These 6 Priorities Show the Need for a Robust Domestic Discretionary Budget
Earlier this week, Congress reportedly agreed to enact a stopgap measure to keep federal government agencies operating, but it expires on March 11. Policymakers must do more than merely extend that stopgap; they must enact full-year appropriations that adequately fund the nation’s priorities and needs. This would give federal agencies greater certainty, making it easier for them to choose how and when they will allocate their resources. Moreover, an updated discretionary budget that full-year appropriations provide would allow Congress to address the country’s ever-changing needs, including the newest challenges presented by the coronavirus and the spiraling opioid epidemic.
This article highlights six key priorities that illustrate the need for robust full-year funding:
- Responding to the pandemic and preparing for future health threats
- Addressing the nation’s opioid epidemic
- Supporting students in high-poverty schools
- Boosting funding for high-quality education for students with disabilities
- Shortening the long wait times for Social Security disability benefits
- Enabling the IRS to provide basic service for regular taxpayers and police wealthy tax cheats
While discussing all the vital elements in the discretionary budget is beyond the scope of a single article, these priorities illustrate how discretionary programs support everyday Americans.
National priorities demand that Congress do more than pass another stopgap
Congress must approve 12 appropriations bills every year to set amounts for the discretionary part of the federal budget. Often, these bills are combined and passed as omnibus bills. Discretionary spending accounts for about one-third of the federal budget, but it includes both national defense and the wide range of services, investments, and basic government functions categorized as “nondefense discretionary” (NDD). (see text box below) The other roughly two-thirds of the budget consists of “mandatory” programs, such as Social Security and Medicare, that have permanent funding.
A nonexhaustive list of these functions includes:
- Public health, including disease control
- Treatment of mental illness and substance use disorders
- Community health centers and other health care
- Medical research
- Scientific advancement
- Space exploration
- Consumer protection
- Food and drug safety
- Economic development, including for rural and urban communities
- Rural broadband
- Minority-owned business development
- Job training
- Investments in highways, transit, rail, ports, and waterways
- Labor protections
- Workplace safety
- Clean air and water protections
- Environmental cleanup and justice
- Climate research
- Research and development of renewable energy
- Regulation of nuclear energy
- Public lands management
- Housing assistance
- Aviation safety and security
- Veterans’ health care
- Other veterans’ services such as job training
- Federal aid to K-12 schools
- Pell Grants and other higher education assistance
- Early childhood education for low-income children
- Funding to states for child care
- Nutrition for low-income mothers and children
- Heating and cooling assistance for low-income people
- Administrative funding for the Social Security Administration’s retirement, survivors, and disability programs
- The Bureau of Indian Affairs
- Civil rights enforcement
- Opioid crisis initiatives
- Arts and humanities
- Diplomacy and international aid and development
- U.S. contributions to fighting deadly diseases globally
- Forest management
- National parks, the National Archives and Records Administration, and the Smithsonian Institution
- Small-business assistance
- Agricultural research
- The National Weather Service
- Disaster prevention and relief
- Tax collection and taxpayer services
- The FBI and other law enforcement</li
As has become common in recent years, Congress is late in finalizing appropriations for the current fiscal year (2022), which began on October 1, 2021. The appropriations bills have advanced to various stages of the legislative process. But enacting them ultimately requires bipartisan cooperation, given that they need 60 votes to pass the Senate. Since October 1, Congress has kept government agencies operating at last year’s funding levels through continuing resolutions (CRs). The current CR expires on March 11.
By fiscal year 2019, NDD spending was just 3.12 percent of GDP—its lowest share of the economy since the government began reporting this statistic in 1962.
Kicking the can down the road with another CR at 2021 levels, effectively cutting funding in inflation-adjusted terms, would set back many urgent priorities. As the Center for American Progress has previously noted, the United States badly underinvested in NDD priorities over the past decade, with NDD spending falling well below its historical average. By fiscal year 2019, NDD spending was just 3.12 percent of gross domestic product (GDP)—its lowest share of the economy since the government began reporting this statistic in 1962. As a result, the federal government severely underfunded key prerogatives such as public health, Pell Grants, rural broadband connectivity, opioid crisis prevention, federal aid to low-income public schools, and tax administration.
