* Wait-and-see approach to 2014 budget amid "fiscal cliff"
* Democrats say deficit deal functioned as budget
By David Lawder
WASHINGTON, Nov 15 (Reuters) - Democrat Patty Murray, who formally declared Thursday that she wants to chair the U.S. Senate Budget Committee and is virtually certain to get the job, may extend what is becoming a Senate tradition - not passing a formal budget next year.
The reason, she reckons, is that the high-stakes negotiations over the "fiscal cliff" of looming tax hikes and spending cuts may include a deal to set spending levels for fiscal 2014, her spokesman said.
The last big deficit reduction plan - the Budget Control Act that settled Congress' grinding battle over raising the debt limit last year - set a cap on fiscal 2012 and 2013 discretionary spending, which funds government agencies and programs ranging from defense to education.
"It's an open question" on whether the normal budget process will be necessary, said Murray spokesman Matt McAlvanah. "Senator Murray's point is that we'll have to wait and see over the next few months what compromise Congress can produce."
Republicans on both sides of the Capitol rarely miss an opportunity to criticize the Democratic-controlled Senate for failing to pass a budget resolution in each of the past three years.
The Republican-controlled House of Representatives in each of the past two years passed controversial budget plans authored by congressman Paul Ryan that made deep cuts to entitlement programs. These died in the Senate but helped elevate him to be chosen as Mitt Romney's running mate in this year's presidential campaign.
Republican Senator Jeff Sessions, the top Republican on the Senate Budget Committee, kept up the criticism of the Senate in his statement congratulating Murray on her decision to seek the chairmanship.
"The Senate majority shirked this legal duty for three straight years and it is unthinkable that it would go a fourth straight year without offering a proposal as the law requires," Sessions said. "The majority's refusal to do any budget work has brought us to the edge of a fiscal cliff and deepened the threat of a future debt crisis."
BUDGET IN LIEU
Democrats, including Murray, who has been the committee's second-ranking Democrat after retiring Chairman Kent Conrad, maintain that the Budget Control Act was indeed a budget and in some ways a more forceful one.
It did the same essential job as a formal, non-binding budget resolution by setting a hard cap for discretionary spending, $1.047 trillion for fiscal 2013. Congress never finished the job of passing spending bills written to that level but used it as a guide for a stop-gap government funding measure that lasts until March 27.
The expiration of that spending authority is among the many deadlines early next year that constitute the fiscal cliff. Should Congress fail to act before year-end, Bush-era and other tax cuts will expire and automatic spending cuts will kick in, sucking some $600 billion out of the U.S. economy, likely causing a new recession.
It was no surprise that Murray, a key member of the congressional "supercommittee" that failed to reach a deficit reduction deal last year, would seek the Budget Committee gavel.
Murray has been among the most vocal Democrats who have argued that going over the fiscal cliff - letting tax rates snap back to pre-2001 levels - would be better than accepting a budget deal that extends current tax rates on wealthy Americans.
Senate Democratic committee assignments are expected to be formally announced in the coming weeks. Her seniority on the committee makes it almost certain Murray will get the job.