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Newt Gingrich (1:38)
On this episode of Newts World, we're really going to talk about the whole process of reconciliation, why it's so complicated, how it's evolved, and as you watch it play out in the next couple months, what you can expect and look for. Reconciliation is a central tool to try to get some control over spending. It was originally created with the Congressional Budget and Impoundment control act of 1974, and it allows for special consideration of certain defined tax, spending and debt limit legislation. Now, part of the reason this was necessary is that the Senate, which was designed, as President George Washington put it, to be the cooling saucer to the hot cup of coffee from the House, has a set of rules that make it so hard to pass anything that if you want something big, it helps to have a device to get things through. And that's what reconciliation is. Let me explain further. In the Senate, you have to have 60 votes to be able to bring something up to pass it. Now, when you have a partisan issue, neither party has had a 60 vote majority and so people can stop things, cause confusion, demand specific changes. And they came up with the idea of A reconciliation process so that you could actually bring it to the floor. And it's the one thing which cannot be filibustered. So it only takes a simple majority or a tie vote. And the vice president. That's why it becomes so central. And over time, what's happened is the House and Senate have learned to dump everything they can into a reconciliation bill because it's the one thing you can try to force through the Senate. And that's really the background of this, and that's why it works. Now, in theory, we ought to have a simple, clear process of appropriations, and everything which is spent by the government should be appropriated, which means that the Appropriations Committee writes a bill, let's say, for the Defense Department, sends it from the House to the Senate. They meet, they come up with a single bill, which is then voted on by both the House and the Senate. It then goes to the president to get signed. Now, that's the way it should work, and they should get it all done before the end of the fiscal year so that when they enter the new fiscal year, which is October 1st, at that point, you're supposed to have passed all the appropriations bills. Well, almost nobody gets it done for a lot of different reasons. It's very hard to do. People are fighting over the amount of money. The very process of legislation is cumbersome and filled with all sorts of loopholes that slow you down and require you to do things. So when you don't have all the appropriations bills done, you then have what's called a continuing resolution. Now, the continuing resolution basically says, normally we're going to continue to spend at the rate of last year. If you want to spend more money, put some pressure to try to adopt appropriations just to get them done. But generally speaking, the use of a continuing resolution has been ongoing now for several decades. The challenge here is really simple. You want to get a continuing resolution out. Remember, it takes 60 votes in the Senate, and you have to have the votes in the House. So both sides, both Democrats and Republicans, figure out ways to basically charge a fee. You want to get this done, Then I want something from my side. And so you get into very difficult, very tense negotiations, and it then leads to potentially shutting down the government, because theoretically, if you do not have a appropriations bill and you do not have a continuing resolution, there is no money. Now, again, in the nature of the American system, they find ways to wriggle around this. And so the Defense Department, the police, people who matter for public safety, somehow get funded even when they're not funded. But this puts real pressure on the Congress. And that's why routinely, two or three or four times a year, you'll see stories about, is the government going to shut down? Well, even if it does shut down, everybody gets paid while they're not working, then it reopens. So it's not a crisis, but it just makes everything very complicated. So the first thing we're looking at is can they get through a continuing resolution to keep the government open? And that has to go through both the House and the Senate. Second, once you have gotten past that challenge, you have to pass a budget. And the House recently, and I wrote about this as sort of a miraculous event, the House, which has no margin on the Republican side, I mean, they're down to having a two or three vote margin, and they have one member from Kentucky who will always vote no and is totally hopeless. So they really have the tiniest of margins. And they had to pass a budget. And this was really important psychologically because both President Trump and Speaker Johnson want to pass one big reconciliation bill, which would have money for the border, but it would also have money for the tax cuts, and it would have a large number of changes to save money. And they put together a budget and they brought it up. And at first, Johnson thought he did not have the votes. He thought he was three votes short. And so he told the members, go on home, we're not going to be able to vote today. Ten minutes later, they called back and said, whoops, come on back in. Because in the interim, Johnson, who had done an amazing job and had gotten the first 213 or 214 yeses, Trump stepped in and got the last three literally by phone calls while they were trying to decide whether or not to move forward. So now the House has passed a budget, and I'll come back to why that's important in just a minute. It's now over on the Senate side, and it gets trickier there both because under the Senate rules, The budget takes 60 votes. The Democrats aren't inclined to be cooperative. They want to add some things, but anything you add, if it has to come back to the House, it's very hard to see how Johnson can pass it. So they'll have a very tough time getting something out of the Senate. If it's significantly different from the House, they'll have a very tough time negotiating it and getting down to a single common budget resolution. Now, at that point, the reason this matters is under the Congressional Budget act, it is the budget, which establishes the overall plan, sets the guidelines on spending and revenue. And at that point, you trigger the reconciliation bill. Now, if you think about it, reconciliation is a very useful practical term. What it means is you have to reconcile the budget as passed with current law. So let's say that the budget as passed says we're going to spend a billion dollars on going into space, but current law says we're going to spend $3 billion going into space. Now you have to reconcile. And the principle is that the budget takes precedent. So you've got to find a way to cut the $2 billion in order to have reconciled current spending with the budget. And that becomes a very, very complicated process. If they're lucky, if they can get it done, it'll take two or three months to negotiate the scale of change that they want. Because to his credit, Speaker Johnson has picked up the sentiment of President Trump and the desire of the people who elected President Trump to achieve real change. And so they have produced a budget which is going to require dramatic real change. Now, there's one more piece of this just to sort of add to the complexity. Reconciliation is defined in the Senate by what is called the Byrd rule. Bob Byrd of West Virginia was the majority leader and then the Appropriations chairman. I served with him. He was one of the smartest and toughest people in the U.S. senate in modern times. And he proposed a rule which basically says you, you can only bring up under reconciliation things that relate to money. And so that means that they can't just dump in every bill they want and thereby escape having to go through the process involved with the potential for the Senate to basically filibuster and stop it. Now, the Bird rule then has the parliamentarian deal with, is this in or is this out? Does this affect spending or does it affect recent revenues? If it does, then you're allowed to move forward. If you do more than the budget bill, you can then be pushed into. You're not reconciling to the budget. So the budget really sets the stage. Then you think through the reconciliation and you have to word everything very carefully. Even in the House, you have to look at everything very carefully in order to make sure that you fit the Byrd rule so that it could be passed with 50 votes plus the vice president. And that's an enormously complicated problem in terms of what you can and can't get done.