The Biden administration has proposed substantial increases in NDD funding. Under President Joe Biden’s budget proposal, it would average 3.7 percent of projected GDP between 2021 and 2026, just below the 1962–2010 historical average of 3.8 percent. This would make a real difference in the lives of many ordinary Americans; yet because NDD funding is a mix of numerous distinct programs, many do not recognize its importance. This article spotlights six ways in which adequately funding key priorities would make life better for everyday individuals and families.
Priority 1: Respond to the pandemic and prepare for future health threats
The COVID-19 pandemic has highlighted major weaknesses in America’s public health infrastructure. Delays and difficulties implementing measures such as contact tracing, testing, supplying personal protective equipment, and distributing vaccines proved costly to the nation’s ability to reduce infection rates and save lives.
Despite increasing health threats caused by climate disasters, the opioid epidemic, newly emerging infectious diseases, and growing health disparities, most types of public health funding remained flat or declined in the decade prior to the current pandemic. A decline in the public health workforce exacerbated this trend. After a two-year fight against COVID-19, the U.S. public health system is now in an even more fragile state than before, with resources diverted to respond to COVID-19 from other problems, such as chronic disease, suicide, and infectious disease prevention. Researchers have found that the United States needs an additional 80,000 full-time workers just to provide basic public health services.
Number of additional full-time workers needed to provide basic public health services
Congress can fill some of the gaps that predate COVID-19—and that have worsened during the pandemic—by passing a bipartisan appropriations bill that funds key public health investments. The pending House and Senate bills would boost public health funding by $2 billion—well short of the necessary amount, but an improvement on the status quo. This additional $2 billion would fund infrastructure and workforce-building activities through the Centers for Disease Control and Prevention, support biomedical research for vaccine and therapeutic development for public health threats such as COVID-19, and build the Strategic National Stockpile that helps supply medical and protective equipment. Foregoing or further delaying this investment would harm the country’s ability to address the current pandemic, prepare for the next emergency, and manage everyday public health needs.
Priority 2: Address the nation’s opioid epidemic
The number of fatal drug overdoses in the United States over a 12-month period surpassed 100,000 for the first time in April 2021. Overdoses now kill more Americans than car crashes, shootings, and pneumonia. More than 70 percent of overdose deaths in 2019 involved opioids, including prescription opioids, heroin, and synthetic opioids such as fentanyl—increasing by more than six times since 1999. For all racial groups, drug overdoses are the leading cause of rising mortality in young and middle-aged adults.
A variety of factors have been implicated in this increase, from families’ economic struggles, to the growing prevalence of deadly fentanyl in the illicit drug supply, to the COVID-19 pandemic, which has led to social isolation and challenges for individuals needing in-person treatment or other support. Yet opioid overdoses and deaths are preventable. Medication-assisted treatment—the use of medications in combination with counseling and behavioral therapies—can successfully treat these disorders and can help sustain recovery for some people struggling with addiction.
Share of overdose deaths in 2019 that involved opioids
Expanding access to evidence-based treatment is critical to addressing the opioid epidemic. The president’s budget and the House and Senate appropriations bills would increase access to treatment services for thousands of individuals through higher funding for the State Opioid Response program. This program provides states with resources that some have used for community-based treatment and recovery options, additional treatment beds and behavioral health workers, and prevention campaigns. Unless Congress passes a comprehensive discretionary budget, it will fail to address the health, social, and financial implications of the opioid epidemic, including preventable deaths and increased spending on health care, social services, education, and the criminal justice system.
Priority 3: Support students in high-poverty schools
Chronic underinvestment in K-12 education has left many schools without sufficient resources and supports for students and educators—especially schools in high-poverty communities and schools that predominantly serve students of color. As a result, many students suffer difficult learning environments that negatively affect their well-being and academic outcomes.
