Finance Bill, Nearing Senate Passage, Would Protect Some Favored Programs

March 20, 2013

New York Times

JONATHAN WEISMAN and ANNIE LOWREY

WASHINGTON — The worst of the federal cuts to a major infant nutrition program would be reversed. Embassy security and construction could be spared in the wake of the consulate attack in Benghazi, Libya. And child care subsidies, once seen as critical to the success of welfare reform, would take a haircut, not the hammer blow that President 

With the expected Senate passage this week of broad legislation to finance the federal government through Sept. 30, a lucky few programs will be spared the brunt of the automatic spending cuts now coursing through the federal government. Also, managers in some departments, especially the Defense Department, will gain more flexibility to carry out cuts.

The overall size of the cuts will remain the same, as will the short-term impact on the economy, because total spending outside of entitlement programs like Medicare and Social Security must remain beneath a hard cap of $984 billion. One program’s gain in the spending bill will mean another’s loss, caution the Democratic and Republican authors of the bill, which the House seems poised to pass as well.

The bill is a mixed blessing for President Obama and others, especially Democrats, who hope Congress will eventually reverse the recent cuts. The changes make the cuts less arbitrary and damaging in the eyes of many independent experts. They reduce the effect on programs that touch national security, child health and welfare, but they inhibit long-term economic growth, through science funding and other areas.

But the new continuing resolution might have a political impact beyond the numbers: It could reduce some of the most obvious disruptions in federal services, potentially easing the pressure that Mr. Obama had hoped would soften Republican opposition to a replacement that combined spending cuts with tax increases.

“The combination of the various appropriations bills, funding transfers and reprogramming authority takes the doom and gloom out of sequestration,” said Chris Krueger, a senior policy analyst at Guggenheim Securities’ Washington Research Group. “You’ve still got $85 billion coming out. You’re still going to get the hit to the economy.”

That means lower employment levels and slower growth this year, public and private forecasters have said. Rather than rearranging the cuts across the budget, Ben S. Bernanke, the chairman of the Federal Reserve, has recommended holding them back until the still-sluggish recovery takes stronger hold. “Besides having adverse effects on jobs and incomes, a slower recovery would lead to less actual deficit reduction in the short run,” Mr. Bernanke said last month.

Republican senators, some of whom have cheered on the “sequestration” cuts, spent Tuesday jostling for last-minute votes on their priorities. The new package of cuts cleared its biggest procedural hurdle Monday night, with a 63-to-35 vote to end debate, but failed to win approval Tuesday.

It still appears likely to pass the Senate this week, given Monday’s vote, and to clear the House shortly after its final Senate vote. The legislation would replace the current stopgap spending law with a more detailed plan.

On Tuesday, Senator Jerry Moran, Republican of Kansas, shut down repeated efforts to get a final vote because he wanted the Federal Aviation Administration to protect control towers at rural airports. Senators Mark Pryor, Democrat of Arkansas, and Roy Blunt, Republican of Missouri, pressed for a vote to ensure meat inspectors would not be furloughed.

Senator Kelly Ayotte, Republican of New Hampshire, pleaded to kill what she called a missile to nowhere — a European-based missile defense system that both the Senate and House armed services committees have repeatedly tried to zero out — and to shift the money to military operations and maintenance.

“There’s not going to be another funding bill for the government until the end of this federal fiscal year,” she said. “This is our only opportunity.”

The primary goal of the bill is to allow lawmakers to make distinctions among programs.

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