also extends the solvency of the Social Security Disability Insurance Trust Fund, avoiding 20 percent benefit cuts next year.

“The deal marks an important step forward,” said Rep. Doris Matsui, D-Calif., adding that it will “safeguard against the hard-earned benefits of older Americans being put at risk.”

Matsui’s Sacramento-area Democratic colleague, Rep. Ami Bera, also said his “sense is that this is going to be as good as we’re going to get.”

Employers will face what Boehner called a “modest increase” in fees to the Pension Benefit Guaranty Corp., which currently provides payments to about 42,000 California retirees whose private pension plans failed.

The $18.1 trillion federal debt ceiling now expected to be hit by Nov. 3 would be suspended until March 2017. Effectively that protects GOP lawmakers in particular from making the choice between the easy rhetoric of hating debt and the hard reality of avoiding a government default.

When the House last voted on a clean debt-ceiling measure, in February 2014, every California Democrat voted for it. The state’s Central Valley Republicans split, with Denham, McClintock and Rep. Doug LaMalfa opposed and McCarthy joining Nunes and Rep. David Valadao in support.

“You had members saying they hoped it passed but were unwilling to vote for it,” Nunes said at the time.

The budget bill’s final sentence renames part of the first floor of the Capitol the “Freedom Foyer.” To this, there is no known opposition.

Michael Doyle: 202-383-0006, @MichaelDoyle10