Budget Talks Open: Sequestration Likely to Go, Entitlement Reform Faces Uphill Climb
Ryan: "If this conference becomes an argument about taxes, we’re not going to get anywhere. The way to raise revenue is to grow the economy.”
October 31, 2013 - 4:51 pm
WASHINGTON – Lawmakers opened negotiations over a long-term federal spending and tax plan this week by staking out positions that will make it difficult to reach the sort of compromise necessary to avoid another governmental shutdown.
Rep. Paul Ryan (R-Wis.), chairman of the House Budget Committee, argued during the opening round of talks that the cost of entitlement programs like Medicare and Medicaid needs to be reined in by a method other than increasing taxes.
“Taking more from hardworking families just isn’t the answer,” Ryan told members of the specially appointed conference committee charged with straightening out the nation’s budgetary issues. “I know my Republican colleagues feel the same way. So I want to say this from the get-go — if this conference becomes an argument about taxes, we’re not going to get anywhere. The way to raise revenue is to grow the economy.”
But Democrats expressed an immediate unwillingness to remove a tax increase from the table. And Sen. Bernie Sanders (I-Vt.) countered that it would be unthinkable to reduce spending on the backs of the poor and elderly who need entitlement assistance.
Sanders cited polls that show a significant majority of Americans oppose cuts in Social Security, Medicaid and Medicare and “want the wealthy and large corporations to pay their fair share of taxes” to balance the federal budget.
“It is time to develop a federal budget that is moral and makes good economic sense,” Sanders said. “It is time to develop a budget that invests in our future by creating jobs, rebuilding our crumbling infrastructure and expanding educational opportunities. It is time for those who have so much to help with deficit reduction.”
Less than 10 percent of the American people approve of the job that Congress is doing, Sanders said, meaning “it’s time that we started to listen to what the American people want us to do.”
Those diametrically opposed views showcase the difficulty the two sides will encounter in attempting to reach a resolution by Dec. 13 – the date set by Congress as part of the recent agreement that reopened the federal government. But Sen. Patty Murray (D-Wash.), chairman of the Senate Budget Committee and the lead negotiator among Democrats, insisted she remains optimistic.
“I believe this bipartisan budget conference offers us the opportunity to rebuild some trust, find a path to compromise and work together to create jobs and boost our fragile economy,” Murray said. “I am hopeful we can at least show that bipartisanship is possible, that we can work together to solve some problems, and that we can break free from the gridlock and dysfunction that has dominated our nation’s capital for far too long.”
The least conferees should be able to accomplish, Murray said, is replacing sequestration – the across-the-board cuts imposed as a result of the unsuccessful 2011 budget negotiations – and offering a short-term spending package.
“This won’t be easy — the House and Senate budgets are very different even for just this year,” Murray said. “But if both sides are willing to move out of their partisan corners and offer up some compromises, I am confident it can be done.”
Murray and other Democrats on the panel hinted that they are willing to consider harsh spending cuts that replace sequestration, which they view as “inefficient and damaging.”
“I think there is a way that we cannot only protect savings but find ways to replace sequester,” said Sen. Mark Warner (D-Va.). “I know some of my colleagues think it hasn’t been that bad, but I believe it’s almost like a cancer inside. I can tell you, in Virginia, we are a little bit like Ground Zero because of the federal workforce and military personnel that live here. What we are doing in terms of hurting military readiness, costing taxpayers money because we the Department of Defense cannot do long-term purchase contracts, is totally irresponsible.”
Murray said she is prepared to make concessions to get a deal “but compromise runs both ways.” Rep. Chris Van Hollen (D-Md.), ranking member on the House Budget Committee, noted that resolving differences will prove impossible without “difficult compromises.”
“We cannot start these talks by taking things off the table, and we can’t be serious about reducing the deficit and then refuse to close a single tax break to help reduce that deficit,” he said. “It is hard to make progress when some people think compromise is a dirty word.”
But convincing the GOP to adopt tax and revenue measures to go along with spending cuts to reduce the deficit and debt may prove to be a bridge too far. Rep. Tom Price (R-Ga.) noted that the nation has gone $17 trillion in debt yet more than 16 percent of Americans — including 20 percent of all children — still live in poverty. Nearly 50 million live on $23,000 per year or less.
“Washington spends more and more and more, and yet our problems are getting worse and worse and worse,” Price said, and “taking more out of the pockets of hard-working Americans just to satiate Washington won’t solve anything.”
“At this point, a bailout for politicians – in the form of more taxes – so they can continue to spend well beyond our means is a recipe for more fiscal and economic pain,” Price said.
Committee Republicans, Price said, want to address Social Security and Medicare because they “will not have the resources needed to survive if they’re not strengthened.”
“We want to repair America’s ‘safety net,’ so that we may protect the most vulnerable among us in a fair and caring manner,” Price said. “We want to strengthen our national defense, so that the greatest nation the world has ever known can remain strong, independent and free. And we want to help grow the economy, so that the millions upon millions of our fellow Americans who are unemployed or underemployed can get back to work to support their families and realize their dreams.”
Warner agreed that the panel will have to consider entitlement reform because costs “are going to be greater than we’ve seen in the past because life expectancy now exceeds 80.”
“So we all know what we’re going to have to deal with — Democrats are going to have to deal with entitlement reforms and Republicans are going to have to deal with revenues, and we ought to be willing to at least approach those areas,” Warner said.
Murray said the lesson that lawmakers should have learned from the recent shutdown is that “the only way we can avoid gridlock and crisis — and the only way either side can get what they want — is through compromise and bipartisanship. That’s what the American people are expecting from this conference.”