By: Jake Sherman and John Bresnahan
December 5, 2013 07:25 PM EST
Rep. Paul Ryan and Sen. Patty Murray are only a few billion dollars in budgetary savings away from a deal that would set spending levels and blunt the impact of across-the-board spending cuts for the next two years, according to sources close to the negotiations.
But hurdles remain, as finding those few billion dollars is difficult in an already tight federal budget.
Ryan and Murray — who chair the House and Senate Budget committees respectively — will work through the weekend to try to craft the ever-elusive budget agreement. Their self-imposed deadline is Dec. 13, which is next Friday. After then, Speaker John Boehner (R-Ohio) vows he will send the House home for Christmas with or without a budget agreement.
If the two sides reach an agreement, it will represent a significant breakthrough in Washington’s budget wars. Just two months ago, disagreements over federal spending resulted in the first government shutdown in 17 years.
Optimism is still tough to come by in budget negotiations, since Boehner, President Barack Obama and Senate Majority Leader Harry Reid (D-Nev.) have failed multiple times over the last few years to craft a deficit reduction package. But this time, Ryan and Murray settled on a more modest approach. It could reach the House floor next week.
If there’s no budget deal, the federal government — including the Pentagon — will operate on $967 billion in discretionary spending next year. Many Republicans and Democratic lawmakers believe that figure is too low and would result in cuts for vital programs.
Ryan, a Wisconsin Republican, and Murray, a Washington state Democrat, are discussing spending near $1 trillion in 2014, but keeping sequester level deficit reduction by finding alternative reductions in the federal budget.
There will be new revenue flowing into government coffers in any budget agreement, but not by the way of additional taxes, which Boehner, Ryan and other Republican leaders have adamantly ruled out.
Instead, Ryan and Murray are looking toward increased fees on airline tickets and other cost increases passed along as “user fees” for government services.
House GOP leaders are already beginning to talk to other key Republican figures about selling revenue increases. Rep. Dave Camp, the Michigan Republican who chairs the Ways and Means Committee, told a group of senior Republicans Thursday that he has spoken with Club for Growth president Chris Chocola about revenue raisers. And other critical figures are expressing openness to allowing more governmental revenue.
“That sort of thing is a user fee, it’s not a tax,” said Rep. Tom Cole (R-Okla.), a member of the bipartisan, bicameral budget talks. “It’s not something that I would have an objection to as a tax increase. But we’ll see where [Ryan and Murray] end up.”
In a move sure to infuriate Democrats, the House-Senate negotiators have all but settled on slicing billions of dollars from federal employees retirement plans, according to sources familiar with the talks. It will be a potential problem for some Democrats, especially those from the Washington metropolitan area — a prime example is House Minority Whip Steny Hoyer (D-Md.), who is vehemently opposed to these cuts. Hoyer and fellow Maryland Democratic Rep. Chris Van Hollen (D-Md.) represent districts flush with federal workers. They have both raised concerns about those cuts.
At this stage in the talks, House and Senate negotiators are also beginning to discuss a patch to the sustainable growth rate for Medicare, the formula by which the government calculates payments for doctors who treat Medicare patients, according to sources close to the talks.
Ryan and Murray, though, remain very tight-lipped on the status of their discussions, even with their own colleagues. Ryan briefed House leaders Thursday, but said little, according to sources familiar with the briefing. On Thursday, Ryan told a POLITICO reporter that if he wanted a comment for a story, the reporter should simply copy yesterday’s brief statement from Ryan “and paste it in your article for today.”
If Congress cannot pass a budget deal, the nation’s fiscal picture is murky. Democrats loathe the $967 billion spending level mandated by the 2011 Budget Control Act. And Republicans on the Armed Services and Appropriations committees would be pained if they had to pass a government funding bill that low. Armed Services because they think it hurts the military, and Appropriations because they hate running the government by stopgap measures known as continuing resolutions.
Appropriations Committee Hal Rogers (R-Ky.) said he thinks his committee would grudgingly fall in line if asked to support a funding resolution at the $967 billion level. Asked if he’d be happy to vote for it, Rogers said, “My happiness is not of the concern of the House.”
Moving a package like this through the House won’t be easy. Democrats are uneasy about a budget deal that doesn’t include an extension of federal unemployment benefits — House Republicans appear disinterested in extending that program. The White House Council of Economic Advisers and the Labor Department have estimated that 1.3 million unemployed workers would immediately lose their benefits if the program isn’t extended beyond the Dec. 28 expiration date. House Minority Leader Nancy Pelosi (D-Calif.) hinted she wouldn’t support a budget deal if it didn’t include that extension, but she later walked those comments back.
Boehner didn’t seem appear concerned with the lapsing federal benefits, saying that, “If the president’s got a proposal I’ll look at it.” Pressed for his opinion, Boehner said, “I’m not the expert, talk to the chairman of the Ways and Means committee.”
“If there’s a real economic recovery, you don’t need unemployed [benefits] at this level for this extended period of time,” said Cole, a member of the bipartisan talks.
Representing the conservative resistance, nearly 20 prominent hard-line Republicans — including Reps. Mick Mulvaney (S.C.), Jim Jordan (Ohio) and Steve Scalise (La.) — are calling on Boehner and Majority Leader Eric Cantor (R-Va.) to try to pass a so-called “clean” continuing resolution at the sequester level of $967 billion for fiscal year 2014.
In a letter to Boehner and Cantor, the conservatives said Democrats want a government shutdown to distract from Obamacare’s woes.
However, House insiders noted that a number of these conservatives, including the trio of Mulvaney, Jordan and Scalise, had signed onto a letter in April which called for the House to approve all appropriations bills, and forgo the type of stopgap measure they’re now calling for.