U.S. Budget Deal Heads To Passage, Fiscal Fight Looms
Washington (AFP) – U.S. lawmakers were on track to pass a compromise budget deal Wednesday which could mark a truce in the fiscal wars long plaguing Washington, but a new battle already clouds the horizon.
The bipartisan accord, which sets top-line spending for the next two years and replaces some painful automatic spending cuts, has already passed the House of Representatives, and easily survived a crunch Senate procedural vote Tuesday, 67-33.
President Barack Obama is expected to sign the bill into law before leaving for Hawaii on Friday, allowing congressional appropriators to craft a spending plan under the new limits.
The new appropriations must be agreed by January 15 to avoid another government shutdown like the one which paralyzed Washington for 16 days last October.
The bill increases the $967 billion cap for 2013 spending to $1.012 trillion next year and $1.014 trillion in 2015, and brings some normalcy to a process recently rocked by chaos.
Many Republicans including Senate Minority Leader Mitch McConnell chafe at the deal because it slightly increases spending, beyond limits set in 2011 legislation.
“This isn’t a perfect bargain — no compromise is perfect. But the Senate should pass this agreement quickly,” Senate Majority Leader Harry Reid told the chamber shortly before the vote.
“It’s time to get back to setting fiscal policy through the regular order of the budget process rather than through hostage-taking,” Reid added.
“And it is time for Congress to show the American people that Democrats and Republicans can compromise rather than lurching from crisis to crisis.”
The modest deal eliminates $63 billion in the arbitrary spending cuts known as sequestration, and reduces the deficit by about $23 billion.
It does not close tax loopholes or include an extension of unemployment benefits, something Democrats have complained bitterly about.
Nor does it address reform of entitlement programs such as Social Security and Medicare, long sought by Republicans.
And it notably does not extend the debt ceiling, which Washington needs to raise by February or March if it wants to avoid a dangerous credit default.
That is where Republicans may seek to strike next.
House Budget Committee chairman Paul Ryan, who brokered the budget deal with Senate Budget Committee chairwoman Patty Murray, told Fox News Sunday that his caucus will gather next month to “discuss what it is we want to get out of the debt limit.”
“We don’t want nothing out of this debt limit,” he added.
McConnell too suggested congressional Republicans were gearing for battle.
“I doubt if the House, or for that matter the Senate, is willing to give the president a clean debt ceiling increase” without some concession from Democrats, McConnell said Tuesday.
But his rival Reid sought to downplay the future friction.
“I can’t imagine the Republicans want another fight on debt ceiling,” he told reporters Tuesday.
Washington has been embroiled in a near-constant cycle of fiscal warfare since 2011, when a grand bargain between Obama and Republicans collapsed.
The gridlock came to a head in October, when the feuding parties failed to agree on a budget and plunged the government into a costly, 16-day shutdown.
Outside conservative groups have urged senators to shoot down the budget deal because it fails to rein in spending.
But Senator John McCain scolded his fellow Republicans who might want to sink the legislation, reminding them that “the only alternative to this right now is a government shutdown.”
The new spending on defense and domestic programs is offset by raising the amount new federal workers must contribute to their retirement plans, and boosting air travel fees to the Transportation Security Administration.
Photo: Alex Wong / AFP