The Budget Deal Passed: Here's What Remains Unresolved

The good news: The bill should prevent another shutdown. The bad news is it doesn't grapple with the largest, most difficult spending questions.
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Paul Ryan and Patty Murray part ways after a news conference to announce their budget deal. (Jonathan Ernst/Reuters)

The Senate passed the Bipartisan Budget Act 64-36 on Wednesday, ending months of acrimony on Capitol Hill and ensuring that the New Year will ring in with far less chance of a government shutdown.

The measure, which has drawn grumbling from lawmakers in both parties but is also widely hailed as a breakthrough compromise, passed with nine Republicans joining Democrats to approve it. The bill now heads to President Obama's desk and he has promised to sign it.

The measure represents a modest deal brokered by Senator Patty Murray and Representative Paul Ryan that sets top-line spending figures for the remainder of Fiscal Year 2014 and Fiscal Year 2015, ending the uncertainty that lead to last October's government shutdown securing government funding until at least October of 2015. It does not change entitlement spending, close tax loopholes or address the debt ceiling.

The deal also does not raise taxes, but includes a number of new and increased user fees and other revenues to compensate for the sequester relief funds. Several of the revenue provisions, including cuts to retired veterans' pensions and increased airline fees, were criticized by lawmakers but the uproar proved insufficient to derail the bill.

Congressional appropriators can now formally begin the task of funding the federal government for the remainder of the fiscal year. Senate Appropriations Committee Chairwoman Barbara Mikulski and her House counterpart, Representative Harold Rogers, and their subcommittee chairs have already begun discussions and will be working through the holidays to form a 12-bill omnibus package that Congress will address when they return in January. The current funding mechanism, a continuing resolution passed at the end of the October shutdown, expires January 15.

The budget bill passed Wednesday funds the government at $1.012 trillion for the remainder of this fiscal year and provides $63 billion in sequester relief, split evenly between defense and non-defense programs, over the next two years. By extending sequestration for two more years—the cuts will now run through 2023—the plan reduces the deficit by $28 billion over the next 10 years.

Drawing a contrast with their House counterparts, Senate Republicans opposed the deal in part because it busted the budget caps set by the 2011 Budget Control Act. Minority Leader Mitch McConnell said he felt a "pride of authorship" regarding the BCA and couldn't support a deal that exceeded those limits.

Others, including Republican Senators Roger Wicker of Mississippi, Lindsey Graham of South Carolina, and Kelly Ayotte of New Hampshire, objected to the part of the legislation that makes cuts to military pensions. Minority Whip John Cornyn of Texas laid the blame for the pension cuts at the feet of Majority Leader Harry Reid because he filled the so-called amendment tree, blocking members from offering changes to the budget deal.

"The Senate's broken," he said. "The fact that this discriminatory cut in pensions for active duty military can't be fixed because Senator Reid won't allow any amendments to something that would enjoy broad bipartisan support says a lot about how broken the Senate is."

Despite those concerns, several lawmakers are planning to push legislation to restore those cuts sometime next year.

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Sarah Mimms & Michael Catalini

Sarah Mimms and Michael Catalini are reporters at National Journal.

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