Failure's consequences laid out in US budget fight

WASHINGTON (AP) — A new plan by Senate Democrats to head off severe automatic spending cuts in two weeks met an icy reception from Republicans on Thursday as the Obama administration warned that failing to reach a deal would mean thousands of air traffic controllers sidelined, the idling of meat-processing plants, 10,000 laid-off teachers, and much more.

President Barack Obama made solving the budget impasse a major priority in this week's State of the Union address to Congress.

As part of their solution to the impasse, Democrats are proposing a minimum tax on the wealthy, a non-starter with Republicans, as well as cuts to much-criticized farm subsidies and more gradual reductions in the Pentagon budget than will happen if the automatic cuts, known in Washington-speak as sequester, kick in.

Republicans vowed to kill the Democratic legislation encompassing the plan when a vote is called the week of Feb. 25 — just days before the across-the-board cuts would start to slam government operations and the economy.

The across-the-board cuts would result from the failure of a 2011 deficit "supercommittee" to reach agreement on a deficit reduction plan. The original idea was to make the prospect of sweeping, automatic cuts so severe that Democrats and Republicans would be motivated to strike a budget bargain to head it off.

The New Year's Day "fiscal cliff" deal merely made expiring Bush-era tax cuts permanent for all but the wealthiest Americans, and fell short of a so-called grand bargain, leaving the new Congress to deal with the automatic spending cuts.

Release of the Democrats' plan set off a predictable round of bickering in a capital that remains at a loss over how to prevent the sequester, even as more and more details on the impact of the cuts are being released by panicked agency heads.

"Their whole goal here isn't to solve the problem, it's to have a show vote that's designed to fail, call it a day, and wait for someone else to pick up the pieces," Senate Republican Leader Mitch McConnell of Kentucky said of Democrats.

Democratic Senate Budget Committee Chairman Patty Murray called the Democratic measure, with its 50-50 mix of new tax revenue and spending cuts, a "fair and balanced approach" that "protects our country from moving into a very, very fragile position."

The debating points quickly formed.

"Now, Republicans in Congress face a simple choice," said Jay Carney, Obama's spokesman. "Do they protect investments in education, health care and national defense or do they continue to prioritize and protect tax loopholes that benefit the very few at the expense of middle and working class Americans?"

The automatic sequester cuts that the Democratic bill is trying to avoid would drain $85 billion from the government's budget over the coming seven months, imposing cuts of at least 8 percent on the Pentagon and 5 percent on domestic agencies.

Administration officials, in testimony to the Senate Appropriations Committee or letters to the panel, gave more shape to what they say is likely to happen absent a breakthrough.

Lawmakers were told 15,000 air traffic controllers would be laid off for more than two weeks, the furloughing of inspectors for up to 15 days would force intermittent closures of meat and poultry plants, a relief fund for disaster victims would lose $1 billion, 70,000 pupils would be removed from the Head Start preschool program, and mental health treatment could be denied to more than 373,000 people who need it. More than 3.8 million people out of work six months or longer could see their unemployment benefits reduced by close to 10 percent, and up to 600,000 women would be dropped from the Women, Infants and Children program that gives aid and nutrition education to pregnant and postpartum mothers.

As well, security at U.S. diplomatic installations, incredibly sensitive since the Sept. 11 attack in Benghazi, Libya, would be hampered, as would international peacekeeping operations in Mali and elsewhere and programs combatting terrorism, weapons proliferation and drug trafficking, lawmakers were told as part of a long list detailing the predicted fallout.

To be sure, officials were casting the likely consequences in dire terms, as is always the case when agency budgets are threatened. The sequester law exempts benefits like Social Security pensions and the Medicare and Medicaid health care programs from cuts, and the White House has instructed agencies to give priority to avoiding cuts that "present risks to life, safety or health." But there is no question the cuts would bite deep, and most programs are vulnerable.

The top Republican in Washington, House Speaker John Boehner,, told reporters on Thursday it's up to Senate Democrats to see if they can pass legislation to replace the sequester with other spending cuts.

The Senate bill would forestall the cuts through Dec. 31 and substitute about $110 billion in deficit savings over the coming decade. Almost $1 trillion worth of cuts over the coming eight years would remain in place.

But Republicans oppose the measure because it contains a 10-year, $54 billion tax increase that would require people with million-dollar incomes to pay at least a 30 percent income tax.