One way that the federal government has tried to address both the inadequacy and inequity of public school funding is through Title I Part A of the Elementary and Secondary Education Act (Title I). Title I is a federal program that targets funds to districts serving high numbers or percentages of students from families with low incomes.
But funding for Title I is discretionary, not mandatory, and Congress has never fully funded the program. A smaller pot of Title I dollars means that each school district receives just a fraction of the federal funding that they need to support their students.
These investments would provide schools with crucial support, especially as they look for ways to reimagine education to better support school staff and meet the physical, social-emotional, and academic needs of all students.
Thankfully, President Biden’s budget proposal, as well as the Senate and House appropriations bills, include significant investments in Title I. The House bill would increase Title I funding by $19.5 billion above the fiscal year 2021 level, and the Senate bill by $16.6 billion. These investments would provide schools with crucial support, especially as they look for ways to reimagine education to better support school staff and meet the physical, social-emotional, and academic needs of all students. CAP has proposed a new program to direct additional federal resources to schools, but Title I remains the largest source of federal funding for K-12 education, and it’s important that it be adequately financed. Passing another CR that keeps Title I funding at fiscal year 2021 levels would further shortchange children, their families, and educators.
Priority 4: Boost education funding for students with disabilities
All students should have the ability to succeed in and be supported by the education system, including the more than 7.5 million children with disabilities in the country’s public schools. In support of this goal, the federal government allocates funding to states so they can provide services outlined by individualized education plans (IEPs) for students with disabilities and assist preschools that serve children with disabilities.
Number of children who have disabilities in U.S. public schools
In Part B of the Individuals with Disabilities Education Act (IDEA), Congress pledged to fund up to 40 percent of the cost of educating students with disabilities. But Congress has never followed through with adequate appropriations. In fiscal year 2021, Congress provided only about one-third of what IDEA promised. This underfunding from the federal government forces states and districts to cover the gap themselves, and they are often unable to provide all the services necessary for students with disabilities. These students already experience many challenges and negative outcomes, such as low high school completion rates, and these problems have only worsened during the pandemic.
Section 504 is a federal protection, and therefore, the federal government should provide additional funding for education so that states and districts can better support all students with disabilities.
Furthermore, about 1.4 million students with disabilities do not qualify for IEPs but are protected by Section 504 of the Rehabilitation Act of 1973. Unfortunately, because there is no dedicated funding stream for 504 plans, many inequities exist around who has access to these services—and these inequities negatively affect students of color and students in low-income communities. The inability to provide students with 504 plans leaves many unable to succeed academically and to access a variety of important services, including mental health services. Section 504 is a federal protection, and therefore, the federal government should provide additional education funding for evaluations and services so that states and districts can better support all students with disabilities.
The president’s budget, along with the House and Senate funding bills for education, would bump funding for IDEA Part B to $15.5 billion, an increase of $2.6 billion above fiscal year 2021 levels. These investments still do not fully fund IDEA—and additional funding should be provided to support students with 504 plans—but they are an important step in the right direction. It is critical that Congress avoid passing another CR and instead make important investments in the futures of students with disabilities through increased funding for IDEA.
Priority 5: Shorten the long wait times for Social Security disability benefits
Social Security Disability Insurance (SSDI)—the counterpart to Social Security old-age benefits—supports Americans who become too disabled to continue working. To qualify for benefits, applicants must have extensive work histories and thorough medical documentation of their disabilities. The application process is long and multifaceted, with the first two steps taking more than eight months total on average.
SSDI administrative funding has failed to keep pace with the needs of program beneficiaries, thereby severely harming many disabled Americans.
Although SSDI’s benefits are classified as mandatory spending, administrative funding for the program is discretionary. SSDI administrative funding has failed to keep pace with the needs of program beneficiaries, thereby severely harming many disabled Americans.
