Federal budget deal faces test in House

WASHINGTON — Congressional budget negotiators reached a hard-fought deal Tuesday aimed at avoiding another government shutdown, agreeing on a plan that would restore some money to programs hit by impending across-the-board cuts but trim spending on federal retirees and raise fees on airline travel.

Final passage of the $85-billion package, however, remains uncertain because of rising opposition from tea party lawmakers and influential conservative groups. A House vote, expected this week, will once again test the ability of Speaker John A. Boehner (R-Ohio) to hold together enough Republicans to pass the compromise with support of the chamber’s Democratic minority.

The two-year deal, negotiated by the GOP’s budget point man, Rep. Paul D. Ryan of Wisconsin, and his counterpart in the Senate, Democratic Sen. Patty Murray of Washington, delivered a rare bipartisan budget agreement after two years of financial brinkmanship in Washington.

“Because of this deal, the budget process can now stop lurching from crisis to crisis,” said Murray, chairwoman of the Senate Budget Committee.

PHOTOS: 2013’s memorable political moments

Ryan, the former Republican vice presidential candidate whose political credibility may rest with his ability to sway his conservative colleagues, praised the agreement because it will further reduce the federal deficit by $23 billion and contains no new tax increases.

“I see this agreement as a step in the right direction,” Ryan said. “In divided government, you don’t always get what you want.”

The last budget standoff culminated in a 16-day shutdown in October, costing the government billions of dollars and driving Americans’ approval of Congress to record lows.

The agreement would undo $63 billion of the automatic “sequester” budget cuts that are set to take place over the next two years, slicing across government agencies and programs, including the Pentagon. Lawmakers from both parties, including defense hawks, are eager to avoid the arbitrary cuts.

But some tea party conservatives would prefer to live with those reductions, however painful, to keep down government spending.

Sen. Marco Rubio of Florida, like Ryan a potential GOP presidential contender in 2016, opposed the deal.

“This budget continues Washington’s irresponsible budgeting decisions by spending more money than the government takes in,” Rubio said, adding that the American people “deserve better.”

The deal sets 2014 spending at $1.012 trillion, higher than the $967 billion that would have taken effect under the sequester law on Jan. 15, but less than Democrats wanted. The increased spending is paid for with new fees and cuts elsewhere in the federal budget, including reductions in federal employee retirement benefits, cuts to the cost-of-living adjustment for military retirees who are younger than 62 and not injured or disabled, and new fees on airline travel.

The package does not include an extension of unemployment insurance, as President Obama had sought, for an estimated 1 million jobless Americans whose benefits expire after Christmas.

PHOTOS: The battle over Obamacare

“This agreement doesn’t include everything I’d like — and I know many Republicans feel the same way,” the president said. “That’s the nature of compromise.… The American people should not have to endure the pain of another government shutdown for the next two years.”

But the accord did little to placate leading conservative groups, who attacked the deal even before its details were announced.

“We’re going to hold them accountable if they go back on sequester,” said Tim Phillips, president of the conservative Americans for Prosperity, backed by the billionaire Koch brothers. “The message is simple: Keep your word.”

“There’s a real concern about giving up the sequester,” said Sen. Orrin G. Hatch (R-Utah), saying he would be disinclined to back such a deal. “Republicans know that the one major victory they had was the sequester.”

Ryan was expected to brief his House Republican colleagues Wednesday.

Boehner has faced a similar challenge in the past, when his right flank rejected previous budget deals. If the speaker lost the support of his House Republican majority, he would be forced to rely on Democrats for passage, something he has been reluctant to do because it dilutes his power.

Already, 30 House Republicans have signed a letter in support of the sequester cuts, and GOP aides expect as many as 100 Democratic votes would be needed to secure passage because of likely Republican defections.

But as details of the deal emerged, it was unclear whether Boehner could pick up enough Democratic support. Rep. Raul M. Grijalva (D-Ariz.), co-chairman of the progressive caucus, said he opposed any deal that failed to close corporate tax loopholes.

Jim Dean, chairman of Democracy for America, said Democrats should reject the deal because it failed to include an unemployment insurance extension. “Negotiators have declared ‘War on Christmas,’ and potentially sentenced millions of struggling Americans to a very bleak New Year,” he said.

But another Democrat, Rep. Gerald E. Connolly, whose northern Virginia district includes many federal employees, said the cuts to retirement benefits would be a “hold your nose and vote yes” compromise.

In the Senate, where Democrats have the majority, Majority Leader Harry Reid (D-Nev.) would need a handful of Republican votes to overcome an expected tea party-led filibuster. Democrats hold 53 seats, and two independents caucus with them, but 60 votes are required to overcome a filibuster. (The recent filibuster rules change pertained to most nominees, not to legislation.)

Pressure on Republican senators was coming not only from conservative groups, including Heritage Action and FreedomWorks, but from conservative candidates who are challenging incumbents in 2014 primary races.

Sen. Mitch McConnell, the Republican minority leader who is facing a primary attack from the right flank in Kentucky, said Tuesday that the sequester law had been a “success, and I hope we don’t revisit it.”

But Sen. Angus King, an independent from Maine who caucuses with Democrats, said the price of inaction would be higher. “Just doing it is important,’’ he said. “If it doesn’t get done, it’s bad news.”

lisa.mascaro@latimes.com