Ryan: No 'grand bargain' U.S. deficit deal

WASHINGTON, May 8 (UPI) -- A long-sought bipartisan "grand bargain" U.S. deficit-reduction deal will not happen this summer, House Budget Committee Chairman Paul Ryan said.

Republicans and Democrats are too far apart, especially on overhauling Medicare and Medicaid, the Wisconsin Republican told a Washington conference sponsored by the Peter G. Peterson Foundation think tank that advocates fiscal soundness.

"A grand bargain implies you're going to fix the problem," Ryan said. "But when you have the majority party in Washington unwilling to embrace the kinds of reforms that make Medicare solvent or make Social Security solvent ... I don't see a grand bargain happening.

"The question is: Can we make divided government work and can we make a down payment on the problem? Can we buy the country time and fiscal space?" Ryan said. "That's what we're shooting for -- something that's realistic."

Ryan said after successfully goading the Democratic-controlled Senate into adopting its own budget plan, he would not meet with senators for a conference committee to bridge their two budget proposals. He said meeting now risked hardening both sides' respective positions.

"If we have a months-long stalemate in conference, people dig in and it makes it harder to reach a compromise," he told the conference.

But Ryan told The Washington Post his reluctance to open negotiations actually had to do with bargaining power.

He said with revenue up and spending down due to an improving economy, January tax hikes and across-the-board budget cuts known as the sequester, GOP lawmakers were in a weaker bargaining position than they were before.

The federal debt limit, a strong GOP bargaining chip, was originally projected to be reached sometime in July. But it now looks like it won't be reached until Oct. 1, independent forecasts indicate.

"The debt limit is the backstop," Ryan told the newspaper before taking the stage at the conference.

The debt limit, or debt ceiling, is a legislative restriction on the amount of national debt the U.S. Treasury can issue.

"I'd like to go through regular order and get something done sooner rather than later," Ryan told the Post.

"But we need to get a down payment on the debt. We need entitlement reform," he said, adding he also wanted tax reform.

As a result, the fiscal fight now appears likely to take place in September, the Post said.

At that time, Washington will face a double-barreled risk of default and a government shutdown, the newspaper said.

Democrats say they have asked Republicans to return to the table well before the next deadline.

"The American people -- all of us -- are tired of management by crisis," Senate Budget Committee Chairman Patty Murray, D-Wash., said at the Peterson summit. "We need to start working now in conference committee."

Murray acknowledged the competing House and Senate budget proposals were "fairly far apart."

"The Ryan budget proposes vouchers for Medicare and that is not going to happen. It is a non-starter," she said.