Politics

October 14, 2013

Spending stumbling block to budget deal

Senate Republicans and Democrats at an impasse in thier efforts to avoid default in four days.

By Donna Cassata
The Associated Press

WASHINGTON – Senate Republicans and Democrats hit an impasse Sunday over spending in their last-ditch struggle to avoid an economy-jarring default in just four days and end a partial government shutdown that’s entering its third week.

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Protesters cheer as large trucks arrive at a rally at the World War II Memorial on the National Mall in Washington Sunday, Oct. 13, 2013. Leaders in the U.S. Senate have taken the helm in the search for a deal to end the partial government shutdown and avert a federal default. The rally was organized to protest the closure of the Memorial, subsequent to the shutdown, and lack of access to it by World War II veterans, who traveled there on Honor Flight visits.

The Associated Press

After inconclusive talks between President Barack Obama and House Republicans, Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., took charge in trying to end the crises, although a conversation Sunday afternoon failed to break the stalemate.

“Americans want Congress to compromise,” Reid said at the start of a rare Sunday session in the Senate, during which he pressed for a long-term budget deal.

The two cagy negotiators are at loggerheads over Democratic demands to undo or change the automatic, across-the-board spending cuts to domestic and defense programs that the GOP see as crucial to reducing the nation’s deficit.

McConnell insisted a solution was readily available in the proposal from a bipartisan group of 12 senators, led by Sens. Susan Collins, R-Maine, and Joe Manchin, D-W.Va., that would re-open the government and fund it at current levels for six months while raising the debt limit through Jan. 31.

“It’s time for Democrat leaders to take ‘yes’ for an answer,” McConnell said in a statement.

The latest snag comes as 350,000 federal workers remain idle, hundreds of thousands more work without pay and an array of government services, from home loan applications to environmental inspections, were on hold on the 13th day of the shutdown.

Several parks and monuments remain closed, drawing a protest at the National World War II Memorial on Sunday that included tea party-backed lawmakers who had unsuccessfully demanded defunding of President Barack Obama’s 3-year-old health care law in exchange for keeping the government open.

Unnerving to world economies is the prospect of the United States defaulting on its financial obligations on Thursday if Congress fails to raise the borrowing authority above the $16.7 trillion debt limit.

Christine Lagarde, the International Monetary Fund’s managing director, spoke fearfully about the disruption and uncertainty, warning of a “risk of tipping, yet again, into recession” after the fitful recovery from 2008. The reaction of world financial markets and the Dow Jones on Monday will influence any congressional talks.

Congress is racing the clock to get a deal done, faced with time-consuming Senate procedures that could slow legislation, likely opposition from tea partyers and certain resistance in the Republican-led House before a bill gets to Obama.

Politically, Republicans are reeling, bearing a substantial amount of the blame for the government shutdown and stalemate.

“We’re in a free-fall as Republicans, but Democrats are not far behind,” said Sen. Lindsey Graham, R-S.C., in warning Democrats about seizing on the GOP’s bruised brand as leverage to extract more concessions.

McConnell and Republicans want to continue current spending at $986.7 billion and leave untouched the new round of cuts in January, commonly known as sequester, that would reduce the amount to $967 billion. Democrats want to figure out a way to undo the reductions, plus a long-term extension of the debt limit increase and a short-term spending bill to reopen the government.

“Republicans want to do it with entitlement cuts,” said Sen. Chuck Schumer, D-N.Y. “Democrats want to do it with a mix of mandatory cuts, some entitlements and revenues. And so how do you overcome that dilemma? We’re not going to overcome it in the next day or two.”

He suggested keeping the government running through mid-January.

Sen. Dick Durbin of Illinois, the No. 2 Democrat in the Senate, told reporters the two sides are roughly $70 billion apart, the difference between the $1.058 trillion Senate budget amount and the $988 billion envisioned by House Budget Committee Chairman Paul Ryan, R-Wis.

(Continued on page 2)

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