The Deal Is Not A Good One - But It Should Be Passed By Congress

 I have to admit that I'm a bit surprised. I didn't think there was any way an agreement could be reached on the federal budget by the conference committee -- but they cam up with one. The deal restores some of the funding cut by the awful sequester agreement, but not nearly enough to help the economy very much.

The House had wanted to set spending for this year at $967 billion, while the Senate wanted it set at $1.058 trillion. The committee split the difference, and set it at $1.012 trillion -- restoring a few billion dollars to the budget over the next two years.

The good news is that there were no new cuts to Social Security or Medicare (although cuts already made to Medicare were extended a couple of years), and there will now not be a government shutdown looming over the budget (since this agreement covers both this year and next year). There was also a tiny bit of new revenue (through higher fees for airlines and for companies that use the federal pension guarantee program).

The bad news is that there was no new funding agreed to for extended unemployment benefits (so millions will soon be added to poverty roles as their benefits run out and there are no new jobs for them), there was no debt ceiling deal included (which could mean a shutdown threat over that next summer), veterans got their COLA decreased, and half of the new funding will go to the already bloated military budget.

All things considered, this was not a good deal for the American people. But it was probably the best deal that could be reached, and for that reason, it should be passed by Congress.

Democrats will most likely support the agreement and vote for it, in spite of the fact that most of them don't like it. Whether the  agreement can be passed will depend on the House GOP. There are already right-wingers whining about the agreement, and it is entirely possible that more House Democrats will vote for the agreement than House Republicans (even though the GOP leadership is trying to drum up support for it).

The country and the economy needed a better agreement -- one that would spur the economy, tax the rich and corporations a bit more, and create new jobs. But as long as the Republicans control the House, that is not going to happen. We need to take care of that in November 2014.

(The caricatures of the House and Senate committee chairs, Patty Murray and Paul Ryan, are by DonkeyHotey.)

House-Senate Budget Committee Set To Fail

Reconciliation of the budget bills from the House and Senate never had much of a chance of succeeding, and now it looks like it is going south in a hurry. They've only met a couple of times, and they still have a month before they are required to report back to the full House and Senate, but both sides are already digging in.

House committee leader Paul Ryan has made it clear that the Republicans won't even discuss new revenue of any kind. And Senate committee leader Patty Murray has made it equally clear that there will be no new cuts, or any "grand bargain", without closing tax loopholes that allow the rich to pay less in tax percentage than many in the middle class.

It's obvious that Senator Murray is the one willing to compromise here. She has not ruled out any cuts, and is willing to discuss a compromise. She, and her fellow Democrats on the committee, just want any budget resolution to be fair to everyone. They are not willing to lower the deficit on the backs of hurting Americans (children, seniors, the poor, the unemployed, etc.) and let the rich (and corporations) continue to avoid paying taxes. They want any agreement to contain a mixture of cuts and new revenues.

Meanwhile, the Republicans maintain their "don't tax the rich" attitude. They cling to their failed trickle-down economic policy. And they want to reduce the deficit with just cuts -- cuts that will further hurt ordinary Americans who are still struggling to recover from the Bush recession.

None of this should surprise anyone. This budget reconciliation committee had only about as good a chance of succeeding as the public approval of Congress -- about a 6% to 9% chance of success. There is still a month before the committee has to report back to Congress, but unless the Republicans change their "no compromise" attitude, they will just be reporting their own failure. This means we will be looking at a new continuing budget resolution next January -- and the possibility that the GOP will shut down the government again.

I wish I was wrong on this, but a person would have to be the world's greatest optimist to think this committee will find a budget they can agree on (and could pass in both the House and Senate). I just hope the Democrats stick to their promise. No budget agreement would be better than another GOP-imposed round of cuts with no increased revenues.

(The caricatures above of Patty Murray and Paul Ryan are by DonkeyHotey.)