Biden: $33 bil. in cuts could stop government shutdown

Vice President Joseph Biden speaks at the White House Recovery and Reinvestment Act Implementation Conference at the White House -- March 12, 2009

STEVE CHIOTAKIS: Eight days and counting to the next budget deadline in Washington. And if Congress doesn't act before April 8 -- a week from tomorrow -- then the government will shut down. Late yesterday, Vice President Joe Biden met with Senate Democratic leaders and said a shutdown could be averted.

Marketplace Washington bureau chief John Dimsdale is with us live. Good morning John.

JOHN DIMSDALE: Hey Steve.

CHIOTAKIS: I thought the shutdown was a real possibility. Why the sudden optimism?

DIMSDALE: Democrats are grasping at a very thin straw. Yesterday afternoon, Vice President Biden met with Senate democrats and they agreed to cut $33 billion from the current year budget. Now, that's a big amount -- probably the largest domestic spending cuts in history. But still only half the cuts called for in the House Republican budget. And Republicans are saying this morning it's not enough. So, while Democrats claim they've achieved the outlines of a compromise to keep the government going, Republicans say, not so fast.

CHIOTAKIS: So then, what were cuts in the Democrats plan?

DIMSDALE: We don't know. The hard choices haven't been made. It kind of shows the bleakness of the political stalemate we've come to in the mere agreement on a level of cuts, without any of the details, is touted as a breakthrough. There's still a real long way to go before Democrats and Republicans can shake hands on a deal.

CHIOTAKIS: What has to happen, John, to avoid a government shutdown?

DIMSDALE: If this really is an agreement, the Democrats have to deliver and pass them in the Senate. The Senate plan would have to be compromised with the House plan. And that calls for $60 billion in spending cuts before Congress can send any final package to the President. It's really a tall order with only a little over a week to go.

CHIOTAKIS: The clock is ticking. Marketplace's John Dimsdale, in Washington. John thanks.

DIMSDALE: Thanks Steve.

About the author

As head of Marketplace’s Washington, D.C. bureau, John Dimsdale provides insightful commentary on the intersection of government and money for the entire Marketplace portfolio.

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