New direction for the U.S. Senate Budget Committee

The U.S. Senate Budget Committee is unique. The committee is Established in 1974 In response to President Richard Nixon’s “seizure” of funds appropriated by Congress to prevent spending on programs he did not like. This created a constitutional crisis because the U.S. Constitution gives Congress the power of the purse. Congress, along with the Senate Budget Committee, responded by enacting the Congressional Budget and Seizure Control Act of 1974. The committee is officially responsible Contributed to “the drafting of the Congressional budget plan and the oversight and enforcement of spending, revenue, and federal budget regulations.”

During the biennium of the 118th Congress (2023-2024), the committee deviated from this mission. Of the 43 public hearings held, only a handful focused on the national budget. Of these, 24 were related to the economic impact of climate change. Committee Ranking Member Chuck Grassley (R-Iowa) pointed this out in an article. April 2024 Letter Majority Committee Chairman Sheldon Whitehouse (D-RI) allegedly used the committee to conduct an alarming and destructive campaign, fueled by the testimony of unqualified expert witnesses. Ru. Mr. Grassley replied: March 2024 Letter The White House wrote to Republican committees complaining about their grievances. In his letter, Grassley also suggested that other committees, such as the Environment and Public Works Committee and the Finance Committee, have primary jurisdiction over climate change policy.

Republicans will take control of the Senate on January 3, 2025, and a Republican senator will replace White House as chair, potentially steering the committee in a new direction. expensive. Reflecting on the 118th Congressional hearings, and in preparation for the 119th Congressional hearings, we humbly offer some suggestions and comments for the Senate Appropriations Committee to provide something of value. . After all, there is much work to be done to address our nation’s $1.8 trillion deficit and $33 trillion debt mountain.

1. Refocus on the fundamental mission. In 2023-2024, there were very few Budget Committee hearings that actually focused on the budget. In addition to the 24 cases focused on climate change, others focused on unrelated topics such as reproductive freedom, immigration, and income inequality.
2. give the other person a chance. Congressional hearings have an abhorrent tradition in which the majority announces testimony immediately before the hearing. This nasty trick deprives the minority of enough time to read and understand the majority’s proposal. At a committee hearing on December 18, this abuse took to an extreme. Two voluminous reports were attached to the hearing: 36 pages. “Uncovering the economic costs of climate change” Report and 84 pages “Next in the fall: the climate insurance crisis is here and getting worse.” Both reports were highly technical and data-rich, and were released just hours before the hearing, giving minorities precious little time to learn about their contents. It’s difficult to write a book review about a book you haven’t had a chance to read.

3. Stop being selective about data. The committee has a history of being selective with its sources and data. For example, the following reports use arguments and data: secure our futurea wide-ranging organization whose partners focus on ideology rather than science. One such partner is Connecticut Citizen Action Groupthe company describes itself as “dedicated to engaging Connecticut residents.” change power relations To realize a more just society. ”

4. See more relevant data. The December 18, 2024 hearing was to focus on policy non-renewal data requested by the insurance company on November 2, 2013. It was not clear whether non-renewal included consumer-directed insurance purchases. Updated data does not accurately reflect insurer behavior. A more useful analysis would have been to simply look at insurer losses and composite ratios by state and smaller segment. Therefore, the Commission’s premise that nonrenewals are a leading indicator of insurer withdrawal due to climate change is erroneous, as are conclusions that rely on such data.

5. Let’s not exaggerate. The Budget Committee has become a source of unwarranted alarmist rhetoric declaring the insurance industry on the brink of collapse and in danger from climate change. committee reported that “Climate change poses new systemic risks to the U.S. economy. A systemic risk that has the potential to ripple beyond the directly affected sectors and cause widespread economic damage. The main risk is the insurance sector. “The collapse of the economy will affect the mortgage and real estate markets.” Climate change is causing property losses that are causing insurance premiums to rise and insurance companies to stop offering coverage. As a result, homeowners are abandoning their homes, thereby causing a loss in home values, triggering a housing crisis, triggering a major financial crisis, and potentially causing an economic downturn, especially if carbon emissions are not curbed immediately. is paralyzing.

6. Please report the good news. The Committee commented that insurance availability and affordability is a particularly acute problem in Florida and California. What their analysis failed to report is that these are special cases. Florida’s insurance woes stem from a proliferation of unwarranted lawsuits, while California’s problems stem from insurance regulations that effectively restrict insurers from risk-adjusted rate pricing policies. However, the situation in both states has improved. Tort reform measures passed in Florida in 2023 have helped stabilize the insurance market, and California insurance regulators have begun allowing insurers to factor climate trends and reinsurance costs into pricing. There is.

7. Cut wasteful government programs. The Committee missed the opportunity to comment on two areas related to climate change. do Impacting the budget: government spending on flood damage and large subsidies given to crop insurance buyers. Currently, the government’s flood insurance program is $20.5 billion in debt. The federal crop insurance program subsidizes two-thirds of the cost farmers pay in premiums. As a result, flood insurance and crop insurance are sources of large disaster payments. The budget could benefit from cutting these wasteful programs or implementing free market principles. (Are you listening, Elon and Vivek?)

8. Promote resilient buildings. Resilient buildings are the best protection against losses from natural disasters, including those amplified by climate change. Building stronger homes, following building codes, and refraining from building in unsafe ways can all reduce the need for federal disaster relief. Examples of successful programs in operation include Strengthen Alabama Homes, which builds homes with “reinforced” roofs; sell 7 percent higher than those without. Strong forest bonds Effectively mobilize private capital to reduce wildfire risk in California.

9. Tell the truth about your insurance company’s financial situation. The Budget Committee claims that insurance companies are failing and Florida’s home prices are plummeting, but that’s not the case. Florida’s median home price has held steady at about $400,000 for the past two years (up from $250,000 in 2020). During the same period, the non-life insurance industry’s surplus increased from $929 billion to $1.13 trillion, resulting in a combined ratio of 97.8 percent through the third quarter of 2024, the strongest financial result in five years. .

The Senate Budget Committee has important powers. The 119th Congress began constructive efforts to reduce our nation’s crippling debt and budget deficit. If not, you can rely on R Street to stir up some eggs.

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