Ben Bernanke

Congress Ignores Obvious Policy Solution To Major Economic Threat

Brian Beutler | May 24, 2012, 5:12AM

If Congress passed legislation to fund the federal government for a year, then scattered to the four winds, the United States would find itself in recession sometime in 2013.

That's what the non-partisan Congressional Budget Office concluded in a Tuesday report, meant to alert elected officials to the dangers of allowing the country to fall off the "fiscal cliff." That's shorthand for allowing all of the Bush tax cuts and the payroll tax holiday, extended unemployment benefits, and Medicare physician reimbursement rates to expire; and to allow spending on domestic and defense programs to be cut indiscriminately. All of these things will happen automatically at the beginning of the year if Congress does nothing.

Budget deficits would fall dramatically, but at the expense of hundreds of thousands or millions of jobs at a time when the country's current economic maladies are just beginning to heal. By contrast, protecting the recovery likely means large budget deficits will persist for quite some time.

If there were an obvious way around this conundrum you'd think Congress would've taken it. In reality, according to policy experts and economists of a wide range of ideological leanings there is an obvious way around this conundrum -- and yet Congress isn't taking it.

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Medicare

White House Doubts Congress Can Pass Deficit Bill Before The Election

Brian Beutler | March 6, 2012, 6:00AM

A senior administration official says the White House could support balanced deficit reduction legislation if Congress passes it before the end of the year -- but sees no evidence that Republicans have moved off their now higher tax revenue position, and thus doubt policymakers will be able to reach an agreement that President Obama can sign.

Here's the background.

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Fiscal Commission

FAIL: Fiscal Commission Adjourns Without Holding Official Vote

Brian Beutler | December 3, 2010, 11:12AM

The 18-Member Commission on Fiscal Responsibility, Sept. 29th, 2010

After weeks of tumultuous negotiations, the White House's fiscal commission adjourned today without agreement on a controversial plan to reduce deficits by slashing spending and lowering income tax rates.

Recognizing that they'd fail to meet the 14-vote threshold for passage, the 18-member commission ultimately did not take a final vote. However, members announced their positions ahead of today's final meeting, and in the end a majority -- according to Sen. Kent Conrad (D-ND), 11 in total -- claimed to support the proposal.

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Paul Ryan

Republican Paul Ryan Opposes White House Fiscal Commission Plan

Brian Beutler | December 2, 2010, 10:42AM

Paul Ryan

Incoming Budget Committee chairman -- and fiscal commission member -- Paul Ryan (R-WI) will not be voting for the White House Fiscal Commission's report, he told reporters at a breakfast roundtable hosted by the Christian Science Monitor today.

"Obviously I'm not going to vote for it," Ryan said. "I think I pretty much telegraphed that."

Ryan was at pains to praise the commission's chairmen, Alan Simpson and Erskine Bowles, for their efforts, but ultimately criticized the plan dramatically -- in particular, he says, because it reinforces President Obama's health care law.

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Fiscal Commission

'Moment Of Truth'? Fiscal Commission Unveils Final Report

Brian Beutler | December 1, