March 4 (Bloomberg) -- President Barack Obama offered to cut another $6.5 billion in government spending, a proposal rejected as inadequate by Republicans in negotiations over the federal budget and avoiding a government shutdown.
“This latest proposal is unacceptable, and it’s indefensible,” Senate Republican Leader Mitch McConnell said on the Senate floor today. “The American people are tired of hearing the same tired talking points from our Democrat friends. They want action.”
Michael Steel, House Speaker John Boehner’s spokesman, yesterday called the Obama proposal “little more than the status quo,” and said, “The American people have been clear that status quo spending in Washington is simply unacceptable.”
House Republicans last month passed a plan to cut $61 billion from 2011 spending, which would mean reductions of 10 percent or more in hundreds of programs. Democrats, who control the Senate, have balked at that measure.
White House National Economic Policy Director Gene Sperling told reporters yesterday, “We are willing to cut spending further if we can agree on cuts and find common ground in a way that does not do harm to the economy in the short term or in the long term through gutting education, research, innovation -- things that are critical to winning our economic future.” He didn’t identify which programs would be cut.
Meeting With Biden
Congressional leaders of both parties met behind closed doors yesterday with Vice President Joseph Biden to begin negotiations. Afterward, Biden issued a statement saying “the conversation will continue.”
Attending the meeting with Biden were the four top congressional leaders -- Boehner, of Ohio, House Democratic leader Nancy Pelosi of California, Senate Majority Leader Harry Reid, a Nevada Democrat, and McConnell, a Kentucky Republican -- as well as White House officials including Budget Director Jack Lew and Obama’s chief of staff, William Daley.
Obama signed a stopgap measure March 2 that cuts spending this year by $4 billion while funding most of the government at current budget levels until March 18. That gives lawmakers two weeks to decide funding levels for the fiscal year ending Sept. 30 or risk a shutdown.
Democrats have said extending current budget levels through Sept. 30 would amount to $41 billion in savings when compared with the 2011 budget request Obama released last year.
Sperling argued that combined with $4 billion cut in the stopgap measure and the $6.5 billion spending decrease administration now was offering, the total would amount to roughly half of the $100 billion Republicans had pledged last year to cut from the president’s 2011 budget request.
That request never advanced in last year’s Congress and the government has continued to be funded at 2010 levels.
House Majority Leader Eric Cantor, a Virginia Republican, rejected the Democrats’ math. “That’s unacceptable to our side,” he said. “It’s unacceptable to the American people.”
Cantor said his colleagues want the equivalent of $2 billion in cuts per week through Sept. 30. That would track with the $61 billion in cuts sought by the House bill.
White House spokesman Dan Pfeiffer said before the meeting Biden convened that “while there may be some disputes on math and some other things heading into this, we remain optimistic we’re going to be able to get this done.”
Environment, Health Care
McConnell said that in the Senate version of a budget bill he would seek the $61 billion in cuts approved by the House, though he hasn’t endorsed that measure’s specific cuts. The bill’s provisions include spending reductions in programs affecting education, the environment, health care, energy, science and the arts. The Peace Corps budget would be cut by 20 percent and the maximum Pell college tuition grant would be slashed by 15 percent.
Some Senate Republicans say they won’t vote for any budget bill that contains less than the $61 billion in cuts. “I can’t under any circumstances vote for anything less than that,” said South Carolina Republican Jim DeMint.
The negotiations also must resolve a number of policy measures approved by the House, including a ban on funds for Obama’s health-care overhaul and for Planned Parenthood, which provides abortions. Democrats want those provisions deleted.
Some Democratic lawmakers said they don’t want to focus on spending cuts until Congress considers ways of raising more federal revenue through taxes, such as increases on those earning more than $250,000 a year or ending breaks for oil and gas companies.
“I’m not going to vote for anything unless there’s revenues in it,” said Senator Tom Harkin, an Iowa Democrat. “From now on, if there’s something that’s just cutting spending, I’m not for it. We’ve got to do both.”
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