The Senate kills the two Budget Proposals

The senate this afternoon defeated the spending proposals for the remainder of 2011 offered by the Democrat leadership as well as by the House Republicans. Neither vote was even close. Democrats made clear that they are not serious about cutting spending for the current year by any amount that might make a difference in the trajectory of government outlays. Republicans made clear that they would not accept the paltry amount of cuts offered by the Dems. So, as the commentators like to say, we are back at square one and the question is "What comes next?"

There are only two likely answers. First, we may see another continuing resolution passed for three more weeks with cuts of $6 billion included. this would be the $6 billion that the Democrats are already offering. that just shoves the problem further down the road. Secondl, we could see Obama actually get engaged in the discussion so that he can make a deal with the GOP and set it forth as his proposal. That process worked well with regard to the extension of the tax rates passed last December. It ought to work well this time as well. There are enough Democrats who will feel compelled to support the deal struck by Obama that passage is likely. The problem with such a deal is that it forces Obama to actually take a position on the budget, something that he has avoided for years.

My guess is that we will soon see another continuing resolution.