When Congress returns to Washington, D.C. after the Thanksgiving break, budget negotiators will have to scramble to strike a deal on federal spending. If they fail to reach an agreement, the country could face yet another round of steep, automatic spending cuts. Our Washington, D.C. bureau reporter Geoff Bennett has more.
WASHINGTON, D.C. -- Another deadline looms in Washington. December 13th is the date by which Republicans and Democrats on the budget conference committee need to come up with a long-term agreement to end the across the board cuts known as sequestration.
But budget committee members now say that if the panel reaches a deal at all, it’s likely to be small in scope.
"Our goal is to do good for the American people," said Wisconsin Representative Paul Ryan.
Neither side is expected to get what it most wants. For Democrats, that means new tax revenue and for Republicans, cuts to Social Security and Medicare. The committee is said to be looking at options other than new taxes to raise revenue, including doubling the transportation security fee that travelers pay for nonstop flights.
Absent a deal, $109 billion in sequestration budget cuts go into effect January 2nd. President Obama says it’s an irresponsible way to govern.
"Frankly, we’ve got to stop governing by crisis here in this town. Because if it weren’t for Washington’s dysfunction, I think all of us agree we’d be a lot further along. The shutdown and the threat of default harmed our jobs market, they cost our economy about $5 billion and economists predict it will slow our GDP growth this quarter and it didn’t need to happen," Obama said.
Many economists also predict a lasting impact on businesses and job growth if the spending cuts continue into next year.
"The sequester creates an air of uncertainty, which then makes business activity in the United States more difficult. So consumers and businesses don't necessarily know where those cuts are going to occur and there's certainly a chilling effect that those sequestration cuts can have. For example, there are some estimates that the sequester might have caused just below one million jobs to be lost or rather that 900,000 jobs could have been created," said Bradley hardy, Assistant Professor, Department of Public Administration and Policy at American University.
The House and Senate are in session together for just four days in December, hardly enough time for the chambers to hash out a big bipartisan deal. So Washington waits and watches for the smaller budget committee to find a fiscal path forward.