Updated 2:31pm EST 14 January 2014
Econintersect: For the first time since Barack Obama became president the U.S. Congress has agreed to a compromise budget that is expected to pass both the House and the Senate. It is hoped that the House will pass the budget Wednesday (15 January 2014) when current continuing appropriations run out. But Bloomberg says lawmakers are prepared to pass an emergency 3-day stopgap appropriation if needed to extend government operations to 18 January if it takes that long to get the bill passed and signed into law. The budget covers the discretionary spending of the federal government and comes to $1.01 trillion for fiscal year 2014 which ends 30 September. President Obama had initially proposed $1.15 trillion in April 2013.
Some of the features of the bipartisan bill:
- It satisfies the general spending levels agreed to in December by Rep. Raul Ryan (R, WI) and Sen. Patty Murray (D, OR).
- It restores cost-of-living increases originally cut for pensions of disabled military veterans.
- No restrictions will be imposed on climate change programs or the implementation of Obamacare.
- It contains a pay freeze for the vice-president and senior political appointees.
- It denies ratification of IMF funding quotas established in 2010 which would increase the capital contributions to the fund to increase its ability to react to financial crisis. The 2010 changes cannot be made until the U.S. ratifies.
- Military pay is increased 1%.
- Military R&D is reduced by 10%, the National Science Foundation receives a very small cut while the NIH (National Institutes of Health) gets a 3% increase.
There are no estimates yet found by Econintersect as to how the budget deficit estimates by the CBO (Congressional Budget Office) will be affected. Seven months ago the estimate for 2014 was a deficit of $560 billion, down 13% from $642 billion for 2013.
Update 2:31pm 14 January 2014: Ed O'Keefe in The Washington Post has been keeping an updated and corrected accounting of the contents of the new spending bill.
House Unveils $1.01 Trillion Measure to Fund U.S. Government (1) (Derek Wallbank, Bloomberg Businessweek, 13 January 2014)
US Congress agrees $1tn spending deal (Robin Harding, Financial Times, 14 January 2014)
President Obama Proposes 2014 Budget (National Priorities Project, 10 April 2013)
Updated Budget Projections: Fiscal Years 2013 to 2023 (CBO, May 2013).