Shutdown isn’t fight GOP wants

Republicans have decided that the sequester scheduled for March 1 — not a government-funding bill due at the end of March — is where they’ll make their stand on spending cuts.

After the bruising political battles of the last Congress, GOP leaders have decided the looming automatic spending cuts provide the best leverage to move President Obama to negotiate on costly entitlement programs.

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“Republicans are not going to take a stand on a government shutdown. We’re not going to take a stand on the debt ceiling. We’re going to take a stand on the sequester,” said a Republican senator, who requested anonymity to discuss his party’s strategy.

“The sequester affects programs President Obama likes and we think it’s the best chance of getting his attention on spending,” the lawmaker added.

GOP leaders see the spending sequester as the political inverse of the fiscal cliff. Republicans felt they had little choice, at the end of 2012, but to agree to tax increases because if they did not compromise, all of the Bush-era tax rates would have expired.

Republican aides say the onus is now on Obama and the Democrats to give ground because if there is no deal, federal programs will see an $85 billion reduction between March 1 and the fiscal year’s end. 

While Republicans want to avoid cuts to military spending, they believe Democrats are more eager to spare social programs from across-the-board reductions. 

A Senate GOP aide said Republicans will take the sequester before agreeing to any tax increases to offset the cost of stopping it.

“Is it designed the way you’d like it to be designed? No. Is it a guaranteed reduction of spending? It is, and we’ll take that,” said the aide. 

A few Senate Republicans say they are willing to consider tax increases to pay for a package to stop sequestration from hitting. 

But even the most centrist members of the Republican Conference say the package introduced by Senate Majority Leader Harry Reid (D-Nev.) last week is tilted too heavily toward tax increases.

“I would not support increases in income tax rates because we’ve already settled that issue. It sounds like it’s weighted way too heavily on the tax side given what we’ve already done,” said Sen. Susan Collins (R-Maine).

Collins said she would support eliminating tax subsidies for major oil-and-gas companies. 

But Reid left that proposal out in part because of opposition from Sens. Mary Landrieu (D-La.) and Mark Begich (D-Alaska), who represent oil-rich states and face reelection next year.

The Senate Democratic package would raise about $55 billion in new tax revenues and cut $55 billion in spending to stop the sequester through the end of the calendar year.

“Half? I don’t think it gets there. You’re just not going to have the [needed] level of support,” said Sen. Lisa Murkowski (R-Alaska).

Sen. John McCain (R-Ariz.) said on Fox News earlier this month that he might consider ending some tax breaks to stop defense cuts.

But altogether, a senior GOP aide said, the total number of Senate Republicans willing to support tax increases to pay for the sequester “is probably a population under five.”

Several other Republican lawmakers, such as Sen. Lindsey Graham (R-S.C.), who have expressed support for raising additional tax revenues, insist it should be done in the context of a broad deal to reform entitlement programs.

Conservative activists warn GOP leaders will face a backlash if they agree to stop the sequester in a deal that raises taxes or relies on a budget gimmick to mask its impact on the deficit.

“I think the grassroots will be greatly dismayed by Republicans kicking the can down the road again and will fight hard to prevent that from happening. These cuts are modest trims to projected future spending growth,” said Dean Clancy, vice president of public policy at FreedomWorks, a conservative advocacy group.

A Senate GOP aide said that conservative House Republicans would be willing to accept a stopgap measure funding the government through the end of the fiscal year if the sequester were to take effect as scheduled.

“The sequester might be the best medicine for preventing a government shutdown,” said the aide.

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House Appropriations Committee Chairman Hal Rogers (R-Ky.) is working on a $1.043 trillion continuing resolution for the rest of the fiscal year. The sequester would chop $85 billion from the fiscal-year budget, bringing it roughly in line with the $974 billion level Speaker John Boehner (R-Ohio) has promised to conservatives.

A spokesman for the conservative Republican Study Committee did not respond to a request for comment.

Boehner told The Wall Street Journal in an interview last month that the sequester would give Republicans a stronger card to play against Obama in negotiations on entitlement program spending, a major driver of the federal deficit.

Boehner said the suspension of the debt limit, which is set to expire on May 19, is “one point of leverage” but “not the ultimate leverage.”

Obama has insisted he will not negotiate spending cuts or entitlement reforms in exchange for raising the debt limit. So far, Republicans have shown little appetite for the nasty political fight that political analysts believe hurt them in the summer of 2011.

Obama delivered remarks Tuesday setting the GOP up for blame if the sequester takes effect, saying that “if Congress allows this meat cleaver approach to take place, it will jeopardize our military readiness.”

A Senate Democratic aide noted it would cut 5 percent in non-discretionary programs because many mandatory programs would be exempt. 

Discretionary defense programs would see a 7.3 percent cut.

Republican aides argue the sequester would only trim about 2.4 percent from the total federal budget and that its impact on defense programs could be easily mitigated by shifting cuts to other areas.

“Finding modest savings in the dozens of exempt programs should be easily doable,” said a GOP aide.