Biden: Tough tradeoffs ahead in budget talks

[June 17, 2011]  WASHINGTON (AP) -- Vice President Joe Biden said Thursday that negotiators for a plan to cut the federal deficit have completed a thorough review of the government's budget and will turn to the difficult trade-offs needed to cut trillions of dollars over the coming decade.

Biden said that both sides have signaled what they might be willing to accept as part of a larger agreement but that they haven't tackled really tough decisions on health care or new revenues. He spoke to reporters after the eighth in a series of meetings aimed at producing an agreement on budget cuts that would accompany must-pass legislation to allow the government to keep borrowing to avoid a default on its obligations.

Biden said that Democrats are willing to go along with changes to federal health care programs and domestic agency budgets if Republicans are willing to accept new revenues and curbs on the Pentagon budget.

"The really tough stuff that's left are the big ticket items and philosophical big ticket items. Anything having to do with health care," he said. "And I don't mean major Medicare reform, but just changes in health care policy."

Biden said that both Democrats and Republicans are going to have to supply votes for any agreement and that each side must display flexibility.

Discretionary spending is the approximately one-third of the budget that's passed by Congress each year for the Pentagon and Cabinet agencies. Republicans are targeting those accounts for major savings while Democrats want to preserve party priorities like education, infrastructure projects and research.

Negotiators are also eying so-called mandatory accounts like farm subsidies, federal employee pensions and student loan subsidies. Thursday's meeting focused mostly on such programs but not on the sticky issue of Medicare and the Medicaid program for the poor and disabled.

The hope is the Biden-led group, which includes top lawmakers from both parties and senior administration officials, will be able to map out a tentative deal by Congress' Fourth of July recess.

"I think the idea is that we would either reach an agreement in principle by then or recognize that we're not able to bridge our differences," said Rep. Chris Van Hollen, D-Md.

Biden said he was confident that any agreement sealed by the group could pass in Congress.

Both sides have taken public positions that will be difficult or impossible to back off. House Speaker John Boehner, R-Ohio, vows that any increase in the so-called debt limit will have to be matched by equally large cuts in spending.

Republicans are also adamant that any final pact not increase taxes or claim revenues from closing tax loopholes like those enjoyed by the oil industry. Democrats are strongly resisting cuts to federal health care programs unless the GOP shows flexibility on revenues.

Without more flexibility, it will be practically impossible to generate $2 trillion-plus in cuts to offset the new borrowing authority required to keep the government afloat until after next year's elections. No one wants to go through the exercise more than once before facing the voters.

"There are differences that are going to have to be bridged and it won't occur until the end," Biden said.

[Associated Press; By ANDREW TAYLOR]

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