Key support for budget deal; deficits would rise - Fox 2 News Headlines

Key support for budget deal; deficits would rise

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  • Key support for budget deal; deficits would rise

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WASHINGTON -

A newly minted budget deal to avert future government shutdowns gained important ground Wednesday among House Republicans who are more accustomed to brinkmanship than compromise, even though it would nudge federal deficits higher three years in a row.

There was grumbling from opposite ends of the political spectrum — conservatives complaining about spending levels and liberal Democrats unhappy there would be no extension of an expiring program of benefits for the long-term unemployed.

Yet other lawmakers, buffeted by criticism after last October's partial government shutdown, found plenty to like in the agreement and suggested it could lead to future cooperation. The plan was announced Tuesday evening by Sen. Patty Murray, D-Wash., and Rep. Paul Ryan, R-Wis., and quickly endorsed by President Barack Obama.

A House vote was expected as early as Thursday as lawmaker race to wrap up their work for the year.

"A lot of folks will probably vote for it even though they would rather not support this type of legislation, but we have to get the spending issue completed so that there is some consistency in the future," said Rep. Jeff Miller, R-Fla.

Senate Majority Leader Harry Reid, D-Nev., called the agreement "a breath of fresh air" that could lead to further progress. Added House Speaker John Boehner, R-Ohio, "If you're for more deficit reduction, you're for this agreement."

Boehner also took a swipe at outside groups that helped steer Republicans toward the politically damaging shutdown and opposed the current deal before it was sealed. "They're using our members, and they're using the American people for their own goals. This is ridiculous," he said, evidently referring to the Club For Growth, Heritage Action and other organizations.

Modest in scope, the deal underscores how much ambitions have shriveled since the summer of 2011, when Obama and Boehner held private but unsuccessful talks on a "grand bargain" to reduce deficits by $4 trillion over a decade.

In the current climate, though, it means a return to something approaching a routine, where spending committees will be able to write and pass individual bills each year, removed from the threat of a shutdown.

As drafted, the bill would reverse $63 billion in across-the-board spending cuts scheduled to take effect in the current budget year and the next one, easing a crunch on programs as diverse as environmental protection and the Pentagon.

It would offset the higher spending with $85 billion in savings over a decade from higher fees and relatively modest curtailments on government benefit programs.

Nearly a third of the total savings would come almost a decade from now, in 2022 and 2023, partly from extending a current 2 percent cut in payments to Medicare providers.

Other changes are scripted to begin earlier. Future federal workers would pay more toward their own retirement, fees would rise on air travelers and corporations would pay more to the government agency that guarantees their pension programs.

With the increased spending to begin immediately and much of the savings delayed, Congressional Budget Office estimates showed the deal would push deficits higher than currently projected in the current year and each of the next two.

Red ink would rise by about $23 billion in this 2014 fiscal year, $18 billion in the next year and about $4 billion in the one after that, the CBO said.

Ryan briefed members of the Republican rank and file in private on the deal, then emerged to tell reporters it "helps produce more certainty because it stops a potential government shutdown in January and it stops a potential government shutdown in October.

"We think that's good for the country. At the same time, we wanted to make sure that we are taking a step in the right direction for fiscal discipline," he added.

The measure marked a turn in Ryan's career, thrusting him into the spotlight as a deal-maker, rather than the author of staunchly conservative annual cut-the-deficit budgets that Republicans love and Democrats loathe.

As his party's 2012 vice presidential nominee and a potential contender for the White House in 2016, Ryan may well have to defend the agreement against criticism from other presidential hopefuls.

Sen. Marco Rubio, R-Fla., also counted among his party's presidential contenders, criticized the deal. "'I think to walk away from the already agreed-upon reductions in spending that were so difficult to achieve, I think opens the floodgates that really threaten to put us right back in these spending habits and really, we're going to continue to have a government that spends more money than it takes in," he said.

Other conservatives made plain their unhappiness.

Rep. Mick Mulvaney, R-S.C., said spending levels in current law are lower than those in the agreement. "The default, to do nothing, was a win for conservatives," he said.

The Club for Growth said Sen. Ted Cruz was also opposed, although his office declined to issue an official confirmation. Either way, there was no talk of a repeat of last fall's all-night filibuster in which the Texas Republican demanded the new health care law be defunded in exchange for keeping the government operating.

Democrats were less than ecstatic, too, given that Republicans refused to include the extension of unemployment benefits.

"Looking at it on its own merits, I think the pros outweigh the cons," said Rep. Chris Van Hollen of Maryland, who worked privately to secure a last-minute change that shields current federal workers from higher pension costs.

Rep. Nancy Pelosi of California, the party's leader, said she would seek neither to round up support nor scuttle the measure.

"Stay tuned," she told reporters. Later in the day, 165 Democrats signed a letter to Boehner not to let the House adjourn before it votes on extending the program.

Without action by Congress, benefits will end on Dec. 28 for an estimated 1.3 million unemployed workers off the job longer than 26 weeks. An additional 1.9 million would experience the same fate in the early months of 2014, according to administration estimates.

Republicans were unrelenting on the jobless benefits but not on every issue. Officials said that Boehner and Reid had jointly decided to add a three-month provision to the budget deal that would prevent a 20 percent cut in payments to doctors who treat Medicare patients. Payments would rise by one half of one percent instead.

The cost, $8 billion, would be offset by savings elsewhere in Medicare and in Medicaid.

Among Republicans, House Appropriations Committee members also favored the budget deal, since it increased the likelihood they would be able to pass annual spending bills rather than rely on short-term stopgap bills that reduce their power over the federal purse.

So, too defense hawks in both parties, pleased that the agreement would restore some of the across-the-board reductions made in the Pentagon budget. "This is something I can support," said Rep. Howard "Buck" McKeon of California, head of the House Armed Services Committee.

____

By DAVID ESPO and ANDREW TAYLOR Associated Press

Associated Press writers Henry C. Jackson, Alan Fram and Donna Cassata contributed to this report.

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