Stocks suffer worst week in two years
Republicans pass a budget, flexing power of majority
Congressional Republicans scored a major legislative victory on Tuesday as the Senate adopted the first bicameral GOP budget agreement in a decade.
The 51-48 vote capped weeks of work by Republican leaders in the House and Senate, who shepherded the blueprint through a messy debate over defense spending that at times threatened to split their conferences.
The blueprint passed the House last week, and will not require a signature from President Obama.
Passing a budget, which is always a heavy lift, was particularly important for Senate Republicans, who are seeking to demonstrate their ability to govern in a difficult 2016 election cycle - they are defending 24 seats.
Senate Majority Leader Mitch McConnell had ripped Democrats for years over their failure to pass a budget, and said Tuesday's vote shows his GOP majority is getting the Senate working again.
"No budget will ever be perfect, but this is a budget that sensibly addresses the concerns of many different members. It reflects honest compromise from many different members with many different priorities," the Kentucky Republican said on the Senate floor.
Still, the budget vote split the Senate's GOP presidential hopefuls, with Sens. Ted Cruz (Texas) and Rand Paul (Ky.) voting against the agreement and Sens. Marco Rubio (Fla.) and Lindsey Graham (S.C.) voting in favor.
Democrats, who voted in unison against the budget in both chambers of Congress, said Republicans would come to regret calling for trillions of dollars in cuts to federal spending.
"We know there's only one bit of good news. Our colleagues, when they're forced to actually put real numbers to these budget numbers in the appropriations process, won't be able to do it. They won't dare do it," Sen. Charles Schumer (D-N.Y.) said.
The White House signaled in statement Tuesday evening that the budget has no chance of getting Obama's approval.
"The president has made clear that he will not accept a budget that locks in sequestration going forward, nor one that reverses sequestration for defense - whether explicitly or through backdoor gimmicks - without also reversing sequestration for non-defense," the White House said.
"There is bipartisan support for a commonsense deal," the statement added. "The administration looks forward to working with Congress on an agreement that will allow us to invest in our economy and protect our national security."
The non-binding resolution approved Tuesday sets the top-line numbers that appropriators will use to craft 12 bills funding the government in fiscal 2016. The plan calls for balancing the budget in 10 years by cutting more than $5 trillion from spending.
Setting the stage for a clash this fall, Schumer vowed that Democrats would only support easing the budget cuts under sequestration if the legislation includes dollar-for-dollar increases in both defense and domestic programs.
"Those are bottom lines that unite our caucus, unite our caucus with the president, and there will not be a budget without it," Schumer said.
House Republicans have already begun moving through a handful of fiscal 2016 spending bills that stick to the $1.017 trillion spending ceiling imposed under sequestration. Democrats say the spending levels simply aren't high enough.
"It complicates them immensely because at a certain point, you just run out of resources for functions that I think Republicans deem critical," said Sen. Jack Reed (D-R.I.), ranking member on the Senate Armed Services Committee and an appropriator, on Tuesday.
"We've got to find a way to raise the caps," added Reed, who alluded to the December 2013 deal reached by then-Budget chairs Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wash.), which relieved sequestration for two years.
Sen. Mike Crapo (R-Idaho), a member of the Senate Budget Committee, told The Hill he's not sure whether another deal to ease the spending caps will materialize.
"I think there is an appetite to make some strong progress on the budget through an agreement," he said. "I think it's possible, but I don't know how to put odds on it."
While the GOP budget sticks to the spending caps for both the Defense Department and domestic programs, Republicans are seeking a way around the limits by channeling billions of dollars to a "war fund" that is exempt from sequestration.
Senate Minority Whip Dick Durbin (D-Ill.), an appropriator, said it's "disproportionately unfair" to increase the Pentagon's spending authority without boosting it for other agencies, such as the departments of Homeland Security and Veterans' Affairs.
Asked whether President Obama would veto a defense bill at the Republicans' proposed spending level, Durbin replied: "Counting on it."
The White House has already threatened to veto the GOP's first two appropriations bills, and has implied that the other 10 bills will meet the same fate.
That could leave Congress facing a new government shutdown fight in September, with a deadline of Oct. 1 for passing some kind of legislation to keep the government funded.
A shutdown fight would be risky for both sides, but would be particularly perilous for Republicans as they seek to retain control of Congress and win back the White House. The last shutdown fight sent the GOP's poll numbers to historic lows, though the party's brand recovered ahead of a historic midterm elections triumph.
House Appropriations Committee Chairman Hal Rogers (R-Ky.) has expressed hope for a Ryan-Murray-type agreement on spending this year, and Speaker John Boehner (R-Ohio) has said he's open to a bipartisan agreement.
"If there's a way to reduce mandatory spending in a way that would provide relief to the sequester, like we did with the Ryan-Murray budget plan, have at it," Boehner said.
Sen. Rob Portman (R-Ohio), who is facing a tough reelection race next year, said it remains to be seen whether lawmakers can work together to find spending cuts and savings that can provide sequester relief.
"It'd be nice to get it done soon. But obviously Sept. 30 is the key date."
- Bernie Becker and Jordain Carney contributed.
- Updated at 8:34 p.m.