11th Hour Deal: Government Shutdown Averted
Policy + Politics

11th Hour Deal: Government Shutdown Averted

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The White House and House GOP leaders reached a tentative agreement late Friday on a budget deal that would cut nearly $40 billion from current spending only hours before a threatened government shutdown.

Speaker John Boehner, R-Ohio, announced shortly before 11 p.m. that he had reached agreement with President Obama and Senate Majority Leader Harry Reid, D-Nev., after presenting details of the plan to House Republican members in the basement of the U.S. Capitol.  Boehner told his GOP colleagues that “this was the best deal we could get out of them,” according to Politico.

President Obama and Reid confirmed that an agreement had been reached. “This agreement between Democrats and Republicans on behalf of all Americans is on a budget that invests in our future while making the largest annual spending cuts in our history,” Obama said.

“Like any worthwhile compromise, both sides had to make tough decisions and give ground on issues that were important to them, and I certainly did that. But beginning to live within our means is the only way to protect those investments that will help America compete for new jobs, investments in our kids’ education and student loans, clean energy and life saving medical research.”

Boehner didn’t divulge the details of the budget agreement, but according to media reports the two sides agreed to $39 billion of cuts from a trillion-dollar domestic spending measure for the remainder of the current fiscal year.  The deal includes a seventh and final stop-gap spending measure that will keep the government operating through the middle of next week, while the two sides work out the final details of the spending authority for the remaining six months of fiscal 2011. The House was scheduled to vote on the measure and send it on to the Senate for approval before the midnight deadline.

“I’m pleased that Sen. Reid and I and the White House have been able to come to agreement that will in fact cut spending and keep our government open,” Boehner told reporters. “I would expect the final vote on this to occur next week.”

Washington heaved a collective sigh of relief following the announcement. For much of the day, a shutdown  that would result in furloughing 800,000 federal workers and potentially undercut the economic  recovery seemed all but certain as Democratic and Republican lawmakers sparred over spending levels and social policy issues. High level talks at the White House involving President Obama, Boehner and Senate Majority Leader Harry Reid, D-Nev., that  had appeared on track abruptly stalled over GOP insistence on eliminating preventative care and family planning funding for Planned Parenthood, the nation’s largest abortion provider.

The Republicans eventually abandoned their demand in the face of daylong women’s right protests and speeches at the Capitol, while apparently extracting additional spending cuts in the final round of talks.  The Republicans at one point demanded $67 billion in cuts from domestic spending programs for the remaining six months of fiscal 2011. Late Thursday night, the two sides tentatively signed off on $35 billion of savings, but Boehner backed away from the deal before dawn on Friday, and changed the tenor of the talks by demanding elimination of Planned Parenthood funding.

Throughout Friday, the Capitol was the scene of a bizarre political drama, as Boehner and Reid offered wildly conflicting accounts of the status of the budget talks. Boehner and other GOP leaders blamed the Democrats for refusing to accept spending cuts large enough to satisfy Americans worried about runaway spending and a $1.5 trillion deficit. But Reid chided Boehner for reneging on the Thursday night tentative deal under pressure from the Tea Party and hard line conservatives. “The debate has nothing to do with a [spending cut number; it has everything to do with women’s health,” Reid told reporters.

The deadlock over literally a sliver of the federal budget threatened to trigger a disruptive and costly government shutdown, with adverse impact on furloughed workers and their families,  government contractors, millions of Americans dependent on federal services,  members of the armed services and their families, tourists and scores of  communities with major federal enclaves.   For a country just now clawing its way out of the worst recession in modern times, the furloughing of hundreds of thousands of federal workers and the temporary shuttering of federal agencies that handle everything from home mortgage applications to small business loans couldn’t come at a worse time.

The two sides raced against a midnight deadline to craft a deal – or agree to a seventh, final short-term spending measure to keep the government afloat until a final deal is reached in the coming days.   Obama and Senate Democrats opposed a House-passed continuing resolution which would keep the government operating for another week and fully fund the Pentagon through Sept. 30, but contained unacceptable policy amendments, including the elimination of Planned Parenthood funding. 

The Republicans wanted to change the way the government hands out money to programs like Planned Parenthood which provide abortions as well as other health services. These organizations are barred from using federal funds to pay for abortions.

Thousands of Planned Parenthood supporters rallied at the Capitol on Friday. Reid, Sen. Patty Murray, D-Wash., and other Democrats vowed to make a stand to protect funding for health services, birth control and preventative care for women against Sen. Mike Pence, R-Ind., and a raft of conservative lawmakers and Tea Party activists adamantly opposed to anything they believe would facilitate abortions. “This is indefensible,” Reid said on the floor of the Senate.

Cecile Richards, president of the Planned Parenthood Federation of America, said “I think it’s really important that the American people know there are no federal funds that pay for abortion either at Planned Parenthood or any hospital in America. And 97 percent of Planned Parenthood services are basic preventative care, family planning, pap smears, and breast exams.”

Richard K. Armey, president of Freedom Works, a conservative grass-roots organization closely allied with the Tea Party, acknowledged that Tea Party activists are pressing hard against funding for Planned Parenthood and said the Democrats have no one to blame but themselves for not passing the budget late last year when they still controlled the House as well as the Senate.

“The fact of the matter is that for over 30 years, there never has been a polling result that was supportive of federal funding of abortion that I’ve ever seen,” Armey, a former Republican House Majority Leader, said in an interview with The Fiscal Times. “The American people are overwhelmingly opposed to spending federal funds on abortion.

Armey said that Tea Party activists are “being vigilant” but disputed Democrats’ claims that they put inordinate pressure on Boehner to stand fast on Planned Parenthood funding. “I understand the constraints he’s working under,” Armey said. “He can only push it as far as his moderates will go.” He added that Boehner “is doing a better job” than he and former House Speaker Newt Gingrich, R-Ga., did during the Republican Revolution of the late 1990s.

In his statement Friday night, Obama said of the final round of the negotiations, “We also made sure that at the end of the day this was a debate about spending cuts, not social issues like women’s health and the protection of our air and water. These are important issues that deserve discussion, just not during a debate about our budget.”

Adam Corey Ross and Jennifer DePaul of the Fiscal Times contributed to this report.

Related Links: 
Republicans Urging Boehner to Cut Deal (National Journal)
Government Shutdown Averted as Last Minute Deal is Reached (CBS News)