Ding Dong, The Super Committee Is Dead?

By Big Tent Democrat, Section Other Politics
Posted on Sun Nov 20, 2011 at 09:18:55 AM EST
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WaPo:

The congressional committee tasked with reducing the federal deficit is poised to admit defeat as soon as Monday, and its unfinished business will set up a year-end battle over emergency jobless benefits and an expiring payroll tax holiday.

While wasting most of the year on a non-existent "deficit crisis," the Beltway has ignored the jobs crisis. This neglect is brought into stark relief by what they think they need to do in December:

Democrats and many economists consider particularly urgent the need to extend jobless benefits and the one-year payroll tax cut. [. . .] Time is also running out for doctors who see Medicare patients. These physicians are scheduled to absorb a 30 percent cut in government reimbursements in January. A long list of tax breaks, including an inflation adjustment that protects more than 30 million families from paying the alternative minimum tax, also will be eliminated unless Congress acts.

Although many of the expiring provisions have received bipartisan support in the past, this year they face a welter of political obstacles, none more important than cost. Extending them all through 2012 threatens to add nearly $300 billion to annual budget deficits — and therefore to future borrowing — darkening the nation’s fiscal outlook at the very moment lawmakers had hoped to reassure financial markets with fresh savings.

"Fresh savings" are not what we need now. We need massive fiscal stimulus. But the Beltway, well, you know.

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Ding Dong, The Super Committee Is Dead? | 23 comments (23 topical)

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The beltway well (5.00 / 2) (#1)
by Edger on Sun Nov 20, 2011 at 09:28:12 AM EST

is a black hole into which you are unwillingly forced to pour your money, as it sucks the life out of the country.

Good that it will expire (5.00 / 2) (#2)
by MKS on Sun Nov 20, 2011 at 10:04:41 AM EST

Glad the Dems did not cave.

The Occupy movement may have helped.

Another reason to label these (5.00 / 3) (#3)
by MO Blue on Sun Nov 20, 2011 at 10:05:38 AM EST

attempts at cutting safety net programs "Cat Food Commissions."

They seem to enjoy the same "nine lives" as cats. All previous reports of their demise have been premature. I shudder to think about how the next assault will be structure since I fully expect it to rear its ugly head in 2012 or 2013.

Romney and a Republican Congress (5.00 / 1) (#4)
by MKS on Sun Nov 20, 2011 at 10:34:12 AM EST

wouldn't need a commission.

I have to wonder (5.00 / 8) (#5)
by nycstray on Sun Nov 20, 2011 at 11:02:25 AM EST

if Obama and a Republican congress would need one either.


John Conyers on educating people on (5.00 / 8) (#9)
by MO Blue on Sun Nov 20, 2011 at 12:29:25 PM EST

who was calling for cuts to Social Security in past budget deals:

At a press conference held by members of the House Out of Poverty Caucus Rep. John Conyers (D-Mich), the second most senior member of the U.S. House, was pointed in his criticism of the White House regarding jobs and cuts to Social Security the President put on the table last week. "We've got to educate the American people at the same time we educate the President of the United States. The Republicans, Speaker Boehner or Majority Leader Cantor did not call for Social Security cuts in the budget deal. The President of the United States called for that," ....link

Every time I see a link to this quote, I notice (none / 0) (#16)
by Farmboy on Mon Nov 21, 2011 at 09:18:11 AM EST

that the rest of the offer made by Obama to Congress is ignored by sites like FDL - specifically the $1 trillion in new tax revenues, an increase in the Social Security payroll tax cap, and that any changes to Social Security have to be made in "a balanced way that preserves the promise of the program and doesn't slash benefits."


None of those changes to Social Security (5.00 / 2) (#17)
by MO Blue on Mon Nov 21, 2011 at 11:07:10 AM EST

like raising the Social Security payroll tax cap were included in the negotiation with Boehner. Now you may think that changing the formula for calculating cost-of-living increases in order to reduce future payouts qualifies as merely cutting Social Security benefits rather than slashing them and the president's plans that had ratios of spending cuts to revenue of roughly three-to-one or maybe worse is a balanced approach but I would disagree.


