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Democrats, Republicans in Standoff on Spending as Shutdown Looms

Wednesday, 23 Feb 2011 07:18 AM

 

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Congressional Republicans and Democrats are preparing dueling plans to avert a U.S. government shutdown early next month as both sides refuse to budge so far in their standoff over spending cuts.

Senate Majority Leader Harry Reid of Nevada said he will bring up a temporary spending measure next week to keep the government operating at current levels into early April and buy time for talks on a longer-term plan.

Democrats oppose the House Republicans’ spending plan, passed Feb. 19, saying its $61 billion in cuts will harm the economy and the nation’s security. The White House says President Barack Obama would veto the measure, which would fund the government through Sept. 30.

“We want them to come to the table with us, work out a responsible path forward,” Reid told reporters in a conference call yesterday. “We’re proposing a short-term solution that will give us time to negotiate.”

There isn’t much time. Current spending authority expires March 4, and if Congress doesn’t enact a new plan by then the government will shut down. Congress is in recess this week.

House Speaker John Boehner rejected Reid’s proposal for a stopgap measure without additional cuts, insisting as he has previously that any new funding bill contain more spending reductions. If Reid refuses to act on the Republicans’ measure, the House will take up a temporary one “that also cuts spending,” Boehner said in a statement.

‘Mountain of Debt’

“Senate Democratic leaders are insisting on a status quo that has left us with a mountain of debt and a stalled economy with unemployment near 10 percent,” said Boehner of Ohio “Republicans’ goal is to cut spending and reduce the size of government, not to shut it down.”

The leaders’ statements set the stage for behind-the-scenes talks in which Democrats and Republicans will haggle over how much, and where, to slash federal spending. Reid said he was sending his top aide to start private discussions with a counterpart in Boehner’s office about a longer-term deal.

Boehner said Democrats “should stop creating more uncertainty by spreading fears of a government shutdown and start telling the American people what -- if anything -- they are willing to cut.”

Each side has indicated openness to a deal. Senate Budget Committee Chairman Kent Conrad of North Dakota said Feb. 19 the Democratic-controlled chamber would accept about half of the spending cuts Republicans are demanding for this year.

‘Got to Cut Spending’

“I think virtually everybody understands we’ve got to cut spending,” Conrad said in an interview on Bloomberg Television’s “Political Capital with Al Hunt.”

Republican Senator Lindsey Graham of South Carolina said he would consider supporting reductions far smaller than the House recently approved as part of a stopgap bill.

“We ought to take every opportunity to reduce spending, so I’d like to cut spending even for two weeks,” Graham said Feb. 18. “I’m a practical guy -- but I don’t want to play this game much longer.”

In addition, a half-dozen Republican and Democratic senators are meeting privately in an effort to reach a broader bargain to reduce the deficit, projected to reach $1.6 trillion this year.

Those talks are also being prodded by another deadline: the Treasury Department projects the U.S. debt will reach its authorized ceiling of $14.3 trillion within a few months, and Republicans have said they want deeper spending cuts as a condition of voting to raise it.

‘Work Together’

In the dispute over this year’s spending, each side is accusing the other of risking the consequences of a government shutdown.

“It is time to drop the threats and ultimatums, and work together on a path forward,” Reid said in a statement announcing his plans.

House Majority Leader Eric Cantor, a Virginia Republican, made his own push for bipartisan talks.

“A government shutdown is not an acceptable outcome, and I call upon Leader Reid to commit to a good-faith effort to work with us and take that threat off the table,” Cantor said in a statement.

Democrats say they’ve already agreed to some cuts by embracing current spending levels of $41 billion less than Obama proposed.

‘Far Apart’

Senator Chuck Schumer of New York, the third-ranking Democrat, said current spending levels represent “a huge cut that we’ve already put on the table” as part of a budget deal reached in December. Republicans and Democrats, he added, are “far apart, not on whether we should cut, but on what we should cut.”

Republicans counter that the budget now in effect locked in huge spending increases over the last few years.

Senate Minority Leader Mitch McConnell, a Kentucky Republican, said Reid’s proposal showed Democrats “can’t find a single dime of federal spending to cut” and are “insisting on the status quo, even for a short-term spending bill.”

White House Press Secretary Jay Carney said yesterday Obama’s team agrees with congressional leaders that “we do not want a shutdown of the government and that we can come to an agreement that avoids that.”

Federal agencies are prepared “for any contingency,” Kenneth Baer, a spokesman for the White House Office of Management and Budget, said in an e-mail. Still, “this is beside the point” because Obama and lawmakers have said “no one anticipates or wants a government shutdown,” he said.


© Copyright 2014 Bloomberg News. All rights reserved.

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