Budget

Senate Majority Leader Harry Reid (D-Nev.) said Tuesday Democrats have reached the end of their rope on discretionary spending cuts as the clock ticks closer to a government shutdown. 

Sen. Jeff Sessions (R-Ala.), the ranking member of the Senate Budget Committee, touted the House GOP’s 2012 budget proposal on Tuesday, calling it a “serious” plan in deep contrast with President Obama “irresponsible” one. 

The House budget – crafted by Rep. Paul Ryan (R-Wis.) – has come under deep criticism from key Senate Democrats, but Sessions said at a Tuesday briefing that the House Budget  Committee chairman’s work is  “the most responsible, honest, long-term, tough, realistic budget we have probably ever seen since I've been in the Senate.” 

“This is serious business they've done,” he added. “This is not gimmicks. They've honestly dealt with the most fundamental financial issues we have.” 

The former chairmen of the president’s debt commission offered a mix of praise and criticism for the 2012 budget resolution put out Tuesday by House Budget Committee Chairman Paul Ryan (R-Wis.).

Erskine Bowles and former Sen. Alan Simpson (R-Wyo.) praised Ryan for making serious deficit-reduction proposals but also took issue with the depth of some cuts and for his unwillingness to include defense cuts and tax increases.

The Senate Budget Committee in a strictly party-line vote on Tuesday gave its consent to President Obama's pick to be the deputy director of the Office of Management and Budget. Ten Republican members voted against Heather Higginbottom's nomination, while 11 Democrats voted in favor.

Ranking member Jeff Sessions (R-Ala.) blasted Higginbottom during her confirmation hearing last month, arguing that she is not qualified for the job of overseeing the federal budget. He also used the occasion to criticize Obama Budget Director Jack Lew for what he said were distorted representations of Obama's 2012 budget request.

“I am pleased the Budget Committee voted today to confirm Heather Higginbottom as the Deputy Director of the Office of Management and Budget. Ms. Higginbottom’s service in the White House and the Senate has given her a broad knowledge of federal policy and the operations of the government. She was also personally selected by Director Lew as the person he wants as his deputy. Director Lew needs and deserves to have the Deputy Director of his choice working with him at OMB," committee Chairman Kent Conrad (D-N.D.) said in a statement. 

House Agriculture Committee Chairman Frank Lucas (R-Okla.) said Tuesday that Rep. Paul Ryan's (R-Wis.) budget proposal offers "simply suggestions" on what to include the next farm bill, making clear his committee will have final say on what that legislation looks like.

Lucas offered kind words for Ryan's newly unveiled proposal, calling it the "first serious step in reining in our deficit," but noted in his statement that he "might not agree with every proposed cut."

He added that the farm bill falls under his committee's jurisdiction, and its members will ultimately decide what's in the legislation.

Ryan: Fact that his plan wouldn't balance the budget "just shows you how deep a hole our country is in."

Cantor speaks while Speaker John Boehner attends a meeting with President Obama on spending.

Rep. Paul Ryan (R-Wis.) makes the case for the GOP budget.

The Obama administration continues to prep for a government shutdown, while working to avoid it.

China's central bank hiked interest rates for the fourth time in six months.

Federal Reserve Chairman Ben Bernanke continued to downplay the risk of inflation in a speech Monday night.

The Fed made emergency loans during the financial crisis to over 100 banks that ultimately failed.

About four out of five IRS audits are now done by mail.

TUESDAY’S BIG STORY:

The budgets for 2011 and 2012 will be forced to share center stage on Tuesday.

Come morning, Rep. Paul Ryan (R-Wis.), the chairman of the House Budget Committee, is set to unveil his chamber's GOP’s budget resolution for the next fiscal year. 

Some leaks and the chairman’s own statements have told us that the 2012 GOP plan will propose block-granting Medicaid and changing Medicare from a defined benefit program to a defined contribution toward private insurance. The plan is also expected to cap overall spending as a percentage of the economy and cut deficits by between $4 trillion and $6 trillion over 10 years, without increasing taxes.

At high noon, Ryan plans to try and lay out all of this to an audience at the American Enterprise Institute.

While a growing number of those asked in a recent poll would fault Republicans for a government shutdown, there's still plenty of blame to go around as most respondents support lawmakers reaching a compromise even if they don't like it.

In a poll released Monday, 39 percent say Republicans would be more to blame if the GOP and Democrats can't reach an agreement by the end of the week on a federal budget plan that would get the government through the rest of the fiscal year, which ends Sept. 30.  

Right behind Republicans is the Obama administration -- 36 percent say they would be at fault while 16 percent would blame both sides, according to a poll released Monday by Pew Research Center for People and the Press.