Congressional budget negotiators have reached a two-year agreement aimed at avoiding a government shutdown on Jan. 15, cutting $23 billion from the federal deficit and stopping the huge sequestration cuts targeting the Pentagon over the next two years.
"This budget is a step in the right direction," Rep. Paul Ryan of Wisconsin, the GOP chairman of the House Budget Committee, said at a Tuesday evening news conference. "It is a clear improvement on the status quo."
"It cuts taxes in a smarter way — and it reduces the deficit without raising taxes," Ryan added.
"We have broken through the partisanship and the gridlock, and we have reached a deal," Democratic Sen. Patty Murray of Washington, who head the Senate Budget Committee, said at the news conference with Ryan. "Over the past few years, we have lurched from crisis to crisis."
The new $85 billion deal should win passage in the House of Representatives with Republican support, Ryan said. He called the deal a "step in the right direction," that would avoid threats of another government shutdown in January, when current funding expires, and in October next year, when the next fiscal year starts.
"What am I getting out of this? I'm getting more deficit reduction. So the deficit will go down more by passing this than if we did nothing," he told a news conference.
The top Republicans in Congress said that while the bipartisan budget deal is "modest in scale," it represents a positive step forward."
Speaker of the House of Representatives John Boehner also said the agreement would help cut the record budget deficit "without tax hikes that would hurt our economy."
Ohio Sen. Rob Portman, a member of a larger congressional budget panel said he is pleased the deal will help avoid a government shutdown.
"I'm happy we're going to avoid raising taxes, going to stay within the budget caps and, in addition, have some deficit reduction," he said.
President Barack Obama praised the budget deal as a "good first step" to overcome recurring crises that have wracked the government since 2011.
"It's a good sign that Democrats and Republicans in Congress were able to come together and break the cycle of short-sighted, crisis-driven decision-making to get this done," the president said of the agreement that, if passed, would avoid a disastrous repeat of a government shutdown that paralyzed Washington in October.
The new budget deal that will be debated by the U.S. Congress in the coming days would trim some military spending as well as outlays for federal workers' retirement programs, Senate Budget Committee chief Patty Murray said on Tuesday.
The deal would cut $12 billion from the two accounts, the Democratic senator said. Murray also said that congressional leaders are discussing the possibility of extending some expiring federal benefits for the long-term unemployed but that such legislation will not be included in the two-year budget deal.
Tim Phillips, president of Americans for Prosperity, is urging Republican legislators to "stand firm" in opposing any budget deal that would increase spending.
"Otherwise, congressional Republicans are joining liberal Democrats in breaking their word to the American people to finally begin reining in government over-spending that has left us over $17 trillion in debt," he said.
Heritage Action, the lobbying arm of the Heritage Foundation, said it could not support any such budget deal.
The emerging plan would increase spending "in the near term for promises of woefully inadequate long-term reductions," the group said.
It remains uncertain whether any budget plan would pass both houses of Congress. The House could vote on it by Friday. If the deal passes the House, the Senate, which is controlled by Democrats, is likely to vote on it late this week or early next week.
Should Congress approve the deal, it could end fierce budget standoffs in the immediate future — including the one that led to the 16-day government shutdown in October because federal agencies ran out of money — and enable lawmakers to write annual spending bills in a more orderly fashion.
Congress has not enacted a budget bill since 2009.
Without a deal, another shutdown could occur on Jan. 15, when current funds for most agencies are expected to run out.
If left in place, the reductions would carve $91 billion from the daily budgets of the Pentagon and domestic agencies when compared with spending limits set by the 2011 budget agreement.
Backing for a budget plan to ease the reductions is strongest among defense supporters in both houses and in both parties, who fear the impact on military readiness from a looming $20 billion cut in Pentagon spending.
Senate Democrats hope to get the support of at least five Republicans who want to ease the Pentagon's automatic spending cuts.
While Republicans are pushing against limiting the sequestration cuts, Democrats do not want an agreement that seeks greater pension contributions from federal workers without requiring sacrifices from wealthier Americans.
Further, Democrats also are pushing for an extension of federal benefits for the long-term unemployed, which are set to expire at the end of this month.
Republicans are objecting to the extension, citing a falling jobless rate.
"I am cautiously optimistic that we have a deal," said Barbara Mikulski, the Maryland Democrat who heads the Senate Appropriations Committee.
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