How the budget deal could sink — or make — the tea party’s No. 1 accomplishment

UPDATE: Rep. Paul Ryan and Sen. Patty Murray unveiled a budget proposal Tuesday night. The proposal, which has yet to be voted on, busts through sequester caps, setting FY 2014 spending at $1.014 trillion — billions beyond the levels mandated by sequester. The proposal contains no mention of pension reform.

Conservatives had better start paying attention to the budget battle raging in Washington: If things go south — and they are poised to do just that — the tea party’s single greatest policy victory, the sequester, could be destroyed. And worse yet, it could be destroyed in exchange for nothing.

The sequester isn’t popular with Republican defense hawks. President Barack Obama counted on that when he threw it out as an offer he believed the GOP would never take. But the president miscalculated the strength of tea party momentum, and he ended up signing into law the only year-to-year decrease in discretionary spending in modern U.S. history.

This week, Republican Rep. Paul Ryan and Democratic Sen. Patty Murray are leading their parties’ negotiations for a spending deal, without which the government will shut down on Jan. 15, 2014. Reports coming out of the secret meetings, however, indicate that the sides may agree to spending levels that are billions of dollars above the $967 billion-level mandated by the sequester law, potentially scuttling the tea party’s victory and surrendering the Republican’s advantage. (VIDEO: Scarborough on new budget deal: ‘Conservatives are getting ready to get rolled’)

“The sequester is the only place where conservatives have gotten a victory,” Americans for Prosperity spokeswoman Nicole Kaebing told The Daily Caller. “It’s the one place where we have gotten both parties and the president to agree to actually cut spending. It’s silly to walk that back. We have this victory, and Republicans should not be voting to increase government spending.”

Americans for Tax Reform president Grover Norquist agrees — to a point: “Holding the sequester for 10 years is the important thing to do — that’s the win,” Norquist told TheDC. “If we hold the sequester, we never get back into the grand bargain of the Democrats: That’s 10 years to get Republicans back into White House, Senate, then you pass the Ryan budget bill … pay down the national debt — that’s winning.”

So why is sequester being discussed as a bargaining chip at all? For long-term non-discretionary cuts, Norquist explained. Sequester works by cutting gradually into discretionary spending, with the most dramatic cuts in the first two years. Democrats say they want the first two years of cuts to conform more closely with the later, gradual cuts, and that is where Norquist said there is wiggle room.