Obama: I Want More Taxes; Simpson & Bowles: Sorry, Entitlement Cuts are Next
Backdropped by risers of emergency-services workers, President Obama today issued a generic call to avert the sequestration March 1 by telling Republicans to agree to even more tax hikes.
But his own deficit reduction commission issued a paper today noting that he already got his expiration of upper-income tax cuts last month and stressing the next steps must be entitlement reform.
"I'm willing to save hundreds of billions of dollars by enacting comprehensive tax reform that gets rid of tax loopholes and deductions for the well off and the well connected without raising tax rates," Obama said. "...I have to say, though, that so far, at least, the ideas that the Republicans have proposed asks nothing of the wealthiest Americans or biggest corporations. So the burden is all on first-responders or seniors or middle-class families. They doubled down, in fact, on the harsh, harmful cuts that I've outlined. They slashed Medicare and investments that create good middle-class jobs."
"So now Republicans in Congress face a simple choice," he continued. "Are they willing to compromise to protect vital investments in education and health care and national security and all the jobs that depend on them, or would they rather put hundreds of thousands of jobs and our entire economy at risk just to protect a few special interest tax loopholes that benefit only the wealthiest individuals and corporations?"
Republicans have already called for simplifying "a needlessly complex and manipulative tax code." Minority Whip John Cornyn (R-Texas) said Obama is pointing the finger of blame in the wrong direction.
“Today President Obama said 'these cuts are not smart, these cuts are not fair, and they will hurt our economy,' but what he neglected to say is that these cuts were his idea," Cornyn said. “There is bipartisan agreement that the President's sequester is not a smart way to cut spending, and Republicans have repeatedly offered and passed solutions to achieve the same amount of deficit reduction in a more responsible way without tax hikes."
“Any effort to avert the sequester should begin with the billions of dollars in frivolous projects, government waste, and duplicative spending that have propagated our runaway debt and deficits," he added.
The framework released by former Clinton chief of staff Erskine Bowles and former Sen. Alan Simpson (R-Wyo.). said the next step is needed this year to save $2.4 trillion.
That includes reducing Medicare and Medicaid spending through a series of reforms including adjusting benefits and payments and reducing drug costs; enacting tax reform that includes simplification of the tax code; strengthening limits on discretionary spending; cutting non-health mandatory spending including in education; and adopting chained CPI.
Simpson and Bowles said this year reforms also need to get under way to make Social Security "sustainably solvent."
Next year, they said, a highway bill is required to bring transportation spending and revenues in line. Infrastructure spending is one of Obama's sacred cows.
"It is clear that further reforms will be necessary to keep this country's debt on a sustainable path while also avoiding the sequester," Simpson and Bowles wrote. "Although additional deficit reduction need not be enacted all at once in a single package, it should be enacted promptly; the longer we wait the fewer options we will have and the less time we will be able to give individuals and businesses to prepare and adjust."
Obama simply said at his statement today that he's "laid out specific reforms to our entitlement programs that can achieve the same amount of health care savings by the beginning of the next decade as the reforms that were proposed by the bipartisan Simpson-Bowles Commission."
"While a plan to reduce our deficit has to be part of our agenda, we also have to remember deficit reduction alone is not an economic plan," Obama said.
In a Senate Appropriations Committee hearing last week, an Office of Management and Budget official couldn't give a straight answer on what that entitlement reform would be.
“He is the president of the United States. He’s supposed to lead,” said committee member Sen. Lamar Alexander (R-Tenn.). “He has not put forward a plan to deal with entitlement spending."
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