WASHINGTON (Reuters) – Democrats and Republicans did little to improve their battered image with Americans in a bitter budget debate that ended only with a last-minute deal that barely averted a government shutdown.

The political adversaries reached agreement to fund the government over the next six months little more than an hour before a midnight Friday deadline. The deal must still be voted on next week, after days of invective over spending and policy issues.

That was only round one. Now they have to launch into negotiations over the U.S. budget for fiscal 2012, and if the past few weeks have been any indication, it will be a difficult undertaking.

Welcome to divided government, 2011. Republicans won the House of Representatives in last November’s congressional elections, forcing President Barack Obama to take into account their views after he governed mostly with Democrats his first two years in office.

American voters are now seeing the results of the elections: Both parties battling over what they believe are the true concerns of the people. Republicans want deep cuts in spending, and Democrats want to protect programs for their constituents.

Who comes out ahead? The 1995 government shutdown was perceived to help the Democrats in a showdown between President Bill Clinton and then-House Speaker Newt Gingrich, a Republican.

This time, the top House Republican, Speaker John Boehner, survived his first major test, gaining $37.8 billion in spending cuts and averting a government shutdown that could have proven politically disastrous for Republicans in the 2012 presidential and congressional elections.

WASHINGTON, April 8 (Reuters) – With a midnight deadline approaching, the White House and U.S. Congress scrambled on Friday to break a budget impasse that threatens to shut down the government and idle thousands of federal workers.

Democratic and Republican congressional leaders blamed each other for the stalemate over government funding for the rest of the fiscal year, which ends Sept. 30, and could not even agree on what issues were the final stumbling blocks to a deal.

Democrats said the two sides were at odds over a Republican push to include birth control restrictions in the agreement, while Republicans said spending cuts were the issue.

Without an agreement on spending for the next six months, money to operate the government runs out at midnight on Friday (0400 GMT on Saturday) and agencies such as the Internal Revenue Service would begin a partial shutdown.

The White House said a shutdown would idle about 800,000 federal government workers and put a crimp in the U.S. economic recovery. Vital services such as defense, law enforcement, emergency medical care and air traffic control would continue.

Investment firm Goldman Sachs (GS.N: Quote, Profile, Research, Stock Buzz) estimated a government shutdown lasting more than a week could cost the economy $8 billion in missed federal spending, dragging down growth.

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WASHINGTON (Reuters) – Hard-nosed rivals with tough backgrounds, John Boehner and Harry Reid are locked in a bitter fight over spending cuts but aides say they have a good relationship that may offer the best hope of avoiding a government shutdown.

Boehner, the Republican Speaker of the House of Representatives, and Senate Majority Leader Harry Reid, a Democrat, have been negotiating on and off for weeks, and now face a Friday midnight deadline when funds will run out.

Reid says Democrats have met Republican demands more than half way by agreeing to about $33 billion in cuts this fiscal year to trim the hefty deficit.

But Boehner, under pressure from some House Republicans, is demanding more.

Failure to reach a deal would shut down large parts of the federal government, putting hundreds of thousands of people out of work, closing national parks and museums, and stalling mortgage and small business loans.

While the rhetoric between the two sides regularly flares up, the two central figures are keeping the talks going.

“One reason there are still negotiations is that Reid and Boehner can talk to each other,” a Republican aide said. “Unlike some members around here, they don’t hate each other.”

WASHINGTON (Reuters) – House of Representatives Speaker John Boehner Monday blasted Democratic spending-cut proposals as “smoke and mirrors,” undercutting the notion that progress is being made on a budget deal that would avert a government shutdown.

Boehner and other congressional leaders are due to meet with President Barack Obama Tuesday to try to make headway on the plan, which would slice roughly $33 billion from this year’s budget and ensure that the government will keep running beyond midnight Friday, when current funding runs out.

With time running short before government funding is due to run out Friday at midnight, aides said they thought a shutdown was unlikely. A spending bill must be worked out by Tuesday night in order to give Congress enough time to act before Friday.

“In the end there will be a deal because a shutdown doesn’t do anyone any good,” a senior Republican aide said.

A senior Republican aide said another short-term spending bill of a few days may be needed.

Congress is struggling to complete a long-overdue budget for the fiscal year that ends on September 30 in a dispute that could set a precedent for larger budget battles to come.

Staffers made progress over the weekend on the rough outlines of the plan, but the two sides remain at loggerheads over where the cuts would fall.

WASHINGTON (Reuters) – Supporters of the Tea Party fiscal conservative movement kept pressure on Republican leaders on Thursday not to bend in talks with Democrats over the biggest spending cuts in U.S. history.

“Grow a spine — no compromise,” read a sign held by Helene Kerns of West Virginia at a rally across the street from the Capitol. “That’s our message.”

Lawmakers have tentatively agreed to make $33 billion in spending cuts through September, but they now must delve into the details to decide which programs to cut.

Talks still have to deal with thorny issues such as a Republican plan to starve funding to implement President Barack Obama’s 2010 healthcare reform.

