Obama’s Budget Talks With Ryan Obscure Immediate Needs

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House Budget Committee Chairman Paul Ryan said his budget is premised on Congress voting to repeal the health-care law that is set to take effect in January. Close

House Budget Committee Chairman Paul Ryan said his budget is premised on Congress... Read More

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Photographer: Win McNamee/Getty Images

House Budget Committee Chairman Paul Ryan said his budget is premised on Congress voting to repeal the health-care law that is set to take effect in January.

Paul Ryan, chief House Republican budget writer, today unveils his 2014 budget. Patty Murray, his Senate Democratic counterpart, will craft her chamber’s first fiscal blueprint in years. President Barack Obama will discuss deficit-cutting with lawmakers in four Capitol Hill meetings.

None of this flurry of activity will have an immediate effect. The most important budgetary event this week will be the U.S. Senate taking up legislation to finance the government for the next six months. It will keep in place $85 billion in automatic spending cuts that no one says they want.

The 2014 House and Senate budget blueprints from Ryan and Murray will spell out long-term proposals and won’t relate to spending for the remainder of fiscal 2013, which ends Sept. 30.

“We are in sort of a budgetary nightmare,” said Steve Ellis, vice president of Taxpayers for Common Sense, a Washington-based group that tracks federal spending. “We have a bunch of head-feints and ghosts around and we do not know what is reality and what is not.”

The one action that will translate into immediate results is a stopgap spending bill, known as a continuing resolution, to fund the government through the current fiscal year, Ellis says. The bill would provide several government agencies flexibility in executing across-the-board spending cuts that took effect March 1 while keeping them in place, said Appropriations Committee Chairwoman Barbara Mikulski.

Budgetary Optics

Yet, most attention will be focused elsewhere, notably on Obama’s visits with lawmakers to prepare for a renewed round of deficit-reduction talks. He will meet with both parties’ House and Senate caucuses separately over three days.

“Some of this is about appearing to be busy,” Ellis said in an interview. “This week is all about optics and theater. Constructive discussions will take place behind closed doors and not necessarily this week.”

Differences over long-term budget issues aside, lawmakers in both parties and the president agree they want to avoid a federal shutdown. To that end, the Senate plan will build on legislation passed by the House on March 6 to finance the government after its spending authority expires on March 27.

The House measure would give the Defense and Veterans Affairs departments more leeway to decide how to implement the automatic spending cuts, known as sequestration.

Flexibility

Senate Democrats are seeking a bipartisan agreement to give more spending flexibility to additional agencies, including Commerce, Agriculture, Justice and Homeland Security, Mikulski said.

Her goal is to add specific spending language for programs that are “relatively free of controversy,” she said.

The top Republican on the Appropriations Committee, Senator Richard Shelby of Alabama, supports that approach. Mikulski, a Maryland Democrat, and Shelby jointly filed the stopgap measure late yesterday.

The Senate’s stopgap spending debate will be obscured by the dueling budgetary blueprints for the longterm.

On “Fox News Sunday,” Ryan said his budget is premised on Congress repealing the Affordable Care Act of 2010, Obama’s health-care law set to take full effect in January. That assumption rests on the unlikely possibility that the Democratic-controlled Senate would repeal the centerpiece of the president’s domestic policy agenda.

The Senate proposal by Murray will be considered by the Senate Budget Committee tomorrow and March 14. The Washington Democrat has said her plan will include further tax increases on top earners, in addition to the rate increase Congress approved in January. Unlike Ryan’s plan, it wouldn’t balance the budget in 10 years.

No Agreement

Still, while both chambers could pass their own budget blueprints for 2014, they are not expected to agree to a joint budget resolution.

Yet, the exercise could serve as “the opening position for each side” to discuss a larger deficit-reduction deal when U.S. borrowing authority expires May 19, Representative Tom Cole, an Oklahoma Republican, said in an interview.

Cole said he wouldn’t expect the House to “achieve all the objectives of the Ryan budget,” or impose on Senate Democrats a plan to balance the budget in 10 years. Yet “Americans are willing to be flexible about means and timing but I think they want a goal,” Cole said.

Cole also said the outreach by the president is “welcome” and could presage whether Democrats and Republicans can sit down to discuss a larger budget deal. He hasn’t met with House Republicans as a group since 2011.

Obama’s Challenge

Obama will have to overcome an image of aloofness and resentment among some lawmakers who complain that he has waged a campaign-style effort to pressure them into accepting more tax revenue.

“Most Republicans have never talked with President Obama,” said Ron Bonjean, a Republican strategist who was an aide to former House Speaker Dennis Hastert.

The president visited a House Republican conference in the Capitol in January 2009, shortly after he took office. A year later, he accepted a House Republican invitation to visit their annual issues retreat in Baltimore. At the insistence of the White House, Obama’s meeting was open to the media.

Peter Roskam, a former colleague of Obama in the Illinois legislature, told the president he had “rolled your sleeves up, you worked with the other party” to “make the deal” on “big things.”

‘Stiff-Armed’

“That attribute hasn’t been in full bloom” as Republicans have “really been stiff-armed” by Democrats, Roskam said. In reply, Obama said, “both sides can take some blame for the sour climate on Capitol Hill.”

Obama’s latest outreach included a dinner with a dozen Senate Republicans at a hotel several blocks from the White House and lunch with Ryan and and Maryland Representative Chris Van Hollen, the top Democrat on the House Budget Committee.

After forcing Republicans to go along with more than $600 billion in tax increases in January, the president ‘has no more leverage’’ over Republicans, Bonjean said. So now “he has been forced to negotiate with Republicans with the hopes of trying to find a deal.”

To contact the reporters on this story: Roxana Tiron in Washington at rtiron@bloomberg.net; James Rowley in Washington at jarowley@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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