Obama has been calling for raising the payroll (none / 0) (#18)
by Farmboy on Mon Nov 21, 2011 at 11:27:46 AM EST

tax cap since campaigning in 2008. He's called for it in the SOTU, he's had various congress critters propose it in blls and amendments, and it's in his proposed jobs bills. The folks stopping this from happening aren't at the WH.

As to the other changes you mention, that was part of the recommendations from the Simpson committee - recommendations that were only endorsed by the GOP, not the WH.


Yes he TALKED about raising (5.00 / 1) (#19)
by MO Blue on Mon Nov 21, 2011 at 12:09:01 PM EST

the cap. He has also talked about raising the eligibility age. What he personally negotiated is changing the formula for calculating cost-of-living increases in order to reduce future payouts. Other cuts to domestic and safety net programs that he personally negotiated:

Medicare: Raising the eligibility age, imposing higher premiums for upper income beneficiaries, changing the cost-sharing structure, and shifting Medigap insurance in ways that would likely reduce first-dollar coverage. This was to generate about $250 billion in ten-year savings. This was virtually identical to what Boehner offered.

Medicaid: Significant reductions in the federal contribution along with changes in taxes on providers, resulting in lower spending that would likely curb eligibility or benefits. This was to yield about $110 billion in savings. Boehner had sought more: About $140 billion. But that's the kind of gap ongoing negotiation could close.

Discretionary spending: A cut in discretionary spending equal to $1.2 trillion over ten years, some of them coming in fiscal year 2012. The remaining differences here, over the timing of such cuts, were tiny.


As you might remember, the meetings with Boehner (5.00 / 1) (#20)
by Farmboy on Mon Nov 21, 2011 at 02:45:06 PM EST

you're talking about were to raise the debt ceiling - a task that the Congress should and could have dealt with in ten minutes. It was the GOP who held the country hostage, not the President.

And yes, the President did offer a number of social program concessions during the negotiations with Boehner - tied to revenue increases that undid the Bush tax cuts on the wealthy (the extension of which we can agree was a mistake). As you might also remember, Obama followed up with a speech, right out in public, where he talked about how Boehner rejected everything Obama offered, including Boehner's own ideas.

It's like attempting to negotiate with a car salesman who refuses to not only entertain a lower price or sticker price, he won't accept any price - and then cries because the buyer won't negotiate "in good faith."

The offers to open discussions about reforming social programs only serve to illustrate the fact that taking back the WH next year is a higher priority than governing for the GOP and their backers. Boehner being a tool of the Koch Bros and their JBS friends doesn't mean that Obama has a "secret agenda." It means that Boehner is a tool.


: Raising the debt limit could have (5.00 / 1) (#22)
by MO Blue on Mon Nov 21, 2011 at 08:50:12 PM EST

been part of extending the Bush tax cuts in Dec but Obama chose not to include that provision. He wanted his Grand Bargain. He has said so on numerous occasions. He supported the cuts to domestic and safety net programs put forth by the Bowles/Simpson Commission, he supported the cuts to the domestic and safety net programs with even less revenue included in the Gang of Six proposals and he offered Boehner even more draconian cuts during his personal negotiations.
Don't kid yourself. Obama is dancing to the tune of his corporate masters just as much as Boehner.

Sad that the conversation (5.00 / 2) (#7)
by lilburro on Sun Nov 20, 2011 at 11:53:57 AM EST

is still about unemployment and payroll tax cuts. Bleh.

With due respect to President Truman, (5.00 / 3) (#8)
by KeysDan on Sun Nov 20, 2011 at 12:17:17 PM EST

what we need now is a "Do Nothing Congress." If the Super Committee fails (or its work product fails in Congress or by presidential veto), sequestration goes into effect Jan 2, 2013 and the Bush-era tax cuts expire January 1, 2013. The auto-cuts then run through 2021--$54.7 billion from Defense and the same from Non-Defense each year during that period.

