US debt crisis: Can a deeply divided 'Gang of Seven' make any progress?
The members of the House and Senate who were appointed to the latest presidential deficit panel represent the starkest partisan views on Capitol Hill. But that could be a good thing.
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The new panel is now in a race with the “Gang of Six,” which has been working since December to come up with a plan to bridge a vast partisan divide over the nation’s debt crisis. Four of those six senators were members of the president’s 2010 National Commission on Fiscal Responsibility and Reform, known as the Simpson-Bowles deficit commission, and backed its recommendations, which included spending cuts, tax increases and an overhaul of Medicare and Medicaid entitlements.Skip to next paragraph
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GOP leaders cautioned the White House not to expect the new panel to deliver concessions on their key demand: significant spending cuts. “We’ve said, many times, that if the president and our Democrat colleagues refuse to accept serious reforms that immediately reduce federal spending and end the culture of debt in Washington, House Republicans will not grant their debt limit increase. Period,” said majority leader Cantor, in a statement.
Senator Kyl, who has announced that he will not be running for reelection, has been one of the strongest voices in GOP ranks seeking to lower taxes as a path to growth. Not only did he oppose calls to end the Bush tax cuts for the wealthy, he also pushed to permanently end the estate tax.
“A serious and credible path forward to reduce spending is the only thing, in my judgment, that will get Republican votes in the Senate to raise the debt ceiling,” said Senate Republican leader Mitch McConnell, in a statement announcing the Kyl appointment. “Partisan speeches and promises of some future cuts after the president leaves office simply won’t suffice.”
Among the new panel’s Democrats, Senator Baucus has a long track record working across partisan lines with Sen. Charles Grassley (R) of Iowa on the Senate Finance Committee, but he voted against the final recommendations of the Simpson-Bowles commission, citing its impact on government programs for rural America. At a time when Republicans were calling for more than $60 billion in spending cuts for FY 2011, Senator Inouye’s panel proposed nearly $10 billion. On the House side, assistant leader Clyburn voted for a FY 2012 budget plan that financed nearly $4 trillion in deficit cuts over 10 years almost entirely with tax increases.
The panel begins work on a very tight deadline. The US Treasury Department estimates the nation will breach its $14.294 trillion debt limit by May 16, and could hold off default with accounting devices until around July 8. The president has asked the deficit panel to produce a plan for comprehensive debt reduction by the end of June.
“What the timing says to me is that they are just going to let the May debt limit go past, and go down to the brink in late June, allowing the pressure to build on Republicans from financial markets,” says Thomas Ferguson, a political scientist at the University of Massachusetts, Boston.