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Budget cuts back in spotlight as flight delays mount

By Mark Felsenthal and Alwyn Scott

WASHINGTON/NEW YORK (Reuters) - The Obama administration on Wednesday backed a plan that would temporarily eliminate spending cuts disrupting U.S. air travel, while lawmakers in Washington scrambled to avoid blame as the impact of the reductions began being felt across the country.

Airlines pushed for the government to act as flight delays increased and planes stacked up at airports, with one chief executive saying, "We can't do this for long."

With Republicans and conservative commentators blaming President Barack Obama for using the across-the-board spending cuts known as sequestration to score political points, the White House said it supported Senate Majority Leader Harry Reid's proposal to replace the reductions by claiming savings from the drawdown of war spending.

"We support this effort to allow both sides to find a longer-term solution that replaces the sequester permanently in a balanced way so we can stop these harmful cuts that are hurting our economy and middle-class families across the country," White House spokesman Jay Carney told a briefing.

The administration would support the move as a temporary measure even though it does not raise revenues, Carney said.

Congressional Republicans have rejected the proposal, saying counting war savings is an accounting gimmick, but complaints about the air traffic delays have thrust sequestration back into the spotlight.

EFFECTS ADDING UP

Thousands of flights have been held on the ground, some for as long as two hours, since the Federal Aviation Administration began furloughing air-traffic controllers on Sunday. The intermittent delays have slowed travel at major hubs like Chicago, New York, Los Angeles and Atlanta, caused flight cancellations and stirred concern a chunk of the nation's economy could suffer if the situation persists or worsens.

For business travelers and tourists, the slowdown means missed connections and meetings. Private planes used by businesses are waiting while controllers first guide commercial flights into hubs, and they are carrying more fuel as a safety precaution, in case they are held in the air.

US Airways, Delta Air Lines, American Airlines and Southwest Airlines have warned that furloughs could cost hundreds of millions of dollars a year in lost revenue. The airline industry says it helps generate more than $1 trillion in economic activity in the United States annually and supports 10 million jobs.

"We can't do this for long without having major disruption to the flying public," US Airways CEO Doug Parker said in an interview. He said he called government officials at the airline's hubs last week, and that Congress and the Obama administration were trying to limit the damage.

The requirements have put pressure on FAA chief Michael Huerta, who was questioned in congressional hearings in the past two weeks about furloughs and the closures of smaller towers.

Huerta says the cuts are the only way to trim the agency's budget, and he said on Wednesday that flight delays had not been as bad as feared.

But industry critics said the FAA had not been forthcoming with information. "We didn't get a detailed briefing until Tuesday - a week ago Tuesday," said Jean Medina, a spokeswoman for the trade organization Airlines for America, or A4A.

Last Friday, A4A sought to block the furloughs in court, and the Air Line Pilots Association joined the A4A in launching a website that directs visitors to email or call congressional members on the issue. The ALPA represents nearly 53,000 pilots at airlines in the United States and Canada.

More than 12,000 people have used it to voice concerns since it went live on Friday. A map showing congressional districts shows large pockets of opposition in Chicago, the Northeast and California. Most of those posting comments oppose furloughs.

CONGRESS LASHES OUT

"These cuts simply punish everyone rather than specifically target the great number of outdated, wasteful and duplicative functions being funded with our taxpayer dollars," Iowa Republican Tom Latham said. "In short, arbitrary, non-targeted, across-the-board cuts are no way to run a government."

Members of Congress are offering a measure that would allow the FAA to transfer funds between accounts to minimize disruptions to air travel.

The sequestration cuts are the legacy of Republican efforts to pressure the Obama administration into spending cuts in exchange for raising the nation's debt limit. The White House and lawmakers agreed to hold up the threat of the reductions, which affect defense and non-defense spending equally, as incentive to reach a broader deficit-reduction deal.

When that deal never materialized, the cuts took effect on March 1. Although the administration broadly advertised the negative impact they would have, those effects were not evident right away.

Flight delays this week have revived the issue. Carney blamed Republicans on Wednesday for underestimating the negative impact of the spending reductions.

"Republicans in Congress made a political tactical decision to embrace the sequester," he said. Cuts proposed by House Budget Committee Chairman Paul Ryan would bite even more deeply than those under the sequester, he added.

But some Republican conservatives expressed support for the sequestration cuts on Wednesday, saying that they were long overdue.

"I don't understand this fascination with the Democrats right now with the sequester, and frankly some Republicans as well," Republican Representative Raul Labrador said.

(Additional reporting by Karen Jacobs in Scottsdale, Arizona; Editing by Ben Berkowitz, Mary Milliken and Peter Cooney)

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