New US fiscal timeline after debt limit extension

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New US fiscal timeline after debt limit extension. (Reuters) New US fiscal timeline after debt limit extension. (Reuters)
SummaryThe legislation rearranges a set of springtime fiscal deadlines.

The US House of Representatives has passed a Republican plan to allow the federal government to keep borrowing money through mid-May. The legislation rearranges a set of springtime fiscal deadlines - and the budget battles that will accompany them.

Assuming passage by the Senate, which is expected, the measure would shift the immediate focus of spending-cut demands to other deadlines in March, April and May. Following is a rundown of the key dates in the reordered fiscal calendar and their implications:

* LATE FEBRUARY/EARLY MARCH - The Obama administration unveils its budget request for the 2014 fiscal year that starts on Oct. 1. As always, this is largely a messaging document that lays out the White House's fiscal priorities, while Congress makes the final decisions on actual spending legislation.

The budget is expected to be previewed in President Barack Obama's Feb. 12 State of the Union Address and is likely to reflect his recent pledges to protect the social safety net for older and poorer Americans while winding down the war in Afghanistan. It will be Obama's first major shot in the budget battles to come, and a key red flag for Republicans will be the extent to which he seeks additional revenues by eliminating tax credits and deductions.

* MARCH 1 - The new date for automatic spending cuts to take effect. Known as the sequester, these cuts were delayed two months by the New Year fiscal cliff deal, which raised taxes on the wealthy. The cuts now total about $85 billion for the remainder of fiscal 2013, which ends on Sept. 30, but would still be around $1.2 trillion over 10 years if not replaced.

Because these across-the-board cuts are evenly split between military and domestic programs other than health and retirement benefits, there is pain for both parties. House Republicans have tried to shift the military cuts to domestic spending, but Senate Democrats have rejected this. Lawmakers have voiced pessimism about prospects for a deal to avoid the cuts, but it would not be catastrophic for markets if they went into effect. The fiscal drag, however, would slow US economic growth.

* MARCH

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