What Happens If the Supercommittee Fails?

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Under this summer's debt-limit compromise, $1.2 trillion will automatically be cut if the panel does not act. Can Congress circumvent that requirement?

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House and Senate lawmakers would likely rethink allowing some budget cuts to be triggered automatically if the so-called deficit "supercommittee" fails to come up with at least $1.2 trillion in savings, or if Congress fails approve such a plan by Dec. 23, a member of the panel predicted on Sunday.

Appearing on "Fox News Sunday," Sen. Pat Toomey (R-Pa.) insisted he is not giving up on the chances that the Joint Select Committee on Deficit Reduction can make its Nov. 23 deadline for agreement on a plan to give to the rest of Congress to consider. That hopeful sentiment was echoed by the committee's co-chairman, Rep. Jeb Hensarling (R-Texas.), speaking Sunday on CNN's "State of the Union"--although his panel's deadline is just 10 days away.

But Toomey said that if agreement is not reached on how to cut at least $1.2 trillion from the nation's deficit over the next decade, "I think a lively debate will occur" over whether to allow the automatic cuts take place--so-called sequestration--despite President Obama's insistence on Friday he would not go along with any attempt to turn them off.

Toomey said that "in the very very unfortunate event that we don't, I think it's very likely that Congress would reconsider the configuration of that sequestration, and consider is this really the best way to do it?" Toomey said.

He added that the debate likely would be about the "nature of those cuts--which I think the cuts have to occur, but they might occur in a different fashion."

Toomey's comments come amid growing speculation that Congress could change the breakdown of the $1.2 trillion in cuts that would automatically kick in if the panel and lawmakers fail to reach a deal--half of which would come from the Pentagon and the other half from domestic programs. Republicans, in particular, have complained that such automatic cuts would be particularly harmful to the military.

To counter such talk, the White House put out a statement Friday underscoring its position that sequestration was put in place to help force a deal to slash the debt, and should not be reconsidered.

Members of the committee acknowledge that as of this weekend, they were not close to bipartisan agreement--in disputes over levels of cuts to entitlements and defining and proposing new revenues, including tax increases. But they also insist that they are continuing to work to reach a deal.

Hensarling, during his appearance on "State of the Union," reiterated that for the supercommittee to succeed, lawmakers will have to agree on structural reforms to entitlement programs and tax reform.

Hensarling zeroed in on entitlement spending arguing that Medicaid and Medicare are "disserving their beneficiaries with forms of rationing and driving the country bankrupt." "Republicans put forth a plan in our House budget," he said, referring to the so-called Ryan Plan contained in House Budget Committee Chairman Rep. Paul Ryan's budget. Hensarling also said that Republicans would be "willing to negotiate around" the so-called Rivlin-Domenici budget plan put forth by former Democratic White House budget director Alice Rivlin and former Republican Senate Budget Committee chairman Pete Domenici. "This is a plan, bi-partisan plan ... that would also include a provision for future seniors to stay in tradtiioanl fee-for-service Medicare but use the power of patient choice and competition to save and strenghthen the program," Hensarling said.

On revenues, Hensarling suggested that Republicans would be willing to support $250 million in tax increases--which he characterized as closing loopholes--in exchange for tax reform.

"Whatever damage would be done by $250 billion of new taxes we think would be offset by a system that would help create jobs," he said.

But during an appearance on "Fox News Sunday," another panel member, Rep. James Clyburn (D-S.C.), took a swipe at the so-called "dynamic scoring" that some Republican members of the deficit reduction committee reportedly are considering as a way to estimate how changes in tax policy might generate changes in the economy.

"We've got to come up with a plan that [the non-partisan Congressional Budget Office] will score," said Clyburn, as opposed, he said, to "dynamic growth." Clyburn said, "Let's take this down to actual numbers, tax cuts, tax increases, entitlement cuts and entitlement increases."

But Clyburn also acknowledged that even the six Democrats on the committee aren't in agreement with each other.

"The fact of the matter is democrats have not coalesced around a plan," admitted Clyburn. But he also said, "Republicans don't have a [singular] plan."

"I think we are there to develop a bipartisan plan," he said.

"It's been a roller coaster ride. I will say this: I respect my Democrat colleagues. ... We haven't given up hope," said Hensarling during his CNN appearance.

Meanwhile, one member of the Senate's so-called bipartisan Gang of Six argued on Sunday that if the deficit supercommittee fails, then Congress should turn to proposals put forward over the summer by the group that call for nearly $4 trillion in cuts over 10 years.

"We've tried this congressional process. I think we need to let that play itself out. We want to be there to support it. We want that supercommittee to be successful, but if they're not successful we think that the Simpson-Bowles approach or the Gang of Six something that has got that $4 trillion number. That ought to at least get a vote as well," Sen. Mark Warner (D-Va.) said "State of the Union."

The Gang of Six, which includes Senate Minority Leader Dick Durbin (D-Ill.), Senate Budget Committee Chairman Kent Conrad (D-N.D.), and Sens. Warner, Mike Crapo (R-Idaho), Saxby Chambliss (R-Ga.), and Tom Coburn (R-Okla.) issued the outlines of a plan, based on the Simpson-Bowles report, that called for $3.7 trillion in deficit reduction over 10 years. The plan failed to reach the critical threshold of 60 votes in the Senate. Coburn, also appearing on the program Sunday morning, said he sees failure in the order of what happened in Greece if Congress and the president cannot reach agreement on the deficit.

"Then fact is if you go back and look at two years ago at what they were writing about Greece. it's exactly what they're writing about us today," Coburn said.

Image credit: Mark Theiler/Reuters

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Billy House & Michael Catalini

Billy House is a Congress writer for National Journal. Michael Catalini is an online editor at National Journal.

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