Reply #9: House Passes Compromise Budget Bill

[ProgressiveEconomist]

Source: NY Times

By JENNIFER STEINHAUER and CARL HULSE April 14, 2011

WASHINGTON Œ The House on Thursday passed compromise legislation to finance the federal government through the end of the fiscal year in September. The vote brought one budget clash to a close even as the Democrats and Republicans prepared for another. The vote was 260-167, with 59 Republicans breaking ranks with their party leadership to vote against the deal, which calls for $38 billion in spending cuts this year. The Republican defections, a result of opposition from conservatives who said the bill did not do enough to rein in spending, forced the House speaker, John A. Boehner of Ohio, to turn to Democrats to pass the bill and keep the government from shutting down. Afterward, the bill moved to the Senate, where it was expected to pass quickly and be sent to President Obama€s desk. ...

Before the vote, Mr. Boehner pushed back against criticism that the agreement he struck with President Obama and Senate Democrats relied too heavily on budget gimmicks. €These are real cuts,™ Mr. Boehner said, adding that those who thought that some of the reductions were illusory because the money would not have ultimately been spent were €kidding themselves.™ ... The Republican leadership had hoped to avoid depending on Democratic votes to pass the bill because party fissures could weaken Mr. Boehner in coming budget negotiations. But in the end, the bill would have failed without them. Eighty-one Democrats backed the bill, while 108 voted against it. Among freshman Republicans, many of whom won office last November on promises to rein in spending, 60 voted in favor while 27 said no. Mr. Boehner and his allies have been working over the past few days to contain conservative criticism that the spending legislation was inadequate, falling well below initial Republican aspirations
for $61 billion. ...

The resistance to the spending measure came after reviews of the proposal found that many of its significant cuts, including some involving health care, would not reduce federal spending now because the money in question was not likely to be spent for years, though budget rules allow the cuts to be counted as a current reduction. According to a Congressional Budget Office report, the bill would produce only $350 million in tangible savings this year, in part because cuts in domestic programs were offset by an increase of about $5 billion for Pentagon programs. When projected emergency contingency spending overseas is figured in by the budget office, estimated outlays for this year will actually increase by more than $3 billion. ..."
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Read more: http://www.nytimes.com/2011/04/15/us/politics/15congress.html?_r=1&pagewanted=print