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Senate defeats Democratic alternative to automatic spending cuts

U.S. President Barack Obama and House Speaker John Boehner (R) attend the unveiling ceremony for the Rosa Parks statue in the U.S. Capitol i
U.S. President Barack Obama and House Speaker John Boehner (R) attend the unveiling ceremony for the Rosa Parks statue in the U.S. Capitol i

WASHINGTON (Reuters) - The Senate on Thursday rejected a Democratic plan backed by President Barack Obama for replacing $85 billion in across-the-board government spending cuts that are set to begin within hours.

As expected, the Senate defeated the proposal that would have substituted the indiscriminate budget cuts with tax increases on the rich and the elimination of some farm subsidies for large corporations.

Republicans have vowed to block any new tax increases as part of deficit-reduction efforts.

Earlier, the Senate also defeated a Republican proposal to replace the across-the-board spending cuts.

With the defeat of the Democratic and Republican plans, the $85 billion in cuts that will hit most federal agencies are expected to begin at the end of the month.

(Reporting By Richard Cowan)

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