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Spending cuts will affect nearly every federal agency

Negotiators identify the specifics of the $38-billion budget deal that averted a government shutdown. The Pentagon will receive an extra $5 billion. Conservative Republicans say it doesn't cut enough.

April 12, 2011|By Lisa Mascaro, Washington Bureau
  • Funding for an alternative Joint Strike Fighter engine is expected to be eliminated.
Funding for an alternative Joint Strike Fighter engine is expected to be… (Lockheed Martin Corp. )

Reporting from Washington — The largest domestic spending cut in U.S. history will upend almost every federal agency and slash programs dealing with healthcare, transportation and education, but will give the Pentagon an extra $5 billion, according to aides familiar with the negotiations.

It preserves funding for some of President Obama's cherished initiatives, including the healthcare and Wall Street overhauls and his education program, Race to the Top. But four of the president's policy czars get the ax: healthcare, climate change, cars and urban affairs.

House Speaker John A. Boehner (R-Ohio) may be forced to rely on Democrats to pass the bill. Conservative Republicans argue that it does not adequately cut programs and services.

"Make no mistake: I oppose this negotiated deal," Rep. Michele Bachmann (R-Minn.), founder of the House Tea Party Caucus, said on Twitter. She wanted deeper cuts and conservative policy priorities, including elimination of funds for family planning and the healthcare overhaul.

Voters approve of the deal and credit Obama and congressional Democrats more than Republicans for reaching it, according to a CNN survey released Monday.

The GOP-led House had hoped to convene shortly before midnight Monday to introduce the bill, complying with rules that legislation be posted three days before a vote. That had been scheduled for Wednesday, but as negotiators continued to work past midnight to hammer out the details, the schedule was in flux.

The measure, which Congress was expected to pass, would achieve $38 billion in reductions in the remaining six months of the 2011 fiscal year and avert, at least for now, the threat of a government shutdown.

Money for one high-profile Pentagon project, $455 million for an alternate engine for the Joint Strike Fighter jet that was to be built near Boehner's district, was expected to be eliminated.

The Head Start preschool program was spared. But summer school Pell Grants for college students were eliminated to save $493 million.

Cuts included $2.5 billion that would have helped launch cooperatives to compete with insurance companies — an experiment the Congressional Budget Office said would be unlikely to succeed.

Nearly $18 billion in cuts come from accounts that must be funded and sometimes have surpluses, such as nearly $5 billion from a crime victims' fund and $400 million from a Treasury forfeiture account that had record seizures in 2010.

Similarly, $3.5 billion comes from a health program that rewards states for increasing the number of uninsured children in the Medicaid program with simplified enrollments.

The Democrats' strategy to draw down such accounts was intended to shield other agency programs from cuts that would be politically difficult to reinstate in the future.

The budget deal blocks money to transfer detainees from the Guantanamo Bay military prison to mainland courts. Negotiators also agreed not to reinstate the nuclear waste repository at Yucca Mountain in Nevada, home state of Democratic Sen. Harry Reid, the majority leader.

A proposal that would take wolves off the endangered species list, possibly allowing them to be hunted in Western states, was retained, but another that would have loosened restrictions on shotgun and rifle sales was dropped. A needle exchange program for the District of Columbia also was eliminated.

Nearly 35 domestic programs were terminated or severely reduced by the first $10 billion in cuts, which came in a series of stopgap deals to keep the government running during the five-week stalemate. Friday's agreement added cuts worth another $28 billion.

Earlier trims include more than $500 million from literacy programs for children and initiatives to reduce high school class sizes, and $350 million for job training.

Also axed was $650 million from highway accounts, $200 million for wildfire suppression and $276 million for flu pandemics that the administration said could be covered from other sources.

Lawmakers returned to the Treasury nearly $2 billion left over from the 2010 census, and cut $30 million to repair the Smithsonian "castle" on the National Mall. Less than $1 million was reclaimed from a 2009 bicentennial celebration for President Lincoln.

Congress also relinquished more than $5 billion in funds that lawmakers requested for various home-state projects — including law enforcement grants and salaries for animal and plant health inspectors.

Monday's cuts take another $3 billion from transportation and reduce funds for wetlands restoration, crop insurance rebates and rural economic development. A program to combat fraud in the H1B visa program for specialty workers loses $140 million.

As more details of the agreement emerged, so did political divisions. A coalition of liberal Democratic lawmakers from New York denounced the cuts as an assault on basic government services. Meanwhile, conservatives ridiculed the severity of the trims.

Freshman Rep. Justin Amash (R-Mich.) was among 28 Republicans who voted against the stopgap measure Friday to keep the government running while the final package was assembled. He mocked the deal in a tweet: "A 'historic' cut?"

"The side of big government got 97% of what they want," said Sen. Rand Paul (R-Ky.), who announced he would vote no. "I prefer to be on the other side."

lisa.mascaro@latimes.com

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