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Super Committee

Back in August, negotiations over the Federal budget were so impossible that Congress had to punt to a “Super Committee” that had until November 23rd to report back on how to proceed.  Failure to come up with a plan would trigger automatic spending cuts and probably quite a bit of chaos.

The bad news is that ten days out there is no sign of an agreement.  The good news is that it’s taking them so long because they are tackling the big issues such as tax and entitlement reform.

The process itself is deliberately private, meeting entirely behind closed doors.  The news we get comes in the form of leaks and answers to direct questions on how it’s going.  Most members are pretty candid about the possibilities of the panel coming to some conclusion, and some are a bit bleak.  But overall, experts in the field are hopeful.

News trickles out all the same, and if you want to follow it closely there is at least one site dedicated to the proceedings – Fiscal Times.  It is worth a follow if you want to get the latest reading on the tea leaves, often about all we have to go on.

What we do know is that the Republicans have decided that tax reform is not the same as raising taxes, although the effect may be the same.  This is one of the key principles of the Simpson-Bowles framework, and adopting it after nearly a year of speechifying and snarling is a major step forward.  It means that some new revenue, on the order of $300 billion over 10 years, is likely to be in the mix if there is an agreement in the next 10 days.

“The kind of reform we’re talking about is actually guaranteed to create millions of jobs over time and also bring more revenue,” said Sen. Pat Toomey, R-Pennsylvania.  By stressing growth there may wiggle room with the Republican base, but the proposal is on the table.  Will it get anywhere? “I believe that all of the ingredients for a good resolution are there,” according to Rep. James Clyburn D-South Carolina. “We just need to develop a will.”

Medicare reform has been far trickier, with no apparent breakthroughs at all.  It is almost certain to be part of the mix for the Republicans to accept tax reform of some kind, but a deal has eluded them as far as we know so far.

What we can say, however, is that the sides are very serious and are probably watching the situation unfold in Europe as they go forward.  Failure to create an agreement has tremendous consequences which they are all very aware of – even as the clock is ticking down.  Moody’s and other bond ratings firms have been rumored to have weighed in with threats of downgrades, although none has been made publicly.

What will happen in the next 10 days?  There seems to be a lot of will developing for a grand deal that will encompass everything that we know needs to be fixed in the future.  But will it pass before the deadline for all of Congress to act on December 23rd?  That is not as clear, but the relative silence from the rest of the very unpopular Congress suggests that they want to see what comes out of the Super Committee before they say anything.  That’s a good sign as well.

This process may yet work, but it has to work fast at this point.  There could yet be hope for the broken and dysfunctional Congress to achieve something not just adequate, but possibly even great.  We will see.

18 thoughts on “Super Committee

    • This will play out and raise the profile of the need for a process – if they fail, I think we can expect something to come of it one way or the other. But it may take a lot of activism to force it.

  1. “…There could yet be hope for the broken and dysfunctional Congress to achieve something not just adequate, but possibly even great.”

    I am not hopeful. 😐

  2. I have almost hope hope of anything good coming from this. I hear that there is even talk about getting rid of the automatic budget cutting “trigger” that they put in place, which is probably fine by me as long as were in a depression. But it shows what liars and fakes they all are.

    • That has been talked about, but Obama is firm that it not be removed. I think he finally has some leverage on the Republicans and intends to use it. Remember, automatic cuts come from the military, too …

  3. I don’t think the super-committee will come up with anything, there is no way they will have an agreement. The only question to me is whether people take it out on congress, Obama, or both.

    • There is little doubt in my mind that Obama has control at this stage, especially given the low ratings for Congress. I think he’ll hold them to this process, more or less erasing the mistake he made by not embracing Simpson-Bowles a year ago. But that’s behind us.
      Once again, I think the key for those of us not in elected office is to keep the profile of this “process” as high as possible so that we can hold Congress responsible for their failure to act.

  4. I too hold out little hope but it would be interesting to see if they come up something in the committee. It would make the case that they can’t get anything done in congress.

    • That’s what I’m thinking, too. But you never know – Congress might be running so scared that they actually do pass something if it’s sitting in front of them. My understanding is that procedurally whatever comes out of the Super Committee will go right to the floor and bypass the committee process, which is good.

  5. I don’t think Congress wants to ruin everyone’s Thanksgiving by not having a bill. Politics in the US of A is not a series of apocalyptic showdowns. Besides, not having a bill has foreign policy implications. With weakness in Europe and the Arab spring, Congress doesn’t want to look weak (this time!). That would be dumb. What gives me hope is that they have had their proceedings in secret, which helps the process along. The US Consitution deliberations were done in secret. Even then James Madison made a mistake by not having a Bill of Rights in the draft. But a guy named George Mason helped correct that.

    As long as Speaker Boehner doesn’t think he’ll lose his job by what the super-committee presents, then we are in good shape.

    • That’s what I’m thinking, too. Private deliberations will help just the way they did historically. Good point on Mason – as long as we have someone like him who can publicly correct the flaws in the private bill we’ll be OK. But that is such a different process I really don’t have a lot of hope for a final bill (until I see it and how that process plays out!).

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