Republicans and Democrats Reach Budget Deal

Members of the bipartisan budget conference Rep. Paul Ryan (R-WI) (L) and Sen. Patty Murray (D-WA) discuss their initial meeting at the U.S. Capitol October 17, 2013 in Washington, DC. Congress voted last night to fund the federal budget and increase the nation's debt limit, ending a 16-day government shutdown.
National Journal
Sarah Mimms, Billy House and Tim Alberta
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Sarah Mimms and Billy House Tim Alberta
Dec. 10, 2013, 11:41 a.m.

Budget ne­go­ti­at­ors on Tues­day night an­nounced they’ve reached a two-year deal that sets spend­ing for the cur­rent fisc­al year at $1.012 tril­lion and would provide $63 bil­lion in se­quester re­lief — all without new tax rev­en­ue.

“I’m proud of this agree­ment,” said Re­pub­lic­an Rep. Paul Ry­an, one of the two prin­cip­al ne­go­ti­at­ors, in a state­ment shortly be­fore an even­ing news con­fer­ence. “It re­duces the de­fi­cit — without rais­ing taxes. And it cuts spend­ing in a smarter way. It’s a firm step in the right dir­ec­tion, and I ask all my col­leagues in the House to sup­port it.”

Sen. Patty Mur­ray, who handled the ne­go­ti­ations for Demo­crats, said, “This agree­ment breaks through the re­cent dys­func­tion to pre­vent an­oth­er gov­ern­ment shut­down and roll back se­quest­ra­tion’s cuts to de­fense and do­mest­ic in­vest­ments in a bal­anced way.”  

The deal, be­ing dubbed the Bi­par­tis­an Budget Act of 2013, will still have to get the go-ahead of rank-and-file law­makers in both parties. The House is set to ad­journ at the end of the week, and Re­pub­lic­ans there are ex­pec­ted to meet be­hind closed doors Wed­nes­day morn­ing, as their lead­ers eye a floor vote by Fri­day.  

The pro­posed pack­age would set over­all dis­cre­tion­ary spend­ing an­nu­al­ized for the cur­rent fisc­al year at $1.012 tril­lion. That’s about mid­way between the level of $1.058 tril­lion pro­posed in the Sen­ate’s budget, and the House-pro­posed budget level of $967 bil­lion.

The deal would bring fisc­al 2015 spend­ing to about $1.014 tril­lion. The plan does not deal with the debt ceil­ing, which is an­ti­cip­ated to be reached some­time after Feb. 7.

The agree­ment also would provide $63 bil­lion in se­quester re­lief over two years, split evenly between de­fense and nondefense pro­grams. In fisc­al 2014, de­fense dis­cre­tion­ary spend­ing would be set at $520.5 bil­lion, and nondefense dis­cre­tion­ary spend­ing would be set at $491.8 bil­lion.

In fisc­al 2014, de­fense dis­cre­tion­ary spend­ing would be set at $520.5 bil­lion, and nondefense dis­cre­tion­ary spend­ing would be set at $491.8 bil­lion.

The se­quester re­lief is de­scribed as be­ing fully off­set by sav­ings else­where in the budget.

The agree­ment in­cludes dozens of spe­cif­ic de­fi­cit-re­duc­tion pro­vi­sions, with man­dat­ory sav­ings and non-tax rev­en­ue total­ing roughly $85 bil­lion, al­though de­tails of how these sav­ings would be real­ized were not im­me­di­ately re­leased. The agree­ment would re­duce the de­fi­cit by between $20 bil­lion and $23 bil­lion.

Some con­ser­vat­ives have re­cently voiced op­pos­i­tion to swap­ping out se­quester cuts for “user fees,” while lib­er­als have cri­ti­cized any deal that does not ex­tend un­em­ploy­ment in­sur­ance.

A po­ten­tial ma­jor stick­ing point for some law­makers could be that one meas­ure be­ing used to help pay for ad­ded spend­ing is in­creased premi­ums for pen­sion plans backed by the Pen­sion Be­ne­fit Guar­anty Corp.

However, the pack­age also does not in­clude an ex­ten­sion of un­em­ploy­ment be­ne­fits, due to ex­pire at the end of Decem­ber — something Demo­crats have been cham­pioned.

Rep. Steve Is­rael, chair­man of the Demo­crat­ic Con­gres­sion­al Cam­paign Com­mit­tee, said Tues­day af­ter­noon that he can’t say wheth­er House Demo­crats will be on board.

“We’re still feel­ing our way through this,” he said. “Some of the com­pon­ents may be a hard sell for House Re­pub­lic­ans. So, we need to find out where they are, and where we are.”

House Re­pub­lic­ans have let it be known they have a con­tin­gency plan in place.

“Part of our con­ver­sa­tion was on the short-term piece,” Rep. James Lank­ford, the Re­pub­lic­an Policy chair­man, said Tues­day af­ter­noon. “If this [budget] deal doesn’t pass, we’ve got to have a short-term piece ready to get to­geth­er and get out there.”

Cor­rec­tion: A pre­vi­ous ver­sion mis­stated the status of the pen­sion pro­vi­sion.

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