House Budget Chairman Paul Ryan (R-WI) and Senate Budget Chairwoman Patty Murray (D-WA) announced a budget deal which will need to be voted on by Congress. The Deal replaces $63 billion in sequester cuts with other savings and non-tax revenues, and it includes an additional $22.5 billion in deficit reduction. In addition, the bill does not extend federal unemployment benefits for the 1.3 million long-term unemployed Americans.
The Deal calls for setting top line spending at $1.012 trillion for fiscal 2014 (which began in Oct 2013) and $1.014 trillion for fiscal 2015. Democrats are not happy over the lack of new taxes and the fact that there are proposed cuts to the federal employee pension system. One has also opined that this bill won’t create jobs or meaningfully cut the deficit.
My answer to that is that the federal government is not a good creator of jobs, that is best left to the private sector and that the Congress of the last five years has no room to talk about meaningfully reducing the deficit.
Republicans are not happy because the proposed top-line spending figures are higher than they would like. Their top end for this year’s budget was $967 billion. Several leading Republicans have already come out against this Deal.
I am encouraged by the fact that both parties have vocal members who don’t like the Deal. That tells me that this really is a compromise in that both ideologies are dissatisfied and have to give up something. I like the fact that there are no new tax revenues and that the deficit is attacked, even if ever so slightly.
The details are a long way from being hammered out, and Congress could keep the Deal from seeing the light of day, but for now it is encouraging to see that we may avert another nasty round of political theater. I take my hat off to Ryan and Murray on a difficult compromise.
