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US budget cuts to kick in as Congress fails again


Leaders of a divided Congress failed to avert huge spending cuts set to begin Friday, with President Barack Obama trading blame with Republicans over the doomsday scenario that may lie ahead.

The only related actions of substance Thursday appeared to be votes on two competing bills, one sponsored by Democrats and the other by Republicans, to replace the budget austerity with targeted spending cuts and tax revenues.

In a sign of what Obama described as typical Washington "dysfunction," both bills failed to advance in the Senate.

The president swiftly pointed the finger at Republicans for refusing to adopt his plan to avoid the $85 billion in mandated reductions set to ravage the US economy this year.

Obama said that by refusing to allow a vote on a bill that includes a balance of tax revenue and targeted cuts, Republicans are "threatening our economy with a series of arbitrary, automatic budget cuts that will cost us jobs and slow our recovery."

The inaction ensures that no legislative solution will be ready before the so-called sequester kicks in on Friday, when federal programs in every agency including the military will suffer reductions.

"As a nation, we can't keep lurching from one manufactured crisis to another," Obama said, reiterating a point he has made since the "fiscal cliff" negotiations last December led to only a partial fix of looming budget issues.

He will make a final plea to bickering congressional leaders at a White House meeting on Friday, where he will come face to face with Republican House Speaker John Boehner and top Senate Republican Mitch McConnell after they lambasted him Thursday for failing to lead America out of the fiscal turmoil.

The sequester was sealed into law in 2011, when the White House and Republicans agreed on wide-ranging cuts designed to be so painful that they would force lawmakers to reach a more palatable compromise to rein in the debt.

But lawmakers from both sides have already acknowledged that sequester is a reality, at least temporarily, and that a solution could arise from March negotiations over funding government operations for fiscal year 2013.

"We've laid our cards on the table," Boehner said in explaining why his chamber, which passed two sequester-relief bills last year, would take no further action until the Senate passed a bill.

John Cornyn, the number two Senate Republican, said Obama and his Democrats have been overstating their "apocalyptic predictions" of hundreds of thousands of job losses, a slash in economic growth, and harsh cuts to social services and national security.

"I would suggest... put down the Beltway Kool-Aid, because they are predicting a disaster that will not occur," Cornyn said.

Some House Republicans agreed. "It is going to happen. It is 2.4 percent of the budget, and it is not the end of the world," Representative Jim Jordan said in US News & World Report.

"We want to bank those savings, and we want to move on."

The Democratic bill that failed in the Senate was what Obama touted as a "balanced" plan that raises new tax revenue and slashes several billion dollars in farming subsidies.

Republicans laid out a competing version that maintains the full financial effect of sequester, without raising new revenue, but gives the president broader "flexibility" to map out where the cuts would hit.

Senate majority leader Harry Reid complained that such a plan would force Obama into deciding which programs stay and which get the ax.

But McConnell said that is precisely the leadership Obama needs to show in a time of crisis.

"It's your job to make the tough decisions," McConnell said of the president.

Democrats are trying to force Republicans into accepting more revenues through closing tax loopholes for millionaires.

But conservatives stood firm, saying Obama gained the $600 billion in tax revenues he wanted in the last fiscal negotiations in late December.

"Given those facts, the revenue issue is now closed," Boehner insisted.

Senate Democrat Chuck Schumer blamed Boehner for running out the clock until sequester hits, and he sounded resigned to the sequester sliding into effect after Friday.

"The debate's only beginning," he said. "In the coming weeks... we'll consider a budget that will keep these issues front and center."