Progress reported in spending deal talks

Negotiators working on six-month funding measure to avert a government shutdown on Saturday morning are reporting progress from talks on Tuesday night and Wednesday morning, according to people close to the negotiations. The movement appears to the result of willingness by Democrats to entertain total cuts approaching the $40 billion target floated by House Speaker Rep. John Boehner, R-Ohio, on Tuesday.

A Republican familiar with talks said negotiators are also nearing a compromise on the issue of policy riders and the breakdown of cuts in mandatory and discretionary spending in the bill. Republicans want to maintain $33 billion in cuts to discretionary spending in order to lower that baseline spending level moving forward. Appropriators on both sides of the aisle suggest that they will be ready to cut a deal once they receive a topline number of total cuts under which to work and guidance on what spending limitations to include.

House Republicans have pushed for inclusion of at least a few spending limitations, or riders, the House approved in February. Those include measures to block parts of the health care reform law; a provision to strip funding for Planned Parenthood; and another that would prohibit the Environmental Protection Agency from spending money to regulate greenhouse-gas emissions.

According both GOP and Democratic sources, it is possible to to have a bill ready for the House floor by Friday-- approching the shutdown deadline, but still leaving the opportunity for a deal.

Senate Commerce Appropriations Subcommittee Chairwoman Barbara Mikulski, D-Md., said on Wednesday morning that appropriators have agreed on a "framework" for dealing with the parts of the bill under her jurisdiction that will allow an agreement once an overall number for cuts is set.

"We're ready to go," Mikulski said.

She added that an overall deal will depend on the GOP showing flexibility, particularly on riders, but she did not rule out Democrats offering more than the $33 billion in total cuts they previously pushed as their topline number. Increased cuts could should come from mandatory spending, Mikulski said.

Determining a topline number is up to Boehner and Senate Majority Leader Harry Reid, D-Nev. It was not clear on Wednesday morning what number Reid would be willing to accept or what additional cuts his caucus would agree to.

Reid appeared to make a pitch for flexibility in a floor speech on Wednesday, saying that Democrats' only bottom line is "to avoid a shutdown."

"We want to pass a budget that makes smart cuts -- cuts that save money, but that don't cost jobs," Reid said. "This has been our bottom line throughout this process, so we've made tough choices. We've made those choices because we know that at this late stage of the game, reality is more important than ideology. We know that sacrifices are the cost of consensus, and we think they're worth it."