Seeking to corner GOP, White House offers $20B more in spending cuts

Tensions between Senate Democrats and House Republicans over an impending government shutdown rose Monday as the White House worked to finalize a new offer on spending cuts.

The proposal being put together under the direction of White House Chief of Staff Bill Daley would cut an additional $20 billion from this year’s spending on top of the $10 billion already cut by two short-term continuing resolutions, sources close to the talks said.

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The strategy embraced by the White House and Senate Democrats appears designed to convince the public that Democrats are the ones being reasonable. It is intended to show the White House is meeting the GOP halfway, and that it is the new Republican House majority that is unwilling to negotiate. 

In proposing $20 billion in additional cuts, the White House is coming close to the $35 billion in cuts initially offered by House Republican leaders. GOP leaders raised their offer to $61 billion after an uproar in their conference from conservatives, who found the $35 billion offer piddling. 

The White House moves are meant to ensure that Republicans get the blame if an impasse leads to a government shutdown. If the two sides cannot reach a deal on at least another short-term funding measure, the government would shut down after April 8. 

In comments on the Senate floor on Monday, Senate Majority Leader Harry Reid (D-Nev.) emphasized that Democrats have been willing to compromise.

 “We recognize that sacrifices are the cost of consensus, and we believe they’re worth it,” he said.

Sen. Tom Harkin (D-Iowa) echoed Reid’s comments.  

“What is evident is that the Republicans in the House cannot get their act together,” he said in an interview. “They seem to be getting close to making a deal, and then they go back and check with the Tea Party vigilantes in the House and they say no, and that breaks down.”

In response to Reid’s comments, Republican leaders said it was Democrats who would take the fall for a shutdown. 

“In the scope of our debt crisis, if Sen. Reid and Sen. [Charles] Schumer [D-N.Y.] force the government to partially shut down over [the GOP’s] sensible spending cuts, Americans will hold them accountable,” House Majority Leader Eric Cantor (R-Va.) said in a statement.

Cantor charged that Senate Democrats’ inability to draft a serious spending plan is the reason the two sides have not reached a deal. 

Yet in a sign of the pressure faced by Cantor and other GOP leaders, Tea Party Patriots founder Mark Meckler said his organization would oppose any step down from the $61 billion in cuts House Republicans are now proposing. 

Meckler also said the Tea Party is against agreeing to remove language from the bill already approved by the House that would de-fund the healthcare law. 

Meckler said Reid was out of touch with voters, and that the government “might” need to be shut down in order to bring Democrats to their senses.

It is unclear where the additional $20 billion in cuts would be made in the new Democratic offer, though it appears that some would come from mandatory spending, such as cuts to farm subsidies.

Senate Democrats last week put an $11 billion package of cuts on the table that included $7.5 billion in discretionary spending cuts and $3.5 billion in savings to mandatory programs, aides said.

The GOP has balked at having mandatory cuts count toward the $61 billion in cuts it is demanding. Republicans argue the GOP’s “Pledge to America” during the 2010 campaign promised to bring discretionary spending to 2008 levels. Cuts to farm subsidies and other mandatory spending do not help them achieve that goal. 

“Using gimmicks like using mandatory spending instead of discretionary spending is not a world we want to play in,” a GOP aide said.

Harkin, however, said that the agreement has to include mandatory cuts, and that he could identify a $5 billion cut to direct farm subsidy payments immediately. 

House Speaker John Boehner’s (R-Ohio) office said it had not seen the new $20 billion proposal, and a spokesman for Boehner said Reid was trying to create a diversion over Democratic divisions on spending. Boehner spokesman Michael Steel also said discussions would continue.

A House GOP leadership aide said any deal between the parties must cover not only the level of cuts, but some of the policy riders included in the House GOP bill funding the government for the rest of the year. These riders include provisions to defund Planned Parenthood, the new healthcare law and the EPA’s ability to regulate greenhouse gases.

 Over last week’s recess, House Republicans have been faced with pressure from conservative supporters to stand for nothing less than $61 billion in cuts, a GOP aide said Monday. 

“We’ve taken some heat this week and, assuming [others] have as well, I don’t see how $20 billion makes the mark unless it comes with some super-painful policy riders for the administration,” the aide said.

The two sides are also bickering over how to negotiate a deal. 

The GOP has insisted that Democrats use the House-approved spending measure as a basis for talks, while Democrats want to use this year’s spending levels. 

 Working off the GOP bill would mean Democrats would have to state they object to specific cuts, putting them on the spot. Using the stopgap as a basis for talks means the GOP has to explain why the Democrats’ cuts are not acceptable.