WASHINGTON – House and Senate negotiators have arrived at a two-year budget deal that modestly increases federal spending while offering lawmakers an opportunity to avoid another governmental shutdown.
Essentially, the deal announced Tuesday by Rep. Paul Ryan (R-Wis.), chairman of the House Budget Committee, and Sen. Patty Murray (D-Wash.), chairwoman of the Senate Budget Committee, eases the across-the-board spending plan instituted by the process known as sequestration, imposed as part of a previous budget agreement.
The Department of Defense, already hit hard by sequestration cuts and facing an additional $20 billion loss in January, benefits under the plan as do a handful of domestic programs. Spending overall for the 2014 fiscal year will go from $967 billion to $1.012 trillion, with an additional increase to $1.014 trillion in 2015.
The agreement would provide $63 billion in sequester relief over two years, split evenly between defense and non-defense programs. In fiscal year 2014, defense discretionary spending would be set at $520.5 billion and non-defense discretionary spending would be set at $491.8 billion.
The Bipartisan Budget Act of 2013 replaces $63 billion in automatic spending cuts by reducing spending in some targeted programs while increasing revenues without benefit of a direct tax increase. The plan extends a 2 percent cut to Medicare through 2023, two years beyond cuts contained in the Budget Control Act of 2011. The plan also increases airline ticket fees in an effort to offset security costs. Pensions for federal workers and military personnel will be cut.
Despite the spending increase the package manages to further reduce the budget deficit by $25 billion.
Both Murray and Ryan expressed optimism that their respective chambers will adopt the plan. The Republican caucus will have a chance to discuss it at their Wednesday morning conference meeting.
“This deal doesn’t solve all of our problems but I think it is an important step in helping to heal some of the wounds here in Congress,” Murray said. “Paul and I do have some major differences. We cheer for a different football team, clearly. We catch different fish. We have some differences on policy but we agree our country needs some certainty.”
Ryan expressed pride over the resolution, asserting that “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.”
The legislation fails to address several key issues. Some members of the budget conference committee hoped to include tax reform on the agenda and Democrats wanted to include a provision to extend federal unemployment benefits for another year. Neither made it into the final product. Nor did any attempt to repurpose the constant negotiations over the debt ceiling.
But the plan, should it pass both the House and Senate, will keep the government open beyond Jan. 15 – the day the current stopgap spending measure expires. And it offers a rare example of congressional bipartisanship.
Congressional conservatives, who are seeking deeper spending cuts without increasing taxes, generally reacted negatively toward the budget conference committee plan.
“I am concerned that this deal may be another missed opportunity by Congress to make the tough choices needed that will secure our long-term fiscal future,” said Sen. Dan Coats (R-Ind.). “I believe Congress needs to live by the budget levels it passed in 2011 or replace them with real, targeted spending reforms.”
Sen. Marco Rubio (R-Fla.) said the American public “deserves better than this.”