Eakinomics: Reconciliation Trifecta?

Today, the House Budget Committee is scheduled to mark-up a budget resolution. The Chairman’s mark was released yesterday and Jordan Haring has a complete analysis here. Officially, it is a fiscal 2027 budget resolution, but in practice it does not contain a comprehensive plan for spending, revenues, and borrowing. Instead, it is a more narrowly crafted plan, as Haring notes:

The budget would address the ongoing conflict in the Middle East and servicemember pay, farm aid, and state efforts to implement voter ID requirements in elections; it includes reconciliation instructions to four House committees to increase budget deficits by no more than a combined $95 billion over the FY 2027–2036 budget window.

Eakinomics’ first observation is that these issues would normally be handled in the annual appropriations process, or via a request for supplemental appropriations. They are being considered in reconciliation only because that makes it theoretically possible — the state of the universe where cats and dogs live together, Elizabeth Warren puts her faith in Kevin Warsh, and California passes a resolution binding Gavin Newsom to market solutions and a small, efficient government — that it pass the House and Senate on a party-line vote. This isn’t the intended purpose of reconciliation, but welcome to 2026.

Second, this is just the first step. There has to be a House-passed budget resolution, a Senate-passed resolution, and then passage in the House and Senate of what would be reconciliation bill number three.

Third, it is easy to get lost in all the requests for money. There was a basic appropriations request in the annual process of $1.2 trillion in defense spending. The president wanted another $350 billion — and suggested using reconciliation to pass it. The third request was for supplemental money to cover munitions and other costs associated with hostilities in Iran. This effort is focused on that supplemental request.

The final observation is that this is hardly a reconciliation slam dunk. As Haring notes:

Media reports suggest the committee’s reconciliation measures will likely include grants to states to help states implement voter ID requirements in elections, in line with the provisions in the SAVE America Act.

Reconciliation is restricted to issues that are budgetary in nature, which voter ID is not. Tying the voter ID language to grants is an attempt to generate a budgetary nexus. There is always the possibility that the Senate parliamentarian will rule against that language and it would have to be removed.

Today is the opening act of a drama with a potentially complicated plot.