Senate sets up budget battle

Tax reform eyed as lawmakers pass first fiscal plan since 2009

AFP-JIJI, AP

The U.S. Senate reached a milestone Saturday when it overcame partisan gridlock to approve its first budget resolution in four years, setting up a political duel with the Republican-held House of Representatives.

The sweeping plan for the 2014 fiscal year, the first budget blueprint passed by the Democrat-led Senate under President Barack Obama since 2009, squeaked through by the narrowest of margins, 50-49.

“Doing this has been a Herculean feat,” said Democratic Majority Leader Harry Reid, referring to the 100 amendments that were voted on in a marathon 13-hour session known in the Senate as a “vote-a-rama.”

The plan, shepherded by Senate Budget Committee chairwoman Patty Murray, seeks nearly $1 trillion in new revenue over the next decade, mostly through the closure of tax loopholes that favor the wealthy and an equal amount in reductions to government spending.

The House on Thursday adopted its own budget resolution, which seeks to reach balance within 10 years through significant reductions in federal spending, the overhaul of entitlements such as Medicare and the repeal of Obama’s health care law.

The glaring partisanship of Congress ensures that neither plan will be enacted into law. Instead, they will serve as the starting points for a broader debate this year over budget policy.

The Senate’s budget would shrink annual federal shortfalls over the next decade to nearly $400 billion, raise unspecified taxes by $975 billion and cull modest savings from domestic programs. The House’s plan would balance the budget within 10 years without boosting taxes.

That blueprint— by Paul Ryan, the Republican party’s vice presidential candidate last year — claims $4 trillion more in savings over the period than Senate Democrats by digging deeply into health care and food benefits for the poor and other safety net programs. It would also transform the health care program for older Americans into a voucherlike system for future recipients.

Republican Minority Leader Mitch McConnell praised the comprehensive debate on the floor that allowed lawmakers to eventually reach their objective of voting on a fiscal blueprint. “This is one of the Senate’s finest days in recent years,” he said.

Leaders in the Senate and House are now expected to bring the chambers to conference as lawmakers head into what increasingly looks like becoming a summer showdown over the U.S. federal borrowing limit. House Speaker John Boehner has said he wants a dollar in spending cuts for every dollar rise in the debt ceiling, but Obama opposes such an approach.

Obama has courted Republicans in recent weeks in a bid to draw mutually acceptable outlines for deficit reduction. The president wants new revenue as part of a deal, but Boehner has stressed that the $600 billion in tax hikes from a yearend pact were the last new taxes he wanted to see.

Senators worked feverishly through the entire day Friday and into Saturday as the parties’ leaders contended with more than 560 filed amendments. Most fell by the wayside and were not voted on, but there were key amendments that were approved, including a repeal of an unpopular tax on medical devices that was enacted as part of “Obamacare.”

Symbolic amendments ranged from voicing support for letting states collect taxes on Internet sales to expressing opposition to requiring photo identification for voters.

Senators also went on record in support of the Keystone Pipeline, which the Obama administration has delayed due to environment concerns, and backed the withholding of wages for top White House budget staffer for every day the president fails to disclose his budget plan.

Obama was supposed to lay out his budget in February, but the White House now says he will do so in April.