Policy: Budgets & Deficits

Budget deal no one likes may spare Congress a new crisis

By |
Obamacare,Paul Ryan,David M. Drucker,Budgets and Deficits,Government Shutdown,Patty Murray

After three years of governing on a crisis-to-crisis basis, a divided House and Senate were on the verge of a budget compromise that could finally provide the kind of fiscal stability that has long eluded lawmakers and get them out of the public's doghouse.

The budget deal, hammered out over eight weeks by Senate Budget Committee Chairwoman Patty Murray, D-Wash., and House Budget Committee Chairman Paul Ryan, R-Wis., didn't address the most sensitive budget issues dividing Republicans and Democrats, like Medicare reform. But the two-year, $2 trillion deal does provide a spending plan through 2015, ensuring there are no additional congressional budget meltdowns before the 2014 elections.

Democrats and Republicans were motivated to strike a deal for different reasons. But one thing was clear: Members of both parties were intent on avoiding another politically debilitating impasse like the 16-day government shutdown that paralyzed Washington in October.

“We’re doing this agreement in large part because what that will do is avoid those government shutdowns,” Ryan said. “You see, because we’re doing a two-year agreement here, we avoid a possible shutdown in January and another possible shutdown in October.”

Since the Republicans recaptured the House in 2010, ushering in the first divided Congress since 2001, the U.S. has twice faced the prospect of the government defaulting on its debts while the Republican House and Democratic Senate haggled over raising the debt ceiling. Then this year, a Republican effort to defund Obamacare led to a government shutdown.

In a capital that has lurched from crisis to crisis through most of President Obama's tenure, the fact that Murray and Ryan were able to reach an agreement at all is being hailed as a political breakthrough. As a matter of policy, however, even the two negotiators conceded that their proposal doesn't achieve the kinds of fiscal reforms needed to address the country's stark fiscal problems.

“We need to acknowledge that our nation has serious, long-term fiscal and economic challenges this deal doesn’t address,” Murray said. “We made a conscious decision ... to focus on were we can agree and not get bogged down in larger issues, that, while important, are not going to get solved right now.”

The Bipartisan Budget Act of 2013 covers fiscal years 2014 and 2015. It would spend $1.012 trillion through next September, a figure halfway between the $967 billion the House wanted and the $1.06 trillion the Senate sought.

To satisfy Democrats who wanted more money for domestic programs and Republicans who wanted to protect the Pentagon's budget, $63 billion in cuts set to hit Jan. 1 were restored, largely through increases in government user fees. The compromise would also reduce the budget deficit by $22.5 billion over 10 years.

The agreement would cut cost-of-living increases for military pensioners who did not retire because of injury or disability, saving $6 billion over 10 years. It also would raise to $5.60 the tax airline passengers pay for the Transportation Security Administration, raising nearly $13 billion over 10 years.

Without the Murray-Ryan compromise, the government faced the prospect of a second shutdown on Jan. 16, when the current, temporary funding bill expires. Still, there was much grumbling among lawmakers about the compromise.

But even conservatives, who see the higher user fees as stealthy tax increases and worry that the budget savings won’t come until much later, have been muted in their criticism of the deal.

Despite their gripes, conservatives see it as the best deal available in a divided government and concluded that fighting over it would distract public attention from the troubled Obamacare rollout and possibly lead to another politically damaging government shutdown.

“It's a step in the right direction and there are some reforms in there that I think are good,” said Rep. Ted Yoho, a Tea Party-aligned Florida Republican who supported the October shutdown and was not inclined to support the compromise. “The good thing is, it'll prevent a government shutdown.”

View article comments Leave a comment