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April 11th, 2011
02:15 PM ET

Obama, Congress prepare for next round of budget fights

Alan Silverleib
CNN

Washington (CNN) - Partisan warfare over taxes and spending is set to take center stage again in Washington this week, as Congress takes up a deal covering the budget for the remainder of the current fiscal year and President Barack Obama unveils his long-awaited deficit reduction plan.

House Republicans are also expected to push for a vote by Friday on their budget proposal for the next fiscal year. That plan, which cuts roughly $6 trillion in spending over the next decade while radically overhauling Medicare and Medicaid, is fiercely opposed by Democrats at both ends of Pennsylvania Avenue.

The outcome of the fight promises to have a major impact not only on the 2012 presidential race but on the size and scope of the federal government for years to come.

Obama and congressional Republicans have "very different visions over what the role of the federal government should be in our society," House Speaker John Boehner, R-Ohio, said Monday morning on Fox News. But "it's our obligation to sit down and ... find a way to work together."

Details of the deal covering the rest of fiscal year 2011, which ends September 30, are to be released Monday night.

The package, which was finalized late Friday in order to avoid a partial government shutdown, cuts spending by a total of $38.5 billion. It has been called insufficient by some Tea Party conservatives and labeled extreme in liberal quarters.

The House is scheduled to vote on the deal Wednesday, with the Senate following suit shortly thereafter.

Adding to the uproar: a coming debate over the need to raise the federal government's debt limit. Washington is rapidly nearing the roughly $14.29 trillion ceiling and is expected to exceed the cap by mid-May. Although the Federal Reserve can take some steps to delay the need to raise the cap until July, a failure to do so could ultimately lead to a default.

A default could devastate the economy, leading to a crashing dollar and skyrocketing interest rates, among other things.

Republicans are using the vote on the debt ceiling to demand additional spending reductions.

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soundoff (4 Responses)
  1. Gary Dubois

    As David Gergen said, this is the Titanic. I am liberal like Robert Kennedy was. And I think if he were here, He would say. We are pushing out nation into Hyper inflation. Look at what that did to Germany.We are going to have with wisdom and maturity.

    April 11, 2011 at 11:35 pm |
  2. Doria Dieckmann

    It's absolutely ridiculous that our country, which is supposed to be the most powerful country in the world, is going broke? Instead of supporting the world, government should have made sure that our country is covered first!!!! So much money has been wasted on stupid grants, etc,..and bailing out the banks, when all they're doing is giving bonuses
    to employees and are still issuing foreclosures to poor families!!!!Will these budget cuts affect the housing programs that seniors and the disabled need so urgently???? I sure hope not!!!!!

    April 11, 2011 at 11:33 pm |
  3. Doug

    Why does the GOP continue to get a pass concerning the Iraq and Afghanisean wars being kept off the books during the Bush years? They(GOP) continue to scream how much Barack Obama has increased the national debt and no one calls them on it.

    April 11, 2011 at 10:31 pm |
  4. Helen

    Paul Ryan's voucher plan for medicare is not viable. What for profit health insurance company wants senior citizens?
    I wonder if the Tea Party has thought about all the jobs that would be lost if they cut government to the bone?
    I heard the government owes social security 4.5 trillion dollars. That would keep social security solvent for years. Move the payback to 20 years that would give us a 4.5 million cut on the deficit.

    April 11, 2011 at 10:22 pm |