The Senate gave pre-dawn approval today to a $3.7 trillion budget for next year that embraces nearly $1 trillion in tax increases over the coming decade but shelters domestic programs targeted for cuts by Republicans in the House. It's the first budget the Democratic-run Senate has approved in four years, and it just barely did so—by a 50-49 margin. The vote came after lawmakers labored through the night on scores of symbolic amendments, ranging from voicing support for letting states collect taxes on Internet sales to expressing opposition to requiring photo identification for voters.
The Senate's budget would shrink annual federal shortfalls over the next decade to nearly $400 billion, raise unspecified taxes by $975 billion, and cull modest savings from domestic programs. In contrast, a rival budget approved by the House balances the budget within 10 years without boosting taxes. Obama plans to release his own 2014 budget next month, an unveiling that will be studied for whether it signals a willingness to engage Republicans in negotiations or play political hardball. The Democratic budget's $975 billion in new taxes would be matched by an equal amount of spending reductions coming chiefly from health programs, defense, and reduced interest payments as deficits get smaller than previously anticipated.