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Celebrating ten years of productive partisanship.

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Policy watchers are already gearing up for major budget action under the new Congress and administration. As we consider the road ahead, BPC is looking back at just how we reached where we are today on budget policy.

The timeline below chronicles the major fiscal events since the start of the Obama administration and marks the key upcoming moments in the first 100 days of the next administration. Scroll down to see events as they occurred, and select “Read More” for a detailed description of what happened at each juncture. You can expand the charts to view the full images.


  1. The American Recovery and Reinvestment Act is enacted in response to the 2008 financial crisis, which the Congressional Budget Office estimates at the time will increase spending and reduce taxes by a combined $787 billion over ten years. Together with the effects of the recession, the federal deficit for Fiscal Year (FY) 2009 reaches a record of $1.4 trillion, or 9.8 percent of gross domestic product (GDP), the highest since World War II.

    February 2009

     

  2. President Obama signs the Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act (collectively known as the “Affordable Care Act”), a comprehensive overhaul of the United States health care system. The legislation passed using reconciliation instructions from the 2009 budget resolution, allowing it to pass with only Democratic support. At the time, the Congressional Budget Office estimates the law to reduce deficits on net by $143 billion over ten years.

    March 2010

     

  3. The Bipartisan Policy Center’s Debt Reduction Task Force, co-chaired by former Senate Budget Committee Chairman Pete Domenici and former Congressional Budget Office and Office of Management and Budget director Alice Rivlin, releases its final recommendations. Their plan would have reduced and stabilized the federal debt below 60 percent of GDP by 2020, and achieved $5.9 trillion in debt reduction over the first ten years. (In 2013, the task force’s recommendations on health care are subsequently updated by BPC’s Health Care Cost Containment Initiative.)

    November 2010

     

  4. The National Commission on Fiscal Responsibility and Reform, co-chaired by former White House Chief of Staff Erskine Bowles and former Senator Alan Simpson, releases recommendations designed to address the growth of entitlement spending and the gap between projected revenues and expenditures. The commission votes 11-7 in favor of sending its plan to Congress, short of the 14 vote supermajority required to do so. From 2012 to 2020, the commission’s plan would have achieved roughly $4 trillion in deficit reduction, and then would have balanced the budget by 2035.

    December 2010

     

  5. President Obama signs the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, which reduces payroll taxes for one year and extends certain tax cuts passed during the Bush administration as well as select provisions of the stimulus. The act increases the federal deficit by $858 billion over the next ten years.

     

  6. The United States reaches its statutory debt limit of $14.3 trillion, and the Treasury Department begins deploying “extraordinary measures,” which are technical procedures that enable the Treasury to temporarily stave off default. The X Date, when those measures are projected to be exhausted and Treasury runs out of cash to pay its bills in full and on time, is expected in early August 2011.

    May 2011

     

  7. Congress and the president enact the Budget Control Act of 2011, which creates the Joint Select Committee on Deficit Reduction (a.k.a. the super committee) while ending the immediate debt-limit impasse. The act:

    • Increases the debt limit in stages through 2012;
    • Establishes caps on discretionary spending through 2021;
    • Requires a congressional balanced budget amendment vote;
    • Creates a Congressional Joint Select Committee on Deficit Reduction with a mandate to find $1.5 trillion in budgetary savings over a decade; and
    • Establishes automatic procedures (i.e., “sequestration”) for reducing spending by up to $1.2 trillion if the Joint Select Committee fails to achieve its savings goal.

    CBO estimates at the time that this legislation would reduce deficits by $917 billion from 2012-2021, on top of at least $1.2 trillion in savings from automatic reductions in lieu of Joint Select Committee reductions, for total savings of at least $2.1 trillion over the following decade. The debt limit is increased in stages before ultimately reaching $16.4 trillion on January 27, 2012.

    August 2011

     

  8. President Obama signs the Middle Class Tax Relief and Job Creation Act of 2012, which extends the payroll-tax reduction and employment incentives from the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 for an additional year. The act increases the deficit by $190 billion over the next ten years.

     

  9. The Joint Select Committee on Deficit Reduction fails to come to an agreement on a deficit-reduction plan. Per the Budget Control Act of 2011, caps on defense and domestic discretionary spending are automatically reduced and enforced by a sequester that kicks in with the start of 2013.

     

  10. The United States reaches the statutory debt limit of $16.4 trillion, established by the Budget Control Act of 2011, and the Treasury begins taking extraordinary measures to postpone default. The X Date—when those measures are projected to be exhausted and Treasury runs out of cash to pay its bills in full and on time—is expected in February 2013.

