Even before the package to raise the debt limit was approved by Congress, Republicans and Democrats were arguing about the contours of its deficit-reduction committee.
Republicans have insisted that the 12-member panel, made up of three members of each party from both the House and Senate, will not have room to raise taxes as a way of meeting its goal of finding at least $1.2 trillion in deficit reduction. They also promise that the committee will begin to address entitlements.
Yet on the opposite side, Democrats have renewed calls for a “balanced approach” and “shared sacrifice” — PR euphemisms for raising taxes.
It’s an ominous sign that, even before the legislation creating the committee actually became law, the parties were already sending out dueling press releases about what it could and could not do.
If Republicans were smart, they would take Democrats at their word. But instead, they have been publicly in denial about the obvious risks of this committee.
The key problem lies with the enforcement mechanisms, or “triggers,” created to compel the committee members to reach an agreement. While Republicans wouldn’t agree to a tax-hike trigger, they did agree to one that would slash defense spending by up to $600 billion, depending on how far short the committee falls of the deficit-reduction goal. This puts anti-tax Republicans who favor a robust military in a bind.
Democrats on the committee could insist on raising taxes, and Republicans will either have to give in to the tax demands, or accept deep defense cuts.
When I posed this clear dilemma to House Majority Leader Eric Cantor, R-Va., as he was leaving the Capitol after Monday’s vote to raise the debt limit, he was dismissive.
“I think we have a construct here that would force the body and force Congress to implement the savings and cuts that are necessary so that we can continue trying to get the fiscal house in order,” he said.
Longtime defense hawk Sen. John McCain, R-Ariz., told me that, while he had concerns about the possibility of defense cuts, he was confident that the committee would reach a compromise that would prevent the trigger from being pulled. If there were a threat of deep defense cuts, he said, he’d fight them strongly at the time. Yet the way the legislation is written, the House and Senate are to vote on the committee proposal by Dec. 23, and if the recommendations aren’t adopted, it would trigger the cuts.
Republicans argue that the baseline the committee will be using to measure its deficit reduction would preclude repealing the Bush tax cuts. However, that still allows Democrats to propose a net tax increase by closing all sorts of loopholes without offsetting them with tax cuts elsewhere.
Another GOP talking point is that the inclusion of an equal trigger for Medicare will force Democrats to compromise. Yet the trigger exempts Social Security and Medicaid, as well as Medicare benefits.
The triggered cuts would be onproviders such as hospitals and pharmaceutical companies, which aren’t as objectionable to liberals. In fact, Obamacare made such cuts, and a budget proposal released by House liberals called for saving money in Medicare by bargaining down drug prices.
Republicans may very well have gotten the best deal they could have in debt-limit negotiations with President Barack Obama and Senate Democrats. But they should be under no illusions about the dangers of the latest Washington committee.
Philip Klein is a senior editorial writer for The Washington Examiner.