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Bipartisan Budget Deal Clears Congress; House Takes Up GOP’s 2012 Plan

April 14, 2011 at 6:39 PM EST
On Thursday, the House and Senate approved the bipartisan budget compromise to fund the federal government through the end of the fiscal year. The House then turned its attention to the budget for next year, specifically the Republican plan. Congressional correspondent Kwame Holman reports on the latest developments.
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JIM LEHRER: Congress finally finished work today on the budget for the current fiscal year and then turned its attention to the coming year.

NewsHour congressional correspondent Kwame Holman reports.

MAN: The bill is passed and without objection a motion to reconsider is laid upon the table.

KWAME HOLMAN: The vote in the House came six months into the 2011 budget year, and only after last Friday’s late-night compromise prevented a government shutdown.

Speaker John Boehner defended the $38 billion in spending cuts as real progress.

REP. JOHN BOEHNER, R-Ohio, speaker of the House: What this bill does, it stops the bleeding. It halts the spending binge that started us moving — and starts us moving back in right direction. But there are some who claim that the spending cuts in this bill aren’t real, that they’re gimmicks. Well, I just think it’s total nonsense. A cut is a cut.

KWAME HOLMAN: In fact, increased defense spending canceled out some of the cuts, and others were spread over multiple years. So, the nonpartisan Congressional Budget Office estimated the reduction for the current year works out to just more than $350 million.

That drew fire from some Republicans who demanded deeper cuts to begin with, and 59 of them voted no. In the end, Republican votes alone would have been insufficient to pass the bill, requiring help from 81 Democrats.

Minority Whip Steny Hoyer summed up the decision they faced.

REP. STENY HOYER, D-Md., House minority whip: And we have a choice to make. We have a choice to make in a divided House, in a divided Congress and divided government. The speaker talked about divided government. And that choice is whether we will come together, work together, try to make best possible agreement that we can make and then move together. I think the American public expects us to do that.

KWAME HOLMAN: The bill was passed by the Senate late this afternoon.

The vote funding the government for this year is only the first skirmish over federal spending. The House today also took up the Republicans’ budget proposal for 2012. It calls for deep spending cuts and tax breaks. But in his speech yesterday, President Obama said the burden should be shared equally, a notion he reiterated today.

The president met at the White House with his deficit commission co-chairs, Republican Alan Simpson and Democrat Erskine Bowles.

PRESIDENT BARACK OBAMA: It’s important that we look at our tax code and find a way to work together to not only simplify and make the tax system fairer, but also that we use it as a tool to help us achieve our deficit targets. And it’s also important, and I think these gentlemen share the view, that we can’t exempt anybody from these efforts.

KWAME HOLMAN: On the Senate floor, Minority Leader Mitch McConnell warned again that Republicans are not about to accept tax hikes.

SEN. MITCH MCCONNELL, R-Ky., minority leader: Americans know that we face a fiscal crisis, not because we tax too little, but because we spend too much. They do not support the reckless Washington spending that has left us with record deficits and debt, and they will not support raising taxes to preserve an unsustainable status quo.

KWAME HOLMAN: The tax divide is just one of the key differences between the two sides.

On the overall deficit, House Republicans plan $4.4 trillion in reductions over 10 years. The president proposes reducing deficits by $4 trillion over 12 years.

On entitlements, House Republicans project savings transforming Medicaid into block grants to the states and revamping Medicare into a voucher-like program. The president says Medicaid can save billions by becoming more flexible and efficient, and he wants to pare Medicare spending by reducing excessive outlays on drugs, among other things.

The House votes tomorrow on the Republican budget.