Senator Portman floats ideas to solve budget impasse

U.S. Sen. Rob Portman (R-OH) speaks to the crowd at Ohio Republican U. S. Sen. candidate Josh Mandel's election night rally in Columbus, Ohio, November 6, 2012. REUTERS/Aaron Josefczyk
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WASHINGTON (Reuters) - Republican Senator Rob Portman on Monday was circulating a plan to cut federal spending and reform the U.S. tax code as part of a broader plan to reopen shuttered government agencies and provide the Treasury Department with more borrowing authority in order to avoid a default. A Senate Republican aide, who asked not to be identified, said that Portman's proposals were in an early stage with no guarantees that they would gain traction in a Congress deadlocked over budget and debt challenges. While Democratic lawmakers and House of Representatives Republicans also were being consulted, the idea faced a major hurdle. President Barack Obama and his Democratic colleagues in Congress have insisted that there be no negotiations over longer-term budget and tax issues until a week-long government shutdown is ended and the $16.7 trillion debt limit, which could be breached around October 17, is raised by Congress. Nevertheless, as House Speaker John Boehner, a Republican, and Senate Majority Leader Harry Reid, a Democrat, traded stern barbs, Portman's overtures were one of the first signs of a lawmaker working on a plan that was intended to solve Washington's fiscal crisis. Under the proposal, Obama would win a full year of government funding, instead of a short-term spending bill lasting several weeks that would have to be renegotiated in November or December, the aide said. Republicans would get the strict across-the-board spending cuts that currently are in place, which many liberal Democrats, and some more centrist Republicans, want to scrap. The remaining piece of the puzzle would be instructions to tax-writing committees in Congress to write legislation by next year to reform the tax code in a way that would help further grow the U.S. economy. The aide said that Portman, an Ohio Republican, has floated the idea to other Republican senators, including Senate Republican leader Mitch McConnell, as well as some Democrats. (Reporting By Richard Cowan; Editing by Tim Dobbyn)

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