Backing for
Fiscal Panel’s Plan Grows
Published: December 3, 2010 - New York Times
WASHINGTON — President
Obama said he would consider adopting some of the recommendations in the
provocative debt-reduction plan from his fiscal commission, which wrapped up
work on Friday with more of a bipartisan accord than even its
members had expected.
Soon after the commission finished — with 11 of its 18 members backing the
package of deep spending cuts and revenue increases — Mr. Obama issued a
statement praising the panel’s work. Without embracing any particular ideas, he
said he would review them all as he looks for ways to “correct our fiscal
course.”
“The commission’s majority report includes a number of specific proposals
that I — along with my economic team — will study closely in the coming weeks as
we develop our budget and our priorities for the coming year,” Mr. Obama said in
a statement distributed by the White House as the president visited troops in
Afghanistan.
The plan is an attempt to shave $4 trillion from projected deficits over the
coming decade. It reflects the view that chronic deficits and mounting debt,
driven by fast-rising health care costs and an aging population, must be
addressed aggressively even as the economy requires government help to recover
from a deep recession.
The package would make deep cuts — most of them starting in 2012, given the
economy’s fragility — in both domestic and military spending. It would overhaul
the tax code, eliminating or reducing the $1 trillion a year in popular tax
breaks for individuals and corporations. The resulting revenues would be used
mostly to slash income tax rates, but also to reduce deficits.
To ensure the solvency of Social
Security for 75 years, it would raise payroll taxes for the affluent and
reduce future benefits, including by slowly raising the retirement age for full
benefits to 69 from 67 by 2075.
With the administration at work on Mr. Obama’s State
of the Union address and the release of his annual budget in late January,
officials had said privately that there was interest in borrowing the
commission’s calls for overhauling the tax code and fixing Social Security — if
the panel could show the way to a bipartisan agreement. But the administration
is far from such decisions as it weighs how to proceed now that Congressional
Republicans have won control of the House and picked up seats in the Senate,
beginning next month.
Several Republicans welcomed the commission’s plan, but were vague about the
specific elements they might seek to turn into policy. Senator Michael D. Crapo
of Idaho, a member of the commission who supported the plan, called for
“immediate and aggressive action.” And the Senate minority leader, Mitch
McConnell of Kentucky, issued a statement saying, “It is my hope that this
effort will serve as a catalyst for achieving the spending and entitlement
reform that our country so desperately needs.”
But in a sign of where the political opposition might be most intense, the
plan was rejected by the three House Republicans on the panel, all of whom will
hold key positions in the new Congress.
Their position exposed a break with Senate Republicans, all three of whom on
the commission supported the blueprint. That split in part reflects the
different roles the Republicans will have in the House and Senate. While
Republicans have picked up seats in the Senate, they remain in the minority
there. House Republicans, having won a majority after campaigning as a
conservative alternative to the Obama administration, say they are obligated to
fulfill their vision rather than compromise. They also face pressure from the Tea
Party movement, which has made slashing government spending the centerpiece
of its agenda.
The commission did not formally vote because support for the plan written by
the co-chairmen — Erskine
B. Bowles, the president of the University
of North Carolina system and a former chief of staff to President Bill
Clinton, and Alan
K. Simpson, a former Republican Senate leader from Wyoming — fell three
votes short of the 14-vote supermajority required to send the package to
Congress under the terms of Mr. Obama’s executive order that established the
panel.
The 11 supporters were evenly split between the parties — five Democrats and
five Republicans, along with an independent, Ann M. Fudge, the former chief
executive of Young & Rubicam.
Despite that bipartisan majority, the outcome at best sent ambiguous signals
about whether the White House and Congress could reach an agreement, given the
political pain behind the tax and spending decisions that are required.
Several supporters said that although they backed the thrust of the plan,
they would not vote for it as actual legislation given their opposition to
various provisions. One such supporter was Senator Richard
J. Durbin of Illinois, the second-ranking Senate Democrat and Mr. Obama’s
closest Senate ally. He said the package was not balanced between spending cuts
and tax increases and it took “too much away from programs that support the
neediest.”
Yet even the plan’s opponents said it should serve as “a template,” in the
words of Representative Xavier
Becerra, a Democrat from California.
Another opponent on the panel, Andy
Stern, the former president of the Service
Employees International Union, said, “This plan deserves a vote, and this
president needs to make sure that by the State of the Union he also has his own
plan and his own leadership because this is the issue of our time that must be
solved.”
While the committee’s deliberations underscored the deep divisions over how
to address the nation’s fiscal imbalances, they also suggested opportunities for
agreement between Democrats who generally oppose reductions in domestic
spending, especially for Social Security and Medicare,
and Republicans who oppose tax increases.
Members of both parties, for example, hailed the proposed tax overhaul
because it would simplify the code, rid it of costly and confusing tax breaks
and allow for lower rates. Republicans as well as Democrats supported cuts from
military programs. And some Democrats endorsed the Social Security changes, with
Mr. Durbin acknowledging that he had shocked his liberal allies by endorsing a
slow increase in the retirement age for full benefits.
While the package will not get a vote in Congress, groups from the left and
right and from business and labor mobilized as a precaution in opposition. And
there were signs that the panel’s work had encouraged lawmakers who favored
tough steps to reduce deficits. Fourteen moderate Senate Democrats, led by
Senator Mark
Warner of Virginia, wrote to Congressional leaders on Friday urging
comprehensive action on a similar package.
Senator Kent
Conrad of North Dakota, the chairman of the Senate Budget Committee and a
commission member who supported the plan, said, “I never thought there was much
prospect of getting 14 votes” to meet the threshold for a vote in Congress. But
even with 11 votes, he added, “We have provided, I believe, a strong message to
our colleagues and to the country of what has to be done.”