Budget deal aims to avoid shutdowns

Ryan promotes agreement as it heads to Senate vote

Monday, December 16, 2013

WASHINGTON - The top Republican architect of a U.S. budget agreement said Sunday he wanted to avoid the prospect of future government shutdowns after a 16-day partial closure in October hurt the economy.

“Government has to function, and we saw the specter of two possible government shutdowns in 2014, one in January and one in October,” Rep. Paul Ryan, a Wisconsin Republican who is chairman of the House Budget Committee, said on NBC’s Meet the Press. “It’s not good for the country. It adds more instability to the economy.”

The budget deal, expected to win Senate approval this week after House passage last week, would avoid a partial government shutdown when spending authority expires Jan. 15. It funds thegovernment for the 2014 fiscal year that began Oct. 1 and for the 2015 fiscal year.

The agreement lessens the automatic spending cuts known as sequestration by $40 billion in the 2014 budget and by $20 billion in fiscal 2015. It sets spending at about $1.01 trillion for this fiscal year, higher than the $967 billion required in a 2011 deal that set sequestration in place.

The deal would cut the deficit by $23 billion and cancel planned cuts to doctors’ Medicare reimbursement rates. It doesn’t extend emergency benefits for 1.3 million unemployed workers.

“Getting a budget agreement that reduces the deficit without raising taxes and prevents two government shutdowns from occurring in 2014, in my opinion, is the right thing to do and it’s a good thing to do,” Ryan saidon NBC.

A 16-day partial shutdown starting Oct. 1 resulted from an impasse between President Barack Obama and Republicans who demanded changes to his 2010 healthcare law as a condition for funding government operations. The shutdown took at least $24 billion out of the U.S. economy, according to Standard & Poor’s.

The budget agreement was crafted by a bipartisan committee led by Ryan and Sen. Patty Murray, a Washington state Democrat.

“One of the things we had to learn to do is to listen to each other and to respect each other and to trust each other,” Murray, who leads the Senate Budget Committee, said on the NBC program.

Some of Ryan’s fellow Republicans balked at the deal because of the additional spending it allows by easing the automatic cuts. Still, the Republican-controlled House on Thursday passed the accord 322-94, with majority support from both parties. The Democratic-led Senate will begin considering the measure on Tuesday, with a final vote later in the week.

Ryan said he was frustrated with conservative groups that protested the bipartisan budget deal.

These groups are “very important elements” of the conservative movement, Ryan said on NBC. He added that such discussions should be kept “within the family.”

Ryan said he and House Speaker John Boehner of Ohio were frustrated that the groups voiced opposition to the budget agreement before it had been reached.

Ryan said he shares the same goals as the groups - trying to balance the budget and pay off debts without raising taxes - but they sometimes differ on tactics.

The compromise agreement is an important first step, he added.

Senate Majority Leader Harry Reid of Nevada predicted strong Democratic support for the budget deal.

“We’ll get our votes,” Reid said in an interview. “It would be suicide if the Republicans didn’t pass it.”

The White House supports the bill, according to a statement of administration policy released Wednesday.

Republicans will seek additional concessions from Democrats in order to extend the nation’s borrowing ceiling, Ryan also said Sunday. The debt limit, which was $16.7 trillion, was suspended until Feb. 7 as part of the October deal to end the partial shutdown. After that, the Treasury Department will be able to use so-called extraordinary measures to stave off default, such as suspending investments of a retirement fund.

Ryan said on Fox News Sunday that Republicans will meet after the holidays to determine what they’ll seek in exchange for raising the ceiling.

Ryan added there will be no so-called grand bargain, or a $1 trillion to $4 trillion deal on taxes and spending that previous budget negotiators have sought, as long as Obama is president and the Senate is controlled by Democrats.

“I don’t think with this president or this Senate we are going to have something like that,” Ryan said on Fox. “We need to win elections” to fix the country’s fiscal problems, he said.

Several Washington insiders warn against assuming the new budget deal will lead to progress on immigration and other stalemated issues.

“The president calls it a good first step, but to what?” said Bob Bixby of the bipartisan Concord Coalition, which advocates budget changes. “My fear is that it may be the end of the search for the larger grand bargain rather than the beginning. It has that feel.”

“Grand bargain” refers to a bipartisan accord that would start to slow the long-term cost projections of Social Security and Medicare while raising tax revenue to lower the deficit, among other things.

Some lawmakers see the glass half full. They hope the budget deal will cool partisan passions in 2014 and beyond.

“Maybe it’s something we can build on,” said Rep. Tom Cole, R-Okla. “Success begets success, and trust builds trust.”

Advocates talk of a possible piecemeal House approach to immigration change. Some influential lawmakers say the budget deal doesn’t necessarily brighten prospects elsewhere.

Former Sen. Alan K. Simpson, R-Wyo., said the budget deal is better than nothing. But “it’s a sparrow belch in the midst of a typhoon” that represents long-term fiscal challenges, he said.

Simpson co-wrote a major deficit-reduction plan that Obama commissioned, and then largely ignored, and he remains active in the debate.

The budget bill “is progress, and we don’t object to that,” Simpson said in an interview. “But if you don’t deal with the cost of health care, and you don’t deal with the solvency of Social Security for 75 years, you are failing your country.”

That applies to Congress and the president, Simpson said.

Information for this article was contributed by Greg Giroux of Bloomberg News and by Charles Babington and staff members of The Associated Press.

Front Section, Pages 1 on 12/16/2013