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White House signals support for deal to avoid shutdown

But it says Republicans and Democrats need to find a longer-term deal to prevent the threat of a disruption in services later this year.

February 28, 2011|By Lisa Mascaro and Christi Parsons, Washington Bureau
  • House Majority Leader Eric Cantor stood with fellow Republicans in favor of budget cuts. Asked about potential government job losses, he said, "Why is the government hiring people it can't afford to pay?"
House Majority Leader Eric Cantor stood with fellow Republicans in favor… (J. Scott Applewhite, Associated…)

Reporting from Washington — The White House signaled Monday that it is open to a proposal to avert a government shutdown for two weeks, but congressional negotiators have yet to come up with a way to prevent the threat of a disruption in services later in the year.

Congress and the White House may act in time to avoid a shutdown this week, but deep divisions between Republicans and Democrats cast doubt over whether the two sides can compromise on a more durable proposal.

The House is expected to vote Tuesday on a GOP stopgap measure that would cut $4 billion over two weeks by eliminating programs President Obama has targeted for termination, among others. Senate Democrats have indicated they are open to the proposal, and the administration says it may go along.

But the White House also said that a longer-term deal is essential to reduce "uncertainty" of continued stopgap measures that could harm the economy.

"If we keep returning to this every couple of weeks, that is a concern," White House Press Secretary Jay Carney said.

He declined to pinpoint a timeframe that the president would accept, saying only that the "focus has to be on the impact on the economy."

Lawmakers returned to Washington after a week in their home districts as Americans began to focus on the size and scope of the cuts the Republican-led House approved last month.

The GOP bill, which Obama vowed to veto, would cut more than $60 billion over the remaining seven months of the fiscal year, in one of the largest one-time reductions of its kind.

It would subtract billions of dollars from the Head Start preschool program, college grants, healthcare, infrastructure and other domestic federal programs, and would result in the loss of thousands of federally funded jobs, possibly including some in local law enforcement. But Republican leaders are confident of its public backing.

With "tea party" activists calling for even steeper reductions, GOP House leaders said their stopgap proposal also is drawing support — even though it no longer includes top Republican priorities, such as de-funding Obama's healthcare law.

"The feedback we've gotten has been very, very positive," said Rep. Peter Roskam (R-Ill.), a party leader.

Congress must approve a spending plan by the end of the week to avoid a shutdown. The resolution funding the government expires at midnight Friday.

Tuesday's expected House vote comes as economists dispute the economic toll of the larger cuts.

Mark Zandi, chief economist at Moody's Analytics, said the House-passed bill would eliminate up to 700,000 jobs over the next two years and shave 0.5 percentage points from the 2011 growth in gross domestic product. His assessment reflected similar warnings from Goldman Sachs last week.

But Republicans are circulating the findings of John Taylor, an economics professor at Stanford University and a senior fellow at the Hoover Institution. Taylor says government cuts would increase growth and employment by encouraging private-sector investment.

Asked about the potential for government job losses, House Majority Leader Eric Cantor (R-Va.) said Washington should not retain workers if it lacks funds.

"Why is the government hiring people it can't afford to pay?" Cantor said Monday.

In the Democratic-led Senate, leaders have not yet indicated whether they will support the GOP's stopgap proposal, and Democrats continued preparing their own plan for spending cuts.

Some House Democrats, including Minority Leader Nancy Pelosi (D-San Francisco), said cuts in the GOP's stopgap measure go too far, particularly in education.

But Sens. Jon Tester (D-Mont.) and Ben Nelson (D-Neb.), who face difficult reelection campaigns, proposed reductions Monday that would include freezing congressional pay and reducing lawmakers' office expenses.

A poll by the Hill, a Washington newspaper, indicated that Democrats and Republicans would share blame among voters for a government shutdown. According to the survey, Democrats would be blamed slightly more than Republicans.

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