Super Committee Lowers Expectations as Deadline Nears
There's a subtle divide between what Super Committee members are saying publicly and what's going on behind closed doors as the deadline looms to trim the deficit by $1.2 trillion in the next nine days.
There's a subtle divide between what some Super Committee members are saying publicly and what's going on behind closed doors as the deadline looms to trim the federal deficit by $1.2 trillion in the next nine days. In rare television appearances, Super Committee Republicans Jeb Hensarling and Patrick Toomey spoke on CNN's State of the Union and Fox News Sunday respectively, telegraphing serious doubts on the likelihood of an agreement and opening the door to deferring powers away from the committee or even scrapping the trigger designed to automatically-impose budget cuts. All the while, various reports from inside the Super Committee show some broad outlines of a deal between Democrats and Republicans emerging, though still far from certain.
Jeb Hensarling On CNN's State of the Union, Hensarling told host Candy Crowley the committee is considering deferring away some of its toughest decisions about how much new revenue to raise to the tax-writing committees of Congress to decide next year. “There could be a two-step process that would hopefully give us pro-growth tax reform,” said the Texas Republican. As The New York Times notes, "That would put off painful political decisions but ensure that the debate over deficit reduction stretched into the election year."
Pat Toomey Meanwhile, on Fox New Sunday, Toomey warned that the Congress should consider re-figuring how the $1.2 trillion in across-the-board tax cuts could be scrapped if the Super Committee fails, given that some say they would do serious harm to the military. "In the very, very unfortunate event that we don’t [make a deal] I think it’s very likely that Congress would reconsider the configuration.”
But are Democrats and Republicans really so far apart? It's true that they remain gridlocked about the ratio of tax increases to spending cuts. However, as The New York Times and Washington Post report, the two sides have made major inroads in recent days on the outlines of a deal. As the Times reports, a Republican proposal to raise $300 billion in tax revenue over 10 years "led to some optimism that the committee might at least come up with a partial deal that could reduce the amount of automatic cuts." It was even described by No. 2 Senate Democrat Richard Durbin as a "breakthrough." At the same time, the No. 2 Senate Republican Jon Kyl said the proposal was a "big step, a really big step." The Post puts the number differences in clear terms:
Mathematically, the gap between the two sides on the supercommittee has narrowed. Republicans have offered a $1.2 trillion deficit-reduction package that would cut spending by about $750 billion over the next decade while raising about $500 billion in revenue, including about $300 billion in new taxes. Democrats have offered to trim borrowing by $2 trillion, with that sum equally divided between spending cuts and tax increases.
Still, there are a number of Democrats and Republicans outside of the committee who oppose such a deal. Politico highlights the main sticking points that remain:
Republicans have moved off their insistence that the federal government does not need additional revenue, offering $600 billion in fresh revenue for the Treasury. The GOP, though, also wants the top income tax rate cut from 35 percent to 28 percent, while lowering corporate tax rates. Republicans have privately said they are flexible on the top-rate number.
Democrats, for their part, are insisting on far more new revenues in return for supporting the GOP’s tax reforms. Democratic proposals floated within the supercommittee — but not supported by all six Democratic participants — have oscillated between $1 trillion and $1.3 trillion in new revenues.
Can the two sides breach the gap? As the Nov. 23 deadline looms, we'll find out soon enough.