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Timeline: From deal to gridlock on spending

Thursday - 9/13/2012, 3:52pm  ET

By The Associated Press

(AP) - A little more than a year ago, Congress and President Barack Obama sealed an agreement on the budget that was supposed to cut the deficit by $2.1 trillion over 10 years and make it easier for Congress to pass the appropriations bills setting agency budgets. Instead, the government is nearing a fiscal cliff and using a six-month spending bill to avoid a government shutdown.

A timeline of major events in the budget crisis:

2011:

_May-June: Facing a deadline to prevent a first-ever default on U.S. obligations, Vice President Joe Biden convenes talks with lawmakers on raising the government's borrowing cap and pairing the debt limit increase with deficit cuts. After several weeks, House Majority Leader Eric Cantor, R-Va., abandons the talks over Biden's insistence that any agreement include tax revenue increases.

_June-July: House Speaker John Boehner, R-Ohio and Obama hold secret negotiations on a larger budget agreement that includes up to $800 billion in higher tax revenues. Boehner abandoned the talks on July 23, saying Obama wanted higher taxes and not enough spending cuts.

_August: With a crisis looming, Obama and lawmakers reach agreement to avoid a U.S. default. Congress passes and Obama signs the Budget Control Act, which set appropriations "caps" for 10 years, saving $900 billion, and created a deficit "supercommittee" charged with recommending at least $1.2 trillion more in deficit reduction. The law effectively lifted the debt ceiling from $14.3 trillion to $16.4 trillion and set appropriations caps of $1.043 trillion for 2012 and $1.047 trillion for 2013.

_Aug. 5: The Standard & Poor's ratings agency downgrades the U.S. government's AAA credit rating, citing "political brinkmanship" in the debt limit debate.

_September-November: The bipartisan, evenly divided supercommittee deliberates but fails to reach agreement, setting the stage for across-the-board spending cuts of more than $100 billion a year starting in January 2013.

_November-December 2011: In two separate pieces of legislation, Congress enacts the fiscal 2012 appropriations bills in accord with the debt pact.

___

2012

_March: House Republicans break with the debt pact when devising and passing their fiscal 2013 budget resolution. The GOP budget calls for cutting $19 billion below the debt accord and shifting an additional $8 billion from domestic programs to the Pentagon. The White House responds with a blanket veto threat against every spending bill.

_April: Most Republicans on the Senate Appropriations Committee, including GOP Leader Mitch McConnell of Kentucky, vote with panel Democrats to affirm the $1.047 trillion appropriations cap for 2013.

_April-August: The House passes seven of 12 appropriations bills; the Senate fails to take up a single one of the measures.

_July 31: Boehner and Senate Majority Leader Harry Reid, D-Nev., announce agreement on a six-month stopgap spending bill, with the details to be worked out during the August recess.

_Sept. 30: Budget year ends. Stopgap measure takes effect.

___

2013:

_Jan. 2: Unless Congress intervenes, $110 billion in automatic spending cuts, evenly divided between defense and domestic programs, take effect.


(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)