Biden Says $33 Billion in Spending Cuts Weighed in Talks on U.S. Budget

House Speaker John Boehner sought to prepare Republican Tea Party supporters for a compromise on spending cuts, after Vice President Joe Biden announced a potential breakthrough in efforts to avoid a government shutdown.

With Tea Party activists rallying today near the Capitol to support deep spending cuts, Boehner cautioned that an agreement with Democrats is necessary because Republicans only “control one half of one-third of the government here in Washington.”

“We can’t impose our will on the Senate,” which is controlled by the Democrats, said Boehner. “All we can do is to fight for all of the spending cuts we can get an agreement to.”

The potential breakthrough in talks was announced late yesterday by Biden as aides from both parties began crafting a proposal with total spending cuts of about $33 billion in the 2011 budget.

The figure, below the $61 billion approved by the Republican-controlled House last month, could lead to a final deal for the fiscal year that ends Sept. 30, Biden said.

“We’re talking,” Boehner said today, refusing to provide details of the discussions. “There is no agreement on numbers and nothing will be agreed to until everything is agreed to.”

April 8 Deadline

Boehner, of Ohio, said he “would hope” a deal will be reached to keep federal agencies operating before the current spending measure expires April 8. He said it was time to move the debate beyond a fiscal year that ends Sept. 30.

In the Senate, second-ranking Republican leader Jon Kyl of Arizona said the overall level of cuts being pursued could be acceptable if it allows lawmakers to turn attention to next fiscal year’s budget and to an increase in the nation’s $14.3 trillion debt ceiling.

“I think everybody recognizes that it is now time to get something done,” Kyl said in an interview. “We can’t continue what we have been doing. So the pressure to compromise has been increased on all sides.”

Biden, following a closed-door meeting last night with Senate Democratic leaders, said no final agreement had been reached on the level of cuts and that many details remain to be worked out.

“There is no reason why, with all that is going on in the world and with the state of the economy, we can’t reach an agreement and avoid a government shutdown,” the vice president said.

‘Positive’ Direction

White House spokesman Jay Carney said today the budget talks are moving in a “positive” direction. The negotiations have produced a “general agreement” on a target amount for budget cuts, he said.

Aides from both parties yesterday resumed talks that stalled last week when Republicans said proposed Democratic cuts weren’t deep enough.

Boehner said Republicans will fight to preserve the policy provisions the House included in its budget bill. The dozens of so-called riders include a ban on funding this year to implement the health-care overhaul and federal grants to Planned Parenthood of America, a federation of reproductive health centers that provides abortion services.

As fiscally conservative Tea Party activists who propelled the Republican takeover of the House in last November’s elections held their rally, Boehner acknowledged the pressure to fight for deep spending cuts.

“We got a lot of people in Washington who want to do a lot of different things,” he said. “We promised the American people we would fight to cut spending.”

Reid Priorities

Senate Majority Leader Harry Reid, a Nevada Democrat, vowed to defend his party’s priorities as talks center on which programs will face the budget ax.

A deal “will not come on the backs of middle-class families and the jobs they need,” he said on the Senate floor today. “It will not come if the other side continues to insist on Tea-Party unrealistic cuts.”

Senate Democrats and the White House initially pieced together a proposal that would bring the 2011 cuts to about $30 billion, including $10 billion in reductions already approved in stopgap spending bills. Democrats said the offer was close to the level of cuts House Republican leaders had sought earlier this year before their rank-and-file demanded deeper ones.

Veto Threatened

President Barack Obama has threatened to veto the House- passed spending measure, arguing the $61 billion in cuts would hurt the nation’s economic recovery.

The last government shutdown occurred in late 1995 and early 1996 in a budget dispute between Democratic President Bill Clinton and the Republican-controlled House and Senate. In its wake, the Republicans suffered the most political blame.

To contact the reporters on this story: Laura Litvan in Washington at   or llitvan@bloomberg.net; James Rowley in Washington at jarowley@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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