Top Democrat: We Could Have Deficit Deal
Senator John Kerry said there could be a deficit reduction agreement if only Republicans agreed to raise taxes.
Members of the congressional “supercommittee” tasked with identifying more than a trillion dollars in deficit reduction took to the Sunday morning news shows to vent their differences as a deadline to reach compromise was periously close. According to Massachusetts senator John Kerry, the two sides could still reach a deal before Monday evening.
Kerry, a top Democrat, told NBC’s Meet the Press that Republicans had made “the calculation politically” to block a comprehensive deficit reduction effort “to wait until next year and just write their own deal.”
Republicans are expected to claim control of the Senate in next year’s general election after they won back their majority in the House of Representatives last November.
He also lamented that Republicans weren’t “living up to the sacrifice” and “the level of commitment” shown by American soldiers who gave their lives in Afghanistan and Iraq. Just how he could see himself striking a deal with members of the other party, Kerry didn’t say.
The supercommittee was created as part of August’s bipartisan agreement to raise the nation’s legal debt limit. It will run out of time to identify at least $1.2 trillion in cuts to ten year budget projections next week. If it doesn’t reach agreement beforehand, defense and domestic programs could each be subject to hundreds of billions of dollars in automatic spending reductions, a prospect that’s terrified military officials and defense hawks in Congress.
This process, referred to as sequestration, could be avoided in the next Congress however as the autopilot cuts aren’t set to come into effect until 2013.
Entitlement and tax reform are the two most complicated and divisive issues for the twelve members of the committee. The six Democrats are resistant to reining in public pensions and health support programs for seniors and the poor while the six Republicans oppose tax increases.
The “sticking divide,” said Senator Patty Murray, a Democrat from Washington, on CNN’s State of the Union was Republicans’ insistance that tax cuts enacted during the Bush Administration stay in place. According to Murray, “the wealthiest of Americans, those who earn over $1 million a year,” have to share in the sacrifice. “There’s that line in the sand and there aren’t any Republicans willing to cross it,” she said.
Senator Rand Paul, a Tea Party Republican, argued that the rich were paying more than their fair share already. “The top 1 percent, the millionaires in our country, pay on average 29 percent of their income” in taxes, he said. “The average carpenter who makes $50,000 to $75,000 a year pays between 15 percent and 18 percent.” He also pointed out that the top half of income earners is responsible for practically all income tax revenue.
Nevertheless, Republicans were willing to see revenue increase through tax reform, said Jon Kyl, a conservative senator of Arizona, on Meet the Press. “That was a big breakthrough for Republicans.”
Tax reform would have seen deductions eliminated and loopholes closed which disproportionately benefit the wealthiest of Americans. “In doing so you could both reduce some of the rates and have enough revenue to actually apply it to deficit reduction.” Some $250 billion, in fact, according to Kyl but Kerry disputed that number.
Democrats “weren’t going to do anything without raising taxes” however said Kyl who insisted that entitlement programs should be reined in to balance the budget in the long term.
Senator Kerry insisted that Democrats had been willing to consider “huge, hard, tough, horrible reductions” to entitlements. “We put it out there.” California congressman Xavier Becerra similarly pushed back against claims that Democrats weren’t willing to tackle popular entitlement programs in order to forge a deficit deal. “Every plan that Democrats have put forward has included cuts to entitlement programs,” he told Fox News Sunday.
The increase in eligibility has been on the table. And depending on what’s in the package, it might have be or something that could be something that’s in the package.
Medicare, which finances health care for seniors, and Social Security, America’s public pension program, are projected to deplete their trust funds in 2024 and 2036 respectively.
Republicans have proposed to privatize Medicare for the next generation of retirees while several of the party’s presidential contenders are in favor of introducing private retirement savings accounts for citizens who do not want to depend on a government pension. Both plans have been criticized by Democrats however who want seniors to be able to count on the “bedrock” promises of these decade-old programs.