Republican leaders in the House of Representatives want to make deep spending cuts of $4 billion as part of a stopgap bill to avert a government shutdown, a senior aide said on Wednesday.
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The two parties need to agree on a spending bill next week or much of the federal government will close, unsettling financial markets and risking massive layoffs.
A House Republican aide told Reuters the party was proposing a two-week extension of government funding beyond March 4.
"Two weeks and roughly $4 billion (in spending cuts) would be reasonable to expect," a House Republican aide told Reuters.
But the size of the proposed cuts worried Democrats, who control the Senate and can block the Republican plan.
Jon Summers, a spokesman for Senate Democratic Leader Harry Reid, dismissed the proposal as "reckless," and accused Republicans of refusing to compromise.
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President Barack Obama's Democrats are fighting a pitched battle over spending cuts with Republicans, who were energized by big wins in November elections after campaigning for smaller government to curb a massive U.S. budget deficit.
Global investment firm Goldman Sachs has estimated that the deep cuts in the House-passed bill would significantly slow U.S. economic growth in the second and third quarters of this year.
A $2 billion cut in spending over two weeks would trim the government at about the same rate that House Republicans won in a spending bill their chamber approved last week. That measure, declared dead in the Senate by Democrats, would slash spending by $61 billion through September 30.
House Republican leaders aim to get their chamber to approve their new, temporary spending-cut proposal next week and send it to the Democratic-led Senate.
Both houses of Congress are in recess through this week so there will be little time for Democrats and Republicans to work out a deal on spending and avoid a government shutdown before current funding expires on March 4.
WORK IT OUT
One Democratic aide said the House Republican approach will never get the 60 votes needed for passage and that Reid and Senate Republican leader Mitch McConnell will end up working out a deal to keep the government running.
"At the end of the day, they always find a way to work things out," the aide said.
Reid and other Senate Democratic leaders have said there needs to be cuts this year, but accuse Republicans of cutting too deeply, jeopardizing the fragile U.S. economy.
A Republican aide said specific spending reductions were still being worked out for the House bill. "They are trying to figure out what cuts would be benign enough to be amenable to all," the aide said.
"I'm not sure what would satisfy Democrats. (But) our members wouldn't accept (a short-term bill) at current spending levels," the aide said.