(MENAFN– ecpulse) After two weeks of negotiations, a bipartisan deal was announced in the U.S. Congress on Tuesday, which would end three years of impasse and fiscal instability in Washington and avert another economy-shattering government shutdown
Senator Patty Murray (D., Wash.) and Republican Paul Ryan (R., Wis.), who struck the deal after weeks of private talks, said it would allow more spending for domestic and defense programs in the near term, while adopting deficit-reduction measures over a decade to offset the costs.
The deal calls for a $63 billion increase in spending in 2014 and 2015, which would be paid for with higher fees for airline travelers and changes in federal employee and military pension programs. It includes permanent changes to other programs that would end up reducing the deficit by $22.5 billion over the next decade.
The plan is modest in scope, compared with past budget deals and to once-grand ambitions in Congress to craft a "grand bargain" to restructure the tax code and federal entitlement programs.
But in a year and an institution characterized by gridlock and partisanship, lawmakers were relieved they could reach even a minimal agreement.
"In divided government, you don`t always get what you want,`` said Mr. Ryan in announcing the deal.
The deal, which goes to the House and Senate for approval in the coming days, marks a major change in the landmark 2011 budget-cutting law, which set in motion 10 years of fiscal austerity, including across-the-board spending cuts known as sequestration.
The annual discretionary spending target will be raised to $1.012 trillion in 2014 and $1.014 trillion in 2015 under the accord.
The deal achieves some of those savings by extending an element of the 2011 budget law that was due to expire in 2021. The sequester currently cuts 2% from Medicare payments to health-care providers from 2013 through 2021. The new deal extends those cuts to 2022 and 2023.
President Barack Obama on Tuesday praised the budget deal as a good start and urged the U.S. Congress to quickly pass a budget based on the accord.
"Today`s bipartisan budget agreement is a good first step," Obama said in a statement. "I want to call on members of Congress from both parties to take the next step and actually pass a budget based on this agreement so I can sign it into law."
Conservatives Already Opposed
Conservative groups including Americans for Prosperity and Heritage Action for America registered their opposition on Monday, with the latter complaining that the deal increases spending "in the near-term for promises of woefully inadequate long-term reductions."
Senator Marco Rubio declared his opposition to the plan just after it was announced. "We need a government with less debt and an economy with more good-paying jobs, and this budget fails to accomplish both goals," he said. "In the short run, this budget also cancels earlier spending reductions, instead of making some tough decisions about how to tackle our long-term fiscal challenges caused by runaway Washington spending."
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