5 things to know about the U.S. Senate’s budget resolution

1. This is reconciliation.

Republicans in Congress, holding majorities in both chambers, have the opportunity to use budget reconciliation to pass major legislation that, because many aspects of it are partisan, is unlikely to get any support from Democrats.

That was not the original intent when lawmakers created it in 1974 as part of the Congressional Budget Act. According to the Congressional Research Service, “[t]he chief purpose of the reconciliation process is to enhance Congress’s ability to change current law in order to bring revenue and spending levels into conformity with the policies of the budget resolution. Accordingly, reconciliation may be the most potent budget enforcement tool available to Congress for a large portion of the budget.”

2. Budget blueprint.

The resolution the Senate passed 52-48 Friday morning is not the actual legislation that makes all the changes that Republicans and President Trump are calling for. It essentially gives instructions to the various committees that have jurisdiction over the various aspects of the bill, laying out general budgetary guardrails and expectations.

For example, the Senate’s resolution calls for increasing military spending by $150 billion over the next two years and spending on border security by $175 billion over the same time frame. The Senate Armed Services Committee and Homeland Security and Governmental Affairs Committee will, respectively, be responsible for writing the specific legislation to make that happen.

3. What About Tax Policy?

Extending his 2017 tax cuts is also a major part of President Trump’s America-first agenda. Senate Republicans haven’t forgotten about that but, looking to give the president a quick legislative victory, decided to pursue a 2-bill approach to passing his agenda.

Senate leadership feels that trying to shoehorn tax policy – a very complex and potentially divisive issue – into this bill would slow its progress and potentially jeopardize passage altogether. Their plan would be to take on the extension and augmentation of the 2017 tax cuts in a second reconciliation bill in the fall.

4. “One Big Beautiful Bill.”

President Trump has indicated he’ll be happy to get these policies enacted any way that Congress can do it, but he has also recently made it clear that his preference would be the strategy the House GOP is pursuing: putting everything into “one big, beautiful bill.”

House Republicans’ majority is even slimmer than in the Senate and so it’s imperative that all Republicans be in agreement, if they hope to pass this legislation. It won’t be easy, even assuming they can pass the budget resolution – coming to agreement on the specific details ($4.5 trillion in tax cuts, raising the debt ceiling by $4 trillion and at least $1.5 trillion in spending cuts) will be even more difficult.

The House will try to pass its budget resolution next week.

5. Whose Version Wins?

For now, the Senate GOP is saying that they will go ahead with the process they’ve started. They are aware that Trump would prefer to do everything with one bill, so if the House is successful over on its side and can get a massive reconciliation package across the finish line, Senate leaders say they will take that up and try to pass it. If the House stumbles, they will have their bill to fall back on.