Federal budget negoitiations begin next week

From an Associated Press piece:

Long-standing, entrenched differences over taxes make a large-scale budget pact virtually impossible, according to lawmakers, their aides and observers who will be monitoring the talks. Most Republicans say they simply won't agree to any further taxes atop the 10-year, $600 billion-plus tax increase on upper-income earners that President Barack Obama and Democrats muscled through Congress in January. Without higher taxes, Democrats say they won't yield to cuts in benefit programs like Medicare. "If we focus on some big, grand bargain then we're going to focus on our differences, and both sides are going to require that the other side compromises some core principle and then we'll get nothing done," Ryan, who chairs the House Budget Committee, said in an interview Thursday. "So we aren't focusing on a grand bargain because I don't think in this divided government you'll get one." But a fellow GOP negotiator, Oklahoma Rep. Tom Cole, said Friday that additional revenue could be part of an agreement.
Added Cole: "Both sides would like to deal with the sequester. And we're willing to put more revenue on the table to do that, and we would like to do it with entitlement savings." Cole was not talking about raising tax rates; one option he mentioned would be to give corporations incentive to repatriate untaxed overseas profits.

The next round of sequester cuts are a big issue:

The White House and Democrats are pressing to include new revenue from closing tax loopholes and infrastructure spending to boost the economy. Before departing the White House on Friday for stops in New York City, Obama discussed the budget process by phone with Senate Majority Leader Harry Reid of Nevada, House Democratic Leader Nancy Pelosi of California, Murray and Chris Van Hollen of Maryland, the top Democrat on the House Budget Committee. He did not make a similar call to congressional Republicans.  "Even if we do not have the big grand bargain, if you were to have a medium deal or small deal, those deals could have permanent loophole closures and permanent mandatory savings that would help our permanent long-term fiscal situation," senior White House official Gene Sperling told a business group Friday.
The automatic spending cuts are required because a 2011 deficit-reduction supercommittee failed to reach an agreement. The cuts would carve $91 billion from the day-to-day budgets of the Pentagon and domestic agencies in 2014 compared with the spending caps set by a 2011 budget deal. The Pentagon would absorb almost 60 percent of the cuts.


Starving the beast through sequester.....and continued austerity.  We live in interesting times, don't you think?

AP News: Both sides agree: No major budget deal foreseen