"While modest in scale, this agreement represents a positive step forward by replacing one-time spending cuts with permanent reforms to mandatory spending programs that will produce real, lasting savings"
- John Boehner, House Speaker
U.S. budget negotiators reached a deal on Tuesday that could end three years of fiscal crisis, which culminated with the partial shutdown of the federal government in October. Chief architects, Representative Paul Ryan and Senator Patty Murray, said that the agreement prevents a government shutdown, when funding authority expires January 15, and helps the U.S. economy, which had been suffered from a series of fiscal feud. Under the deal, the government will be financed for two years, automatic military and domestic spending cuts will be eased by about $63 billion over two years, while the deficit will be reduced by $23 billion. The main components of the agreement include increasing contributions that federal employees make to their retirement plans as well as rising premiums for pensions backed by the Pension Benefit Guaranty Corp. If approved by Congress, it will be the first budget since 2011.
Despite a wide support, the deal faces a challenge from some House conservatives and will need backing of the minority Democrats to pass. The House has to vote this week on the package. Nevertheless, Mr. Ryan said he was optimistic the new budget agreement could pass both sides of the extremely politically divided Congress. President Barack Obama said the deal is a "good first step" toward a compromise that will meet some of his goals for spending priorities.
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