That amount plus estimated interest savings make for the $1.2 trillion required by Congressional action or is the yield from its non-action. If all the Bush tax cuts expire, we are ahead by about $4 trillion, and we already have the first installment cuts since August 2, 20ll budget act of $900 billion. Even Standard and Poor might like that, or the "uncertain investors" and the confidence fairy. And, with all that money recovered, legislation that really benefits the country, develops infrastructure, creates jobs and provides tax cuts where needed might be crated without the ersatz deficit and debt panic. Or, the Pete Peterson, et al. agenda.

As Paul Krugman wrote last Friday: "Any deal reached now would, in practice, be nothing more than a deal to slash Medicare and Social Security." ..."if the Super Committee fails, as expected, it will be time to celebrate."

And, for doubters, just review the latest plan being considered by Senator Toomey (R.PA), that give $890 billion in cuts and $250 billion in revenues--and cuts the top marginal tax rate to 28 percent (from the Bush low of 35 percent, and Clinton from 39.6 percent). And, of course puts the Medicare age eligibility at 67 and lowers the cost of living increases for Social Security. And, this, apparently, is a serious alternative.

: Tax cuts on the rich! That's the ticket! (5.00 / 3) (#10)
by tigercourse on Sun Nov 20, 2011 at 01:18:21 PM EST

If there's one way to get us out a deep deficit it's to take in less revenue!
God, this congress.

Why do we (none / 0) (#6)
by Ga6thDem on Sun Nov 20, 2011 at 11:32:24 AM EST

need to extent the payroll tax cut? I mean it's been in effect and has done nothing. I'm really tired of the beltway promoting supply side voodoo.

while i don't necessarily agree with the (5.00 / 1) (#13)
by cpinva on Sun Nov 20, 2011 at 04:09:59 PM EST

temprorary reduction in the FICA tax, at least it puts some additional money in the pockets of people who will actually spend it, perhaps helping to increase consumer demand somewhat. obviously, the flip side of that is a long-term reduction in the trust fund. any reduction (or contiued reduction) in the marginal rates for high earners will do nothing for economic stimulus.

on the positive side, to fix that long-term trust fund deficiency is relatively simple, raise the income ceiling on the FICA tax. problem solved.

not that this will ever happen, but it is a viable solution.


: Why is that? (none / 0) (#14)
by NYShooter on Sun Nov 20, 2011 at 07:17:49 PM EST

My income was rising somewhat simultaneously to the increases in FICA income cutoffs. And, while I remember thinking, "well, I gotta make another 5G's before it's mine, all mine!" I also remember thinking, "whatta country, where else can a shmuck like me make enough money to keep Congress so busy chasing me?"
Also, because the raise in eligibility would go for programs almost everyone likes, shouldn't raising it be an easier sell than a straight income tax raise?

Not just supply side voodoo (none / 0) (#23)
by cal1942 on Tue Nov 22, 2011 at 12:20:32 AM EST

but also weakening the Social Security Trust Fund.

Tax cuts of any kind are, IMO, next to worthless for increasing demand.


Don't! (none / 0) (#11)
by TeresaInSnow2 on Sun Nov 20, 2011 at 01:26:07 PM EST

Don't get my hopes up!

channel surfing (none / 0) (#12)
by Capt Howdy on Sun Nov 20, 2011 at 02:33:26 PM EST

the talk shows this morning I ended up on FOX at just the right time to catch what seemed to be a unanimous admission by the panel that the failure of the Super and taking the argument of cuts or revenues into the 2012 election would help democrats and hurt republicans in a big way.

I had to check to make sure what channel I was on.

Where have you been? (none / 0) (#15)
by Abdul Abulbul Amir on Mon Nov 21, 2011 at 07:20:45 AM EST

We need massive fiscal stimulus.

We care in our third year of "massive fiscal stimulus" and record postwar spending and deficit.

More counterproductive policy is probably not what the doctor ordered.

BTW, those Medicare payment cuts in many cases go to doctors that are firmly in the top 1% by income.

: It's always ... (none / 0) (#21)
by sj on Mon Nov 21, 2011 at 03:46:47 PM EST

... trés amusing when someone like you tries to use the language of OWS as a vehicle of old-school wedge politics.
It's just so very awkward.