Paul Ryan, Patty Murray Announce Budget Deal; Sequester Out, Spending Up

"Compromise."

They're announcing it now, live, on FoxNews (and I imagine a lot of other stations).

National Journal laid out the basics:

Budget negotiators were tantalizingly close Tuesday afternoon to reaching a two-year deal that would set annual spending levels around $1 trillion and replace some automatic spending cuts with non-tax revenue, according to aides and lawmakers familiar with the situation. s set to hold a press conference.

...

Even as a deal appears certain, significant hurdles remain to final passage. Some conservatives have recently voiced opposition to swapping out sequester cuts for "user fees," while liberals have criticized any deal that does not extend unemployment insurance or protect federal employees from paying more into their pensions.

As I understand it, the actual cuts of the sequester will be replaced by "future cuts," also known as "not cuts at all," and a host of new or increased taxes which aren't called taxes because they don't want to call them taxes.

Drew discussed the deal yesterday, or at least the hints that had been public as of yesterday.

It became clear months ago when the House only passed appropriation bills that increased spending and not the ones that actually cut spending that the fix was in.

And don't buy the nonsense about fees (aka "taxes") or higher pension contributions offsetting some of the spending. First, like almost all stopgap gimmicks they are...gimmicks. Second, in the case of higher pension contributions, that should happen even with the sequester in place to reduce costs, not to offset new ones.

The biggest problem with the "off-set" flimflam is that even if it helps offset hiking the budget and the debt, it does nothing to shrink the size and scope of government. I've said it before and I still mean it, I'd rather a federal budget that takes up 17-18% of GDP and was out of balanced than a budget that consumes 24% and is balanced. Size and scope of government matter more than perfectly balancing the books.

More Details: At the Washington Post.

Yes, you'll be paying more in "non-tax revenue," or, I call it, Ryan Taxes.

Sequester's out, and Ryan Taxes are in:

Those savings would be replaced by roughly $63 billion in other policies, including fee increases for airline travelers, cuts to federal-worker and military pensions and higher payments for federal insurance of private pensions, according to people familiar with the talks.

Ryan and Murray were rushing to file legislation before midnight so the House could vote as soon as Thursday and leave town for the year by the weekend. The Senate, which is scheduled to leave town next week, would vote thereafter.

The agreement would set the budget for the Pentagon and other federal agencies at $1.012 trillion for fiscal 2014 and $1.015 trillion for fiscal 2015, preventing a new $20 billion hit to defense spending from taking effect in January.

Domestic agencies would get a bump up of equal size, according to people familiar with the deal. The $63 billion pricetag would be covered with a mix of policies, roughly half spending cuts and half new non-tax revenues.

posted by Ace at 06:18 PM

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