WASHINGTON // A bipartisan budget deal announced this week in the US Congress, while modest in its spending cuts, would end nearly three years of partisan stand-offs between Democrats and Republicans that culminated in October with a partial government shutdown.
Democratic Senator Patty Murray and Republican Representative Paul Ryan appeared before reporters on Tuesday to announce the US$85 billion (Dh 312bn) budget accord, which still must be approved by the full Senate and House of Representatives.
“For far too long compromise has been considered a dirty word,” Sen Murray said, adding that the uncertainties created by three solid years of Washington bickering “was devastating to our economic recovery.”
Rep Ryan, the Republican Party’s 2012 failed vice presidential candidate who has his eye on either a 2016 presidential campaign or potentially a House leadership job, wasted no time in trying to blunt criticisms of the pact, especially from fellow conservatives.
“In divided government, you don’t always get what you want,” he declared.
But he added, “I think this agreement is a clear improvement on the status quo. This agreement makes sure that we don’t have a government shutdown scenario in January. It makes sure we don’t have another government shutdown scenario in October. It makes sure that we don’t lurch from crisis to crisis.”
It would blunt the effect of automatic “sequester” spending cuts by allowing federal agencies and discretionary programs to spend $63 billion (Dh231.4bn) more over two years, while savings are made elsewhere. It also would provide an additional $20 billion (Dh73.4bn) to $23 billion (Dh84.4bn) in deficit reduction over 10 years.
The accord was uncharacteristic for a Congress that in the past has found little common ground and has waited until the absolute last moments to reach stop-gap agreements on the budget and on raising US borrowing limits to avert historic debt defaults.
The House is likely to put the deal to a vote by tomorrow, before recessing for the year, and a Senate vote might come next week.
Not addressed in this budget deal is the need sometime next year to again raise US borrowing authority.
The reaction from at least one market-watcher was positive. “It is certainly a good start to what would be welcomed relief from the fiscal dysfunction that has defined Washington,” said Craig Dismuke, chief economic strategist at Vining Sparks in Memphis.