Automatic federal budget cuts of $85 billion looked certain to kick in Friday after a pair of bills to replace them failed in the Senate on Thursday.
Neither a Democratic nor a Republican bill aimed at replacing the so-called sequester was able to get enough support to win a test vote on Thursday.
While senators from both parties hadn’t expected passage, the bills represented a last-ditch legislative effort to replace the across-the-board cuts to domestic and military spending.
The Republican bill, which would have given President Barack Obama the opportunity to pick which cuts he’d make, garnered just 38 “yes” votes; the Democratic bill, which would have replaced the cuts with alternative spending cuts and tax hikes on the wealthy, received 51 “yes” votes; 60 were needed to cut off debate.
U.S. markets on Thursday shrugged off the budget drama in Washington, even as the White House and economists warned about the effects of the cuts. The Dow Jones Industrial Average DJIA -0.15% lost 21 points, after coming within striking distance of its all-time closing high set in October 2007. See Market Snapshot.
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