'Gang of Six' plan hailed as debt-ceiling breakthrough. What's in it?
The proposal by the 'Gang of Six' senators Tuesday draws on ideas from the deficit commission. The middle-of-the-road plan will have to overcome partisan concerns and a lack of time.
(Page 2 of 2)
Senate majority leader Harry Reid (D) of Nevada called the work of the Gang of Six “extraordinary” and has asked Senator Warner – a member of the gang known for his skills as a “closer” – to report back in 24 hours with elements of the plan that can be used in a deal on raising the debt limit.Skip to next paragraph
Subscribe Today to the Monitor
But there are many potential pitfalls.
Until the plan is released in detail and scored by the Congressional Budget Office, it’s not clear how much of a dent it makes in the nation’s debt problems – or whether, in fact, it can help lawmakers find a solution to the debt-limit impasse by Aug. 2.
After Tuesday’s announcement of a Gang of Six deal, “there was a little bit of relief rally on Wall Street,” says Stan Collender, a budget analyst and partner at Qorvis Communications in Washington. “But it’s very complicated, and spending cuts are potential.”
Moreover, the first flush of excitement could soon run into partisan realities, says Mr. Collender. “Early press reports that 50 senators had already signed onto the plan turned out not to be accurate,” he says. “I suspect the longer the plan stays out there, the less it will have support. And in the Senate, the relevant number is 60" votes.
Groups at both ends of the political spectrum are already registering their concerns.
“The Gang of Six’s plan is a much grander version of kicking-the-can-down-the-road plans, because it’s mainly focused on procedures to put off decisions about what programs to cut now,” says Chris Edward, director of tax policy studies at the CATO Institute, a libertarian think tank. He adds that the tax hike in the plan is likely to be near $2 trillion over 10 years, but until details are released, it’s not clear.
Meanwhile, liberal groups such as MoveOn.org opposed elements of the plan that would cut benefits in entitlement programs. “MoveOn’s 5 million members are counting on [House minority] leader [Nancy] Pelosi, Senate majority leader Reid, and other Democrats to stand by their promise to reject any benefit cuts to Social Security and Medicare,” said Justin Ruben, executive director, in a statement on Tuesday.