April 11, 2013

In Focus: Neither side budging on the budget

Analysis: Unable to agree on spending cuts or higher taxes, another 'continuing resolution' seems inevitable.

By DAVID LIGHTMAN McClatchy Newspapers

President Obama's $3.78 trillion budget Wednesday provided fresh, vivid evidence that Washington remains desperately divided over key spending and tax issues -- and that government appears poised to keep limping along without a broad budget agreement.

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Copies of President Obama’s budget plan for fiscal year 2014 are distributed to Senate staff on Capitol Hill in Washington on Wednesday.

The Associated Press

GUESS WHO'S COMING TO DINNER: REPUBLICANS WHO MAY FIND OFFERINGS INDIGESTIBLE

WASHINGTON - President Obama hosted Republican senators at the White House, with the budget, guns and immigration up for dinner table debate.

Their dinner came hours after Obama unveiled a $3.8 trillion budget proposal. His aides said other issues were up for discussion, including the gun bill up for debate Thursday.

Georgia Sen. Johnny Isakson compiled the invitations to the White House's Old Family Dining Room, at Obama's request. Among those on the list are Sens. Lamar Alexander of Tennessee, Arkansas' John Boozman, Maine's Susan Collins, Idaho's Mike Crapo, Wyoming's Michael Enzi, Nebraska's Deb Fischer, Utah's Orrin Hatch, Kansas' Pat Roberts, Florida's Marco Rubio, South Dakota's John Thune and Mississippi's Roger Wicker.

Obama had a similar dinner last month with other Republican senators at a hotel near the White House.

-- The Associated Press

Unable to reach agreement to cut spending or raise taxes, that means the federal government is likely to be funded by yet another "continuing resolution," or stopgap spending bill, extending the status quo of current spending and tax policies when the next fiscal year starts on Oct. 1.

About all that will be clear in the coming weeks is that Washington is once again deadlocked. Three different visions of how government should work are now on the table, as Senate Democrats and House Republicans approved their own very different versions last month.

Obama tried to offer some compromise Wednesday, most notably by proposing to slow the annual increases in Social Security benefits. But he convinced no one on Capitol Hill that a grand bargain is within reach to stop the nation's $17.2 trillion debt from continuing to grow, let alone start to shrink.

"I don't think we should talk about a grand bargain," House Budget Committee Chairman Paul Ryan, R-Wis., said flatly.

The gaps are too wide. Obama and Democrats want higher taxes, Republicans refuse.

Obama and Republicans disagree sharply on the future of Medicare. Republicans want to allow seniors the choice of private coverage or Medicare starting in 2024. Democrats are opposed.

Obama proposed slowing the growth of Social Security benefits in his new budget. Democrats were not pleased.

Most critically, Republicans want the budget to eventually return to balance. Democrats see that as unrealistic anytime soon. Both Obama and Senate Democrats peg their lowest annual deficits over the next decade at around $400 billion.

All these are profound disagreements, unlikely to be resolved in a matter of months, perhaps even years. Some progress has been made, notably the 2011 deal to reduce anticipated deficits with less spending, and the New Year's Day measure to raise an additional $600 billion.

Obama on Wednesday touted his new plan as an effort to inch toward the Republicans. Republicans weren't buying it. "It doesn't break new ground," Ryan said. Added House Speaker John Boehner, R-Ohio: "We don't need to be raising taxes on the American people."

Democrats were lukewarm, largely because of the proposed change in the way Social Security benefits are increased to reflect higher cost of living. Rep. Chris Van Hollen of Maryland, the top Democrat on the House Budget Committee, said he had "concerns with aspects of this budget."

Few spoke on Capitol Hill about breakthroughs.

"Every time I read something about John Boehner it sounds totally unreasonable," said Sen. Tom Harkin, D-Iowa, who heads the Senate subcommittee that writes legislation on health, education and labor-related spending. Boehner insists that Obama got $600 billion in new revenue in the January fiscal cliff agreement, so this is no time to seek more.

"How can you deal with someone who takes that kind of position?" Harkin asked.

Republicans also were not optimistic. "It's a wide chasm," said Sen. Jeff Flake, R-Ariz., a longtime activist on budget issues.

The gap is widest on the four issues that have dominated the budget debate for years: Medicare and other entitlements, taxes, domestic spending and the deficit. The outlook:

Medicare and entitlements. Obama is willing to take steps that would cut about $401 billion in anticipated federal health spending over 10 years. Wealthy beneficiaries would pay higher Medicare premiums, and lower-income people would get incentives to use generic drugs.

(Continued on page 2)

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