News / USA

US Lawmakers Often at Odds in Search for Budget Compromises

The US Capitol Dome is seen in the distance as American flags fly on the National Mall around the base of the Washington Monument in Washington, D.C., Oct. 15, 2013.
The US Capitol Dome is seen in the distance as American flags fly on the National Mall around the base of the Washington Monument in Washington, D.C., Oct. 15, 2013.
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VOA News
With the U.S. government shutdown over, fractious lawmakers now face a difficult task in resolving significant differences over the country's spending priorities and taxation.

U.S. President Barack Obama, a Democrat, and his Republican opponents in Congress have been unable to reach agreement on an overall government budget during most of his five years in the White House. The Congress has often adopted crisis-driven measures to keep the government operating.

Key lawmakers started discussions Thursday to try to reconcile wide differences in the 2014 budgets approved by Congress' two chambers, the Democratic-controlled Senate and the Republican-led House of Representatives. In the U.S., liberal Democrats generally support more government spending for social programs and higher taxes on the wealthy, while conservative Republicans regularly call for tax cuts and a diminished role for government.

The deal to end the 16-day partial shutdown and increase the country's borrowing authority calls for the negotiators to reach a spending agreement spending by mid-December. That would be a month ahead of a mid-January deadline when government funding runs out.

One U.S. economic analyst, Jim O'Sullivan of High Frequency Economics, said that he did not expect the negotiators to be able to reach a long-term deal.

"I wouldn't expect any big grand bargain in terms of multi-year deficit reduction to come out of this," he said.

Rather, O'Sullivan said he expected the negotiators would try to figure out ways to limit scheduled mandatory cuts that would curtail U.S. defense spending.

In a White House speech, Obama laid out his priorities.

"The key now is a budget that cuts out the things that we don’t need, closes corporate tax loopholes that don’t help create jobs, and frees up resources for the things that do help us grow - like education and infrastructure and research," he said.

Obama has offered to trim spending for pensions and health care assistance for older Americans in exchange for increasing taxes on wealthy Americans. But Republicans remain opposed to another tax increase after reluctantly agreeing last year to boost taxes on families earning more than $400,000 a year.

Economist O'Sullivan said he did not think the Democratic and Republican lawmakers would agree to change the popular pension and health care programs for seniors.

"Democrats are not going to agree to any meaningful cuts in entitlement spending over time, unless Republicans agree to increase revenues. And I doubt very much that Republicans are going to agree to increase revenues any further," he said.  

The threat of another government shutdown in January looms over the budget talks if the negotiations break down. A leader of the just-ended funding debate, Republican Senator Ted Cruz of Texas, has not ruled out another government closure as he continues to fight the start of Obama's health care reforms.

But the Senate Republican leader, Mitch McConnell of Kentucky, says the shutdown was a losing strategy to fight the Obamacare law and that it is pointless to have another closure.

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