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Automatic Spending Cuts Set to Start After Congress Fails to Act

(Photo: Pete Souza / Flickr)

Washington – Sometime Friday, the federal government will take the first step toward cutting spending in dozens of departments and programs after the two major parties each tried and failed to muscle partisan alternatives through the Senate.

With the last-minute effort to avert the automatic spending cuts failed, the House of Representatives adjourned, the Senate wrapped up its scheduled business for the week, and most members went home.

That raised the stakes for a Friday meeting at the White House with President Barack Obama and the leaders of both parties in Congress as they debate how or whether they can change course in the days ahead as the spending cuts take effect over time

“Tomorrow I will bring together leaders from both parties to discuss a path forward,” Obama said after the congressional votes failed.

“As a nation, we can’t keep lurching from one manufactured crisis to another,” he said. “Middle-class families can’t keep paying the price for dysfunction in Washington. We can build on the over $2.5 trillion in deficit reduction we’ve already achieved, but doing so will require Republicans to compromise. That’s how our democracy works, and that’s what the American people deserve.”

With Congress gone, even a last-minute breakthrough agreement that no one expects likely would come too late to stop the first moves to start cutting $85 billion from this year’s $3.5 trillion budget.

Sometime before midnight – the 2011 law requiring the cuts stipulated only that they start going into effect on March 1 – Obama is expected to sign a directive ordering the White House Office of Management and Budget to start putting the cuts into effect. With much of the federal budget such as Social Security off limits, the cuts will be concentrated on a smaller part of the government, split evenly between defense and non-defense programs. Many will take weeks or even months to go into effect.

The 2011 law set the automatic cuts to force Congress and Obama to come up with a more palatable alternative to curb deficits by $1.2 trillion over 10 years. But Democrats insisted insisted on adding tax increases and smaller spending cuts. Republicans insisted that it all be done with spending cuts.

And that’s where they ended up again Thursday in the Senate.

Democrats proposed curbing projected deficits with a minimum 30 percent tax on millionaires, the closing of tax loopholes, and spending cuts to military and farm programs.

Republicans proposed keeping the same amount of spending cuts but giving Obama flexibility in how the cuts are implemented.

“What we’re about to go through is in some respects a charade because we know that the proposal on that (Democratic) side will not succeed with 60 votes,” said Sen. John McCain, R-Ariz. “The proposal on this side will not succeed with 60 votes. Meanwhile the clock moves on until some time tomorrow night.”

The Republican bill fell far short of the 60-vote threshold on a procedural vote and was defeated with 38 senators for and 62 against. Nine Republicans – McCain and Sens. Lindsey Graham of South Carolina, Marco Rubio of Florida, Rand Paul of Kentucky, Kelly Ayote of New Hampshire, Susan Collins of Maine, Ted Cruz of Texas, Dean Heller of Nevada and Mike Lee of Utah– voted against the measure. Two Democratic senators, Mark Warner of Virginia and Max Baucus of Montana, voted for the Republican bill.

The Democratic measure failed 51-49. Democratic Sens. Kay Hagan of North Carolina, Mary Landrieu of Louisiana, Mark Pryor of Arkansas and Senate Majority Leader Harry Reid of Nevada voted with Republicans against the bill.

Both sides seemed publicly cemented in their positions Thursday.

At the White House, Press Secretary Jay Carney mocked the Republican proposal, asserting that “no amount of flexibility changes the fact that these severe cuts threaten thousands of middle-class jobs and slash vital services for children, seniors, and our troops and military families.”

Obama hopes “that Republicans, whether it’s the short term or the long term, are ready to talk seriously about compromise and making sure that Washington is not inflicting wounds on the economy right when the economy should be growing and creating jobs,” Carney said.

Boehner and McConnell didn’t sound like they were in compromising moods Thursday.

“The president and the Democrat leaders have failed to pass a solution of their own,” Boehner told reporters. “My message at the White House will be the same as what I’m telling you today. It’s time for them to do their job.”

McConnell said he plans to make clear to Obama Friday that “the American people will simply not accept replacing spending cuts agreed to by both parties with tax hikes.”

“No more protecting waste and broken programs at the expense of those who actually need government help,” McConnell said. “The American people were promised more spending control, and Republicans are going to help them see that that promise is fulfilled – and in the smartest way possible.”

Even before Thursday’s votes and Friday’s meeting, congressional Democrats and Republicans were looking ahead, suggesting that the cuts could be restored, or at least reconsidered, in budget fights to come. That’s likely to come over the next three weeks when government funding expires March 27, requiring new budget legislation called a continuing resolution.

“What I would hope is that the Republicans there, both of them, would agree with their Republicans around the country that we should have a balanced approach to get rid of this and look forward to the sequestration, which is the 27th of next month,” Reid said. “It would be so easy to do. There are things that they’ve agreed to in the past on taking – getting rid of some of the tax loopholes and doing things of that nature that we could have a balanced approach.”

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