Congress reaches deal to avert government shutdown

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Updated at 3 p.m. ET

(CBS News) Senate Majority Leader Harry Reid and House Speaker John Boehner on Tuesday afternoon announced they have reached a deal to keep funding federal operations past September 30 and avert a government shutdown.

"This agreement reached between the Senate, the House and the White House provides stability for the coming months, when we will have to resolve critical issues that directly affect middle class families," Reid said in a statement.

In the absence of a new budget agreement for the next fiscal year, the deal will extend spending for another six months after the 2012 fiscal year closes at the end of September. Leaders have agreed to cap spending levels at $1.047 trillion, as agreed to in the debt deal Congress reached last August.

Members of congress will work with their staff to write the legislation over their August recess, Boehner said in a statement, so that the House and Senate can pass it in September.

Reid said in his statement that he hopes Congress "can face the challenges ahead in the same spirit of compromise."

The deal, however, is likely to anger conservative Republicans who wanted to reduce spending further. The GOP-led House in March passed a budget calling for $1.028 trillion in discretionary spending in 2013.

While the deal averts the threat of a shutdown this year, it only temporarily resolves one of the legislative body's fiscal challenges. Lawmakers still have multiple issues they must address before the end of the calendar year, including whether to extend all or part of the Bush-era tax cuts that are set to expire this year.

Congress is also searching for a way to avoid "sequestration," the $1.2 trillion in spending cuts -- half coming from the Defense Department and half from domestic programs -- slated to go into effect in January. The cuts were enacted as part of the August debt deal, since the so-called congressional "supercommittee" that was formed to find budget savings failed to reach a deal.

[peace6348]

Don't post pone this boondoggle - let the public see what lengths the Repubs will stretch for to damage Obama no matter the harm it causes the USA.

[johnnny222]

In California we passed a law that states if our lazy politicans didnt pass a balanced budget you dont get paid Why is there nothing in place at a feederal level .It cost us more money with this temporary fix than balancing the budget. Every year Congress shows its incompentence to run things and continues to do a sloppy job with no accountability. This needs to stop Please Vote smart this november and end the stupidity in our Government

[expatriate2]

Do the world a favor. Shut it down permanently and let the people start over again.

[tsigili]

They all just won't sacrifice their vacation, over differences......plain and simple.

[forrestt56]

...Want the United States Economy to get better?
Vote the GOP obstructionists out of office and it will happen.
Yes, it's that simple.

[Jaylah54200]

I really didn't think the TeaPublicans were capable of learning anything, let alone learning from history.

But evidently they remembered having to admit that playing chicken with the national economy was a stupid move politically, and aren't willing to try to do it again.

[nearl451]

I sincerely hope that Boener let Cantor in on the deal, or the HOuse may not pass a damned thing. Cantor has undercut Mr. Boehner on just such an occasion previously.

[w_roos]

I heard Speaker Boner crying in one of the House chambers after the deal was announced. Couldn't tell if they were tears of joy or tears of sorrow.

[alanrobisch]

Gee what a shock a bipartisan agreement. Of course no credit will go by progressives to republicans. It may make them unpopular with their base and fellow posters.

[pogrebyshche]

Does anybody REALLY believe that the T-publicans will honor this agreement, any more than the previous ones? Isn't their only goal to see the government fail and do whatever it takes to try to keep Obama from being re-elected?

[alanrobisch]

Gee what are the dems goals? Is it to elect Romney?

[RollotheNorman]

We shall see. It's actually in the RepubliCONs best interest not to shut down the government on the eve of an election. They did it once and got hammered for it in the 90's, they came to the brink and got hammered for it in the last budget deal. Of course there are some really whacked morons Boehner has to deal with, but prolly even the T'bggrrr's have fallen in love with $174,000 + the best benefit package the US Government can buy them for 3-4 days work every other week and frequent month long vacations. Not to mention those fact finding junkets in tropical paradises.