Tea Party activists, who helped to propel the Republican Party to power in the House of Representatives last year, called on Congress to make cuts of at least $100 billion.

“We don’t want symbolism just so Congress can pat itself on the back and say, ‘Oh, we’ve cut more than we’ve ever cut before,’” Jenny Beth Martin, a national coordinator of Tea Party Patriots, one of the movement’s biggest groups, told the rally attended by several hundred people.

House Speaker John Boehner has drawn fire from the Tea Party, with members saying he has not pushed for big enough cuts and warning they may challenge him in next year’s Republican primary.

WASHINGTON (Reuters) – Geraldine Ferraro, the Democratic congresswoman who became the first woman on a major party presidential ticket as Walter Mondale’s running mate in 1984, died on Saturday at the age of 75, her family said.

Ferraro died at Massachusetts General Hospital in Boston of a blood cancer after a 12-year illness, according to a statement from her family.

“Her courage and generosity of spirit throughout her life waging battles big and small, public and personal, will never be forgotten and will be sorely missed,” the statement said.

Ferraro was an energetic and articulate three-term congresswoman with a liberal reputation when Mondale picked her from the male-dominated U.S. House of Representatives. Ferraro’s presence on the Democratic ticket generated excitement on the campaign trail, particularly among women.

Yet on Election Day, Republican President Ronald Reagan and Vice President George Bush won in a landslide, carrying every state except Mondale’s home state of Minnesota.

In delivering her concession speech that night, Ferraro saluted Mondale for helping women reach new political heights.

“For two centuries, candidates have run for president. Not one from a major party ever asked a woman to be his running mate – until Walter Mondale,” she said. “Campaigns, even if you lose them, do serve a purpose. My candidacy has said the days of discrimination are numbered.”

WASHINGTON (Reuters) – Geraldine Ferraro, the Democratic congresswoman who became the first woman on a major party presidential ticket as Walter Mondale’s running mate in 1984, died on Saturday at the age of 75, her family said.

Ferraro died at Massachusetts General Hospital in Boston of a blood cancer after a 12-year illness, according to a statement from her family.

“Her courage and generosity of spirit throughout her life waging battles big and small, public and personal, will never be forgotten and will be sorely missed,” the statement said.

Ferraro was an energetic and articulate three-term congresswoman with a liberal reputation when Mondale picked her from the male-dominated U.S. House of Representatives. Ferraro’s presence on the Democratic ticket generated excitement on the campaign trail, particularly among women.

Yet on Election Day, Republican President Ronald Reagan and Vice President George Bush won in a landslide, carrying every state except Mondale’s home state of Minnesota.

In delivering her concession speech that night, Ferraro saluted Mondale for helping women reach new political heights.

“For two centuries, candidates have run for president. Not one from a major party ever asked a woman to be his running mate — until Walter Mondale,” she said. “Campaigns, even if you lose them, do serve a purpose. My candidacy has said the days of discrimination are numbered.”

WASHINGTON (Reuters) – Republicans and President Barack Obama’s Democrats, facing huge economic stakes, may soon reach a budget deal for this fiscal year after weeks of half measures to avert a government shutdown.

Worried about the fragile U.S. recovery and their own political well-being, members on both sides seem willing to resolve a gap between them on how much needs to be cut from federal spending this fiscal year to rein in the budget deficit.

“Chances of a deal seem reasonably good,” a senior congressional aide said, adding that talks may deepen when they move from staff level to the involvement of party leadership in the Senate and House of Representatives as early as next week.

The aide said at least some House Republicans may back off demands for deeper cuts this year after House Budget Committee Chairman Paul Ryan unveils plans next week for additional reductions in fiscal 2012.

“That’s the hope,” the aide said, asking not to be identified, citing the sensitivity of the talks.

The Congressional Budget Office projected the fiscal 2011 deficit will hit $1.48 trillion, a jump of nearly 40 percent over prior forecasts.

Boosted by election victories last November, Republicans have proposed $61 billion in cuts this fiscal year, which ends in September. Democrats have backed only $10 billion in cuts.

WASHINGTON (Reuters) – Republicans and President Barack Obama’s Democrats, facing huge economic stakes, may soon reach a budget deal for this fiscal year after weeks of half measures to avert a government shutdown.

Worried about the fragile U.S. recovery and their own political well-being, members on both sides seem willing to resolve a gap between them on how much needs to be cut from federal spending this fiscal year to rein in the budget deficit.

“Chances of a deal seem reasonably good,” a senior congressional aide said, adding that talks may deepen when they move from staff level to the involvement of party leadership in the Senate and House of Representatives as early as next week.

The aide added that at least some House Republicans may back off demands for deeper cuts this year after House Budget Committee Chairman Paul Ryan unveils plans next week for additional reductions in fiscal 2012.

“That’s the hope,” the aide said, asking not to be identified, citing the sensitivity of the talks.

Boosted by election victories last November, Republicans have proposed $61 billion in cuts this fiscal year, which ends in September. Democrats have backed only $10 billion in cuts.

House Speaker John Boehner has signaled to Democrats they need to step up and make some tough choices.