Most notably, there are extreme delays in scheduling hearings for people trying to appeal the denial of benefits after the second stage of the application process. As of December 2021, the understaffed Social Security Administration (SSA) had a backlog of more than 350,000 pending hearings. As a result, in fiscal year 2020, the average processing time for a hearing decision was 386 days (in addition to the 253 days for the first two steps). As a bipartisan group of former Social Security commissioners has noted, this extended delay is devastating for many applicants: “During the time a hearing is pending, virtually all of the people waiting for hearings have no earnings, so that many lose their homes and their families, and some even die.” Unsurprisingly, between fiscal years 2014 and 2019, nearly 67,000 applicants died while awaiting the SSA’s decisions, and another 48,000 filed for bankruptcy.
Understaffing at the SSA slows down hearings for people appealing denial of benefits
Number of pending hearings in backlog as of December 2021
Average processing time for a hearing decision
Number of disability applicants who died while awaiting appeals decisions, fiscal years 2014–2019
Wait times were even worse several years ago. Incremental funding increases have allowed the SSA to gradually reduce them, but at too slow a pace; the SSA aims to reduce the average processing time for a hearing to 270 days in 2022. The Biden administration has proposed increasing the SSA’s administrative budget authority by $1.3 billion to build upon this progress; the House-passed appropriations bill would increase funding by $1.1 billion. If Congress does not approve this increased funding, the case backlog will decline at an unnecessarily slow pace, imposing significant harm on disability applicants.
Priority 6: Enable the IRS to provide basic service for regular taxpayers and police wealthy tax cheats
The IRS has suffered especially steep budget cuts over the past decade, undermining the agency’s ability to provide basic services for taxpayers and stop the massive bleeding of revenue from tax evasion. From 2010 to 2021, the IRS budget was cut by 22 percent after adjusting for inflation. Its workforce was slashed as well by 20 percent from 2010 to 2020, with even bigger losses of enforcement personnel. Congress has also failed to provide the substantial multiyear funding that the agency needs to improve its badly outdated technology.
The IRS’ budget and workforce have seen steep cuts over the past decade
Decrease in IRS budget from 2010 to 2021
Decrease in IRS workforce from 2010 to 2020
The result is that the IRS is in crisis as it struggles to perform its most basic functions of serving taxpayers and collecting revenue. The United States will lose an astounding $7 trillion in revenue over the next decade from tax noncompliance, in large part because the agency is badly outgunned when it comes to policing tax cheating and aggressive avoidance by sophisticated taxpayers and large corporations—to the detriment of honest taxpaying families and business owners.
The IRS and the Taxpayer Advocate Service warn that taxpayers’ experiences may be especially rough this year, given years of underfunding by Congress and pandemic-related challenges. Tax filing season for 2021 just began, but as of mid-December, the IRS still had about 12 million unprocessed returns from 2020. The Taxpayer Advocate Service warns that “the unprecedented processing and refund delays taxpayers experienced in 2021 could be as bad, and potentially worse, in 2022”—depriving taxpayers of money they may need to get by for themselves or to meet employee payrolls and creating difficulties applying for mortgages or student loans. Similarly, given the complexity of tax filing, phone service is important for taxpayers trying to file accurate returns and claim benefits. But over the first six months of 2021, the IRS had only one customer service representative for every 13,000 calls.
The pending appropriations bills would increase IRS funding from $11.9 billion to $13.2 billion, which is a modest but urgent step forward. But much more is needed to modernize the IRS and catch tax cheats, which is why the Biden administration has proposed an $80 billion infusion over the next decade to enable the IRS to rebuild and modernize. (That funding amount is also included in the House-passed Build Back Better Act.) Moreover, these expenditures would more than pay for themselves, as the Treasury estimates that it would generate $400 billion in revenue, net of the $80 billion investment, from taxes owed that would have gone unpaid.
NDD spending was cut significantly over the past decade, and it’s time that Congress make up for that underinvestment. The only way to make progress is through a full-year appropriations bill that provides robust funding for critical domestic priorities.
The authors thank Alan Cohen and Mia Ives-Rublee for their thoughtful edits and feedback.
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