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CBO score shows the Budget deal is a compromise, rare in DC

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The Congressional Budget Office late Wednesday released its analysis of the Budget deal reached by Republican Congressman Paul Ryan and Democratic Senator Patti Murray. On first read, the architects came up with a textbook compromise: each side gave 50 percent to meet in the middle. That is what compromise is. It may explain why both sides are attacking it.

Speaker Boehner announced that the two-year Budget bill will be voted on Thursday. If passed and signed by the president, it will give Americans a two-year reprieve from fear of a government shut down and save us thousands on hours of news stories about the pending crisis.

The compromise established a top-line spending level of $1.012 for 2014 compared to $967 billion under the sequester. However, it is $45 billion less than the $1.058 trillion level before the sequester took place.

In the second year--2015, the top-line spending level is $1.014 trillion. That is $19 billion more than the $995 billion sequester level in place for 2015 but $72 billion less $1.086 trillion that would be in place without the sequester.

The CBO said the deal contains $78 billion in direct spending reduction and $7 billion in revenue. This means more than $10 of spending cuts for every dollar of revenue, and the revenue comes in user fees, not tax increases. In addition, there is $23 billion in deficit reduction in the package.

Democrats wanted to get rid of the sequester entirely. Republicans wanted to keep it, and some wanted to cut beyond the sequester. In the first year, the sides met in the middle. In the second year, Republicans came out better. However, the bill does not cut Social Security or Medicare, so Democrats won on that point.

Despite this, the right-wing of the Republican Party is outraged. Many Democrats are unhappy as well. If the center can hold, this will be the first real compromise since Republicans took control of the House after the 2010 election.

Since the art of compromise has been dead in Congress, no one remembers what a compromise is. The very nature of compromise is that neither side gets 100% of what they want. Compromise is the art of “doing no harm.” This bill is underwhelming for both sides because it does no harm.

Americans say they want compromise, so Americans need to reward the compromisers and punish those who plan on blocking it. If this fails, compromise will be nothing but a reference in history books.

There are many things that are hard to swallow for Democrats in the deal for sure. If there is one blatant flaw in the deal it is that it does not extend unemployment benefits for 1.3 million Americans. Unless Congress passes a stand-alone bill, those Americans who have been out of work long-term will lose benefits after Christmas. This is the main sticking point with Democrats, and they are correct to be unhappy. The loss of benefits will hurt those families, but it will also hurt the economy by reducing the amount of money they have to spend of food an other goods after New Years.

Congressman Ryan said Thursday he would be open to a proposal on unemployment if it had off sets in spending. Whether that will happen before it goes to the president is not known.

The alternative to this deal was another divisive budget showdown and potentially a shut down. To avoid that, there would be a series of short-term budget extensions that are killing the economy.

The Budget has brought fighting in the Republican civil war out into the open. Right-wing groups blasted the deal before the read it prompting Speaker Boehner to call them “ridiculous.” Conservatives and Tea Party Republicans, who engineered the last government shut down, have accused “moderate” Republicans of waging a war on conservatives. Senate Republican leader McConnell is also opposed. Most of these so-called moderate Republicans were the conservative wing of the GOP just a few years ago.

We will find out if compromise is really possible over the next few days. Stay tuned.

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