NAICU Washington Update

Congress Passes Budget Plan

May 23, 2007

On Thursday, May 17, both the House and Senate debated the FY 2008 budget resolution (S. Con. Res. 21), and both chambers passed the plan within minutes of each other. The House voted 214 to 209, and the Senate voted 52 to 40. The Republican senators of Maine, Susan Collins and Olympia Snowe, voted for the resolution. The following senators did not vote: Brownback (R-Kan.), Coburn (R-Okla.), Dole (N.C.), Hatch (Utah), Johnson (D-S.D.), McCain (R-Ariz.), Smith (R-Ore.), and Sununu (R-N.H.).

Flipping back and forth between C-SPAN and C-SPAN-2, it was evident that both parties in both chambers had coordinated talking points. The Democrats focused on selling their budget resolution as returning to fiscal responsibility while increasing the federal investment on important national priorities like education, veterans' benefits, and health care. The Republicans said the budget plan calls for a tax increase, more spending, and claimed that Democrats want to spend taxpayer's money, while Republicans want Americans to be able to keep their own money.

The budget plan, which the president does not sign into law, includes $9.5 billion more than the president's budget for the education category. How that amount will be divided up between student aid and K-12 education will be up to the education appropriations subcommittee when they write a bill later this month.

The budget resolution also includes a reconciliation instruction to the education committees to find $750 million in savings to put towards deficit reduction by September 10, 2007. When the education committees act on this instruction, it will give them an opportunity to make changes to the student loan programs that would shift spending on lender subsidies to student benefits, and possible increased grant aid. How this bill and the other pieces of the Higher Education Act reauthorization come together will play out over the next couple of months.

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