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Senate prepares to pass budget deal

Senate prepares to pass budget deal

BUDGET DEAL: U.S. Senator John McCain (R-AZ) talks to reporters after a Senate cloture vote on budget bill on Capitol Hill in Washington Dec. 17. Photo: Reuters/Yuri Gripas

By David Lawder

WASHINGTON (Reuters) – The U.S. Senate was ready on Wednesday to pass a two-year budget deal aimed at avoiding a government shutdown in January despite objections by senators from both parties to proposed pension cuts for military retirees.

Final passage was all but assured on Tuesday when the Senate voted 67-33 to advance the measure to a final, simple majority vote late Wednesday afternoon in the Democratic-controlled chamber.

The deal, passed by the House last week, restores overall fiscal 2014 spending levels for so-called “discretionary” programs to $1.012 trillion, trimming the across-the-board budget cuts that were set to begin next month by about $63 billion over two years.

The money to offset the restored funds will come from a variety of sources, including increased security fees for airline passengers and pension-related cuts for federal employees and military retirees.

The small-scale deal does not increase tax revenue as Democrats wanted nor cut non-discretionary federal benefits programs, known as “entitlements,” as Republicans wanted.

The military retiree pension cuts sparked the most debate.

Republican Senator John McCain urged passage because the deal would spare the military from much larger budget cuts in 2014, which would impact training and military readiness.

“This is the essence of what we’re supposed to be doing,” McCain said. “The option of shutting down the government is something that I don’t really understand.”

(Reporting By David Lawder; Editing by Fred Barbash and Cynthia Osterman)

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