The Free Press, Mankato, MN

State, national news

October 17, 2013

Grand bargain on the budget is unlikely in the short term

But for the first time since 2009, the committee leaders from each chamber will begin negotiations to reconcile the two budgets.

WASHINGTON — Prospects for a longer-term budget deal in Congress that eases some of the pain from steep spending cuts are good. Prospects for a grand bargain that gets America’s fiscal house in order are another story.

Given how far apart the two parties are, the budget bills already passed by the Senate and the House have little chance of passage in the other chamber as written. But for the first time since 2009, the committee leaders from each chamber will begin negotiations to reconcile the two budgets. They face a December deadline to frame an agreement, and a Jan. 15 deadline to pass legislation before parts of the government run out of money again.

There, too, there’s little hope for a compromise budget to be agreed on in eight weeks. But there’s optimism that the two sides at least may come up with a smarter version of the austerity that’s already in effect.

The across-the-board federal spending cuts made earlier this year, known as the budget sequester, are hitting key constituents of for both parties: defense contractors and suppliers. Experts think that’s likely to drive some sort of compromise.

“We really don’t have time at this point to do anything like the grand bargain that people are talking about,” said Joe Minarik, the director of research for the Committee for Economic Development, a free-market research center. “It’s not realistic to think that there is going to be any kind of major progress on the big budget problems between now and then.”

Minarik, a former chief economist for the House Budget Committee, noted that big legislative achievements, such as revamping the tax code or changing the funding structure for Social Security, took years of negotiation. Even modest tweaks such as changing how cost-of-living adjustments are determined for Social Security benefits are likely to remain too heavy a lift for the new budget negotiations.

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