Congress Clears $1 Trillion Budget Measure in Rare Bipartisan Compromise

The U.S. Congress cleared a $1 trillion spending bill to avert a government shutdown.

The Senate yesterday voted 67-32 for the budget measure, with 30 Republicans opposed, one day after the House approved it 296-121. The bill, which funds the government for the rest of the fiscal year ending Sept. 30, 2012, now heads to President Barack Obama for his signature.

A stopgap plan keeping federal agencies operating was to expire Dec. 16, though Senate Majority Leader Harry Reid of Nevada had said the government should be unaffected if the Senate waited until yesterday to vote. To be safe, lawmakers passed another temporary measure funding the government one more day.

Lawmakers yesterday hailed the budget plan as a rare bipartisan compromise on spending in a year otherwise dominated by inconclusive debates over the U.S. budget deficit.

“This measure represents a victory for compromise, a victory for American taxpayers and a victory for bipartisanship,” said Senate Appropriations Committee Chairman Daniel Inouye, a Hawaii Democrat.

In the House, 86 Republicans voted against the bill; 149 Democrats supported it.

Funding Government Operations

The 1,200-page measure will fund the day-to-day operations of hundreds of government programs across 10 Cabinet agencies. It sets the budgets for the Departments of Defense, Education, Treasury, State, Health and Human Services, Homeland Security and Labor, among other agencies.

The spending bill had been snarled in a dispute over how to extend a payroll-tax cut into 2012 as well as expanded unemployment benefits, which also expire at year’s end. The Senate yesterday passed a two-month payroll tax cut extension, 89-10, sending it to the U.S. House.

Lawmakers made some last-minute changes to the spending measure, such as killing provisions targeting Obama’s Cuba policies. Republicans had included language blocking his decision to loosen restrictions on travel and sending money to the Communist country.

Representative Mario Diaz-Balart said it would “sell out the long-suffering Cuban people to appease the ruthless Castro dictatorship.”

Other Provisions

Representative Jose Serrano, a New York Democrat, said “the U.S. government should not be in the business of restricting travel to any country, no matter what the issues we have with their government.” He said “it is surreal to think that five decades after he took power, Fidel Castro is still a driving force in our national conversation.”

Some lawmakers complained the legislation was drafted behind closed doors and released only days before being put to a vote.

“One again, we find ourselves racing towards an 11th hour, panic-driven vote with no time to debate, review or amend an enormous spending bill,” said Senator Jeff Sessions, an Alabama Republican. “It is a sad commentary on Washington that legislation to fund much of our government for the entire year will spend mere hours on the Senate floor.”

Though lawmakers were unable this year to shrink entitlement programs or raise taxes to reduce the budget deficit, they agreed to cut the roughly 40 percent of the federal budget that must be approved each year by Congress.

‘Real Cuts’

“Make no mistake -- there are real cuts here,” said Representative Rosa DeLauro of Connecticut, the top Democrat on the House appropriations subcommittee with jurisdiction over education, health care and labor programs.

The bill cuts funding for Pell grants, which help 10 million Americans from low-income families attend college. Though the legislation maintains the current $5,550 maximum grant, it tightens eligibility standards in part by requiring recipients to have either a high-school diploma, general equivalency diploma or be home schooled.

It also reduces the maximum number of semesters students may receive grants to 12 from the current 18. Those changes may affect 250,000 Americans, according to a preliminary estimate by the American Council on Education, a Washington group that advocates for colleges and universities.

The bill also eliminates the six-month grace period students receive after they leave school during which they don’t have to pay interest on their student loans.

The administration’s Race to the Top program, which awards competitive grants to schools, would be reduced by 20 percent.

Foreign Aid

Foreign aid will decline, with the U.S. Agency for International Development’s budget cut by 17 percent, according to the Republicans’ summary. The Environmental Protection Agency will be cut by 3 percent, on top of reductions approved earlier this year. The Government Accountability Office, the investigative arm of Congress, will see a 6 percent reduction. The Internal Revenue Service will be cut by 2 percent.

Democrats fended off a number of Republican initiatives, including proposals taking aim at environmental regulations and cutting federal funding for Planned Parenthood and NPR, the syndicator of public radio stations.

Republicans prevailed with language targeting an administration initiative to promote energy-efficient light bulbs as well as provisions blocking public funding of abortions in Washington, D.C.

They also killed a Democratic proposal to increase the security fees charged to airline passengers. Airlines are charging more for checked baggage, Democrats complained, which was prompting more travelers to bring carry-on luggage and increasing the workload for the government’s security screeners.

To contact the reporter on this story: Brian Faler in Washington at bfaler@bloomerg.net

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

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