The budget battle in Washington, D.C., continues as Republicans and Democrats are at odds over how much to cut from spending.
This week there were signs of progress as Vice President Joe Biden and Democratic Sen. Chuck Schumer both said a deal has been reached with members across the aisle on cutting an additional $33 billion. But that seemed to be in question Friday as U.S. House Speaker John Boehner, the Republican leader from Ohio, said those reports were false.
"Now, you've heard Democratic leaders claim an agreement has been reached on this issue, but let me be clear. There is no agreement. Republicans continue to fight for the largest spending cuts possible to help end Washington's job-crushing spending binge," Boehner said in the weekly GOP Address. (Click here for full text of Boehner's address.)
"To support job creation in America, we need to keep the cuts coming, and we need to do much, much more. That's why it's important for Congress to get moving and pass a final bill that resolves last year's budget mess while making real spending cuts — so we can tackle the bigger challenges facing job creation."
Boehner said there has been some 'early progress' made this year in his and other Republican members' efforts to cut spending, already slashing at least $51 billion from President Barack Obama's spending plan. However, he said the 'spending binge' the federal government has been on is holding back our economy.
"Washington's inability to get spending under control is creating uncertainty for our job creators. It's discouraging investment in small businesses, and eroding confidence in our economy. To put it simply, the spending binge in Washington is holding our country back and keeping our economy from creating jobs," he said in the address.
Members of Congress have approved two short-term spending resolutions to stave off a potential government shutdown until a budget agreement can be reached. There is a lot of pressure on both parties to avoid a government shutdown that would be costly to the U.S. economy.
Members of the Republican party also are under pressure from Tea Party movement supporters to not compromise with Democrats.
The government spending bill has a huge impact of the Dayton region as there are more than 25,000 military, civilian and contract employees at Wright-Patterson Air Force Base who rely on federal paychecks. Boehner has been working on a compromise that would balance Republican wishes with those plans in President Obama's proposed budget.
Among the big companies that are working on Defense contracts in the Dayton region include Boeing Co. (NYSE: BA), Northrop Grumman Corp. (NYSE: NOC), Lockheed Martin Corp. (NYSE: LMT), Booz Allen Hamilton (NYSE: BAH), BAE Systems and General Dynamics Corp. (NYSE: GD).
Any lengthy shutdown of the government could not only have an impact on those companies, but also put the breaks on an already-fragile economic recovery, which could hurt other businesses. Among those suffering already are manufacturers, which have been dealt a blow by the recent Japan tsunami and nuclear disaster caused by the massive earthquake there.
Automakers such as Honda Motor Co. (NYSE: HMC), Toyota Motor Corp. (NYSE: TM), General Motors (NYSE: GM) and Ford Motor Co. (NYSE: F), have been forced to stop or slow production at some plants. Those moves are expected by analysts to hit quarterly earnings and have a trickle-down impact on such large companies as AK Steel Holding (NYSE: AKS), which had more than $2 billion in direct sales to automakers last year.
The Japan situation also has hit Apple Inc. (Nasdaq: AAPL) with component shortages for its new iPad 2 mobile tablet.
It's unclear what a federal government shutdown would do to the banking sector, which routinely relies on the U.S. Treasury and Federal Reserve for short-term loans and other services.
The banking sector was hit hard during the recession, but has rebounded somewhat since then.
In terms of assets, Bank of America Corp. (NYSE: BAC) held $2.27 trillion in assets at the end of last year, while JPMorgan Chase & Co. (NYSE: JPM) had $2.12 trillion in assets at year-end, Citigroup Inc. (NYSE: C) had $1.91 trillion and Wells Fargo & Co. (NYSE: WFC) had $1.26 trillion. All of those banks have operations in the Dayton region.
In Dayton, Cincinnati-based Fifth Third Bancorp (Nasdaq: FITB) ranks as the largest bank in the Dayton market. PNC Financial Services Group Inc. (NYSE:PNC), JPMorgan Chase, First Financial Bancorp (Nasdaq: FFBC) and U.S. Bancorp (NYSE: USB) round out the top five largest banks in the local region.
KeyCorp (NYSE: KEY) and Huntington Bancshares Inc. (Nasdaq: HBAN) are just outside the top five.
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