Late deal averts government shutdown

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Associated Press

WASHINGTON

Perilously close to a government shutdown, President Barack Obama and congressional leaders forged agreement late Friday on a deal to cut more than $37 billion in federal spending and avert the first closure in 15 years.

Obama hailed the deal as “the biggest annual spending cut in history,” and House Speaker John Boehner said that over the next decade it would cut government spending by $500 billion.

“This is historic, what we’ve done,” said the third man in the talks, Senate Majority Leader Harry Reid, D-Nev.

They announced the agreement less than an hour before government funding was due to run out. Still under the gun, lawmakers raced to pass an interim measure to prevent a shutdown, however brief, and keep the federal machinery running for the next several days.

Earlier in the evening, Boehner indicated his own optimism about a deal, telling reporters, “I was born with a glass half full.”

Reid, Obama and Boehner all agreed a shutdown posed risks to an economy still recovering from the worst recession in decades.

But there were disagreements aplenty among the principal players in an early test of divided government — Obama in the White House, fellow Democrats in control in the Senate and a new, tea party-flavored Republican majority in the House.

“Republican leaders in the House have only a few hours left to look in the mirror, snap out of it and realize how positively shameful that would be,” Reid said at one point, accusing Republicans of risking a shutdown to pursue a radical social agenda.

Hours later, Sen. Dick Durbin, D-Ill., said on the Senate floor Republicans had abandoned a demand to remake a federal program that provides family planning services and women’s health care in a way that could jeopardize funding for Planned Parenthood.

The proposal drew withering criticism from Democrats during the day, and unexpectedly, several conservative Republican senators urged their counterparts in the House not to shut the government down over the issue.

It was not clear what, if any, substitute might be agreed to.

Republicans and Democrats alike said the GOP appeared to be abandoning a demand to block numerous Environmental Protection Agency regulations on polluters. A federal study of the likely economic impact of the agency’s rules was one possible alternative under discussion, they added.

For much of the day, Reid and Boehner disagreed about what the disagreement was about.

Reid said there had been an agreement at a White House meeting Thursday night to cut spending by about $38 billion. He said Republicans also were demanding unspecified cuts in health services for lower income women that were unacceptable to Democrats.

“Republicans want to shut down our nation’s government because they want to make it harder to get cancer screenings,” he said. “They want to throw women under the bus.”

Boehner said repeatedly that wasn’t the case — it was spending cuts that divided two sides.

“Most of the policy issues have been dealt with, and the big fight is about spending,” he said. “When will the White House and when will Senate Democrats get serious about cutting federal spending.”

By midday Friday, 12 hours before the funding would run out, most federal employees had been told whether they had been deemed essential or would be temporarily laid off in the event of a shutdown.

The military, mail carriers, air traffic controllers and border security guards would still be expected at work, although paychecks could be delayed.

National parks and forests would close, and taxpayers filing paper returns would not receive refunds during a shutdown.

Passports would be available in cases of emergencies only.

Obama canceled a scheduled Friday trip to Indianapolis — and a weekend family visit to Colonial Williamsburg in Virginia — and kept in touch with both Boehner and Reid.

Senate Republican Leader Mitch McConnell of Kentucky sounded hopeful, predicting an agreement and saying, “I assure you, these are not unresolvable issues.”

The House passed legislation Thursday to keep the government running for another week while also cutting $12 billion in spending — and providing enough money for the Pentagon to operate through Sept. 30.

The standoff began several weeks ago, when the new Republican majority in the House passed legislation to cut $61 billion from federal spending and place numerous curbs on the government.

In the weeks since, the two sides have alternately negotiated and taken time out to pass interim measures.