Senate passes budget deal, looks ahead to fight over debt limit

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WASHINGTON -- Congress declared a holiday truce in the budget wars Wednesday, sending President Barack Obama a blueprint for funding the government through 2015. But the next skirmish was already on the horizon: an election-year fight over the national debt.

The budget deal that passed the Senate on Wednesday amounts to a handshake agreement to avoid a government shutdown when a temporary funding measure expires Jan. 15. However, the accord does not address the need once again to raise the debt limit, setting up a potentially complicated confrontation in late February or early March.

That fight would come just months before midterm congressional elections, and Republicans are deeply divided over tactics to deal with the debt, a core issue for their party's base. Some conservatives are calling for another showdown, insisting on an additional round of spending cuts in exchange for granting the Treasury Department more borrowing authority to pay the nation's bills.

But Republican leaders, especially in the House, have no appetite for another Washington fiscal crisis that could destroy their popularity among voters, aides said. Instead, they are hoping for a more peaceful resolution modeled on the latest budget deal -- a bipartisan compromise that solves small problems and aims to offend almost no one.

"Republicans kind of look at this election as probably the best opportunity we've ever had at taking control" of the Senate, said Sen. James Inhofe, R-Okla. As a political message, threatening to default on the debt "hasn't really worked all that successfully in the past," he said.

As they rushed to finish work and leave town for a three-week Christmas break, senators were more inclined to bask in the budget deal's glow than to plot strategy for the debt limit. The agreement draws to a close nearly three years of fighting over agency budgets -- battles that repeatedly risked shutting down the government and actually did close parks, museums and federal offices for 16 days in October.

Congressional leaders appointed Senate Budget Committee chairwoman Patty Murray, D-Wash., and House Budget Committee chairman Paul Ryan, R-Wis., to negotiate a cease-fire. The resulting agreement would roll back sharp spending cuts known as the sequester over the next two years, sparing the Pentagon from more reductions and restoring billions of dollars for domestic programs.

The $62 billion cost would be more than covered by $85 billion in alternative policies, such as higher security fees for airline passengers, deeper cuts for Medicare providers and less generous retirement benefits for federal workers, including military retirees younger than 62.

The deal makes no effort to solve the nation's biggest budget problem: a social safety net strained by an aging population. But it also would not raise taxes or reduce Medicare benefits, leaving each party's core ideological commitments intact.

Last week, the deal sailed through the House and, on Wednesday, it easily passed the Senate, 64 to 33. Nine Republicans joined all 55 Senate Democratic caucus members in voting yes. Ms. Murray stood in the well of the chamber as the vote unfolded, accepting pats on the back from colleagues in both parties.

"The American people are sick and tired of the constant crises we've seen here in D.C. over the past few years," Ms. Murray said on the floor. "I am hopeful this deal can be a foundation for continued bipartisan work, because we have so many big challenges we need to tackle for the families and communities we represent."

Afterward, senators voted overwhelmingly to end debate on a defense bill that sets Pentagon policy and military pay levels. A final vote to approve the National Defense Authorization Act was set for today, with hopes rising that the chamber also would approve several pending nominations and head home Friday.

Meanwhile, leaders of the congressional spending committees immediately began working on 2014 appropriations -- the first in two years -- to distribute about $45 billion in extra cash to federal agencies. Senate Appropriations Committee chairwoman Barbara Mikulski, D-Md., was optimistic that she and her House counterpart, Rep. Hal Rogers, R-Ky., could work through some minor disagreements and deliver an omnibus spending bill to Mr. Obama's desk by Jan. 15.

Once that deadline is cleared, attention will turn to the national debt, which stands at $17.2 trillion. Enforcement of the debt limit has been suspended until Feb. 7, when Treasury Secretary Jacob Lew has said he'll have about a month until he runs short of cash to pay the nation's bills.


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