    December 2012

     

  11. The combination of multiple fiscal events creates a so-called “fiscal cliff.” In response, Congress enacts the American Taxpayer Relief Act of 2012, which CBO estimates at the time will increase deficits from 2013-2022 by roughly $4.6 trillion (mainly from extending the majority of the “Bush tax cuts”) and postpones the sequester for two months.

    January 2013

     

  12. President Obama signs the No Budget, No Pay Act of 2013, which suspends the debt limit from the act’s passage through May 18, 2013.

    February 2013

     

  13. The sequester, which had been postponed by the American Taxpayer Relief Act of 2012, goes into effect. As specified in the Budget Control Act of 2011, the sequester entails automatic, across-the-board spending cuts through 2021.

    March 2013

     

  14. The statutory debt limit, suspended by the No Budget, No Pay Act of 2013, is reinstated at $16.7 trillion. The Treasury resumes its extraordinary measures to avoid defaulting on federal obligations. The X Date—when those measures are projected to be exhausted and Treasury runs out of cash to pay its bills in full and on time—is expected in the fall of 2013.

    May 2013

     

  15. The federal government begins a 16-day shutdown after Congress fails to enact either appropriations bills or a continuing resolution, the result of disagreements surrounding funding for the Affordable Care Act. The shutdown ends when President Obama signs the Continuing Appropriations Act of 2014 on October 16. The act contains a continuing resolution to fund federal spending at FY 2013 levels until January 15, 2014, and also suspends the debt limit until February 7, 2014.

    October 2013

     

  16. Congress enacts and President Obama signs the Bipartisan Budget Act of 2013. The act raises the sequestration caps for Fiscal Years 2014 and 2015, allowing for increased discretionary spending during those years, but extends the duration of sequestration caps on mandatory spending for an additional two years, through 2023.

    December 2013

     

  17. The suspension of the statutory debt limit expires and the debt limit is reinstated at $17.2 trillion. Treasury begins implementing extraordinary measures in order to finance the federal government on a temporary basis. Shortly thereafter, President Obama signs the Temporary Debt Limit Extension Act, which suspends the debt limit through March 15, 2015.

    February 2015

     

  18. The February suspension of the statutory debt limit expires and the debt limit is reinstated at $18.1 trillion. Treasury begins implementing extraordinary measures in order to finance the federal government on a temporary basis. The X Date – when those measures are projected to be exhausted and Treasury runs out of cash to pay its bills in full and on time – is expected in the fall of 2015.

    March 2015

     

  19. President Obama signs the Medicare and CHIP Reauthorization Act of 2015. The law replaces Medicare’s Sustainable Growth Rate formula (which had been continually suspended by policymakers for over a decade and would have resulted in steep cuts to Medicare reimbursement rates) with payment reforms designed to reward health care providers based on the quality of their outcomes over the quantity of services provided. On net, CBO estimates that the law will add $141 billion to the deficit over ten years relative to a scenario where the SGR was allowed to take effect (though the reform was effectively deficit-neutral when compared to the more-realistic alternative scenario in which reimbursement rates were frozen rather than cut). The law also includes a number of changes recommended by BPC’s Health Care Cost Containment Initiative in 2013.

     

  20. Both chambers of Congress pass a concurrent budget resolution for Fiscal Year 2016 – the first time since 2009 – with only Republican support.

    May 2015

     

  21. On the final day of Fiscal Year 2015, President Obama signs a temporary spending measure approving spending at FY 2015 levels through December 11, 2015.

     

  22. President Obama signs the Bipartisan Budget Act of 2015, which suspends the statutory debt limit through March 15, 2017. The act also raises the sequestration caps for Fiscal Years 2016 and 2017.

    November 2015

     

  23. After Congress extends the December 11 appropriations deadline to December 22 through two temporary spending measures, President Obama signs the Consolidated Appropriations Act of 2016. The act funds federal government operations through the end of Fiscal Year 2016. It also makes permanent several expiring tax expenditures, adding over $800 billion to the deficit over the next ten years.

     

  24. On March 16, the suspension of the statutory debt limit expires, and the debt limit will be reinstated at the level necessary to cover all borrowing since November 2015. If the debt limit is not raised or suspended again before March, Treasury will only be able to temporarily continue meeting all of the federal government’s obligations by deploying extraordinary measures. Current BPC estimates suggest that these measures will last through at least mid-summer of 2017.

     

  25. By April 15, the House and Senate are scheduled to pass a concurrent budget resolution setting discretionary spending levels for Fiscal Year 2018.

     

  26. By April 28, lawmakers must pass appropriations legislation or a continuing resolution. Otherwise, funding for federal government operations and discretionary programs expires and a partial government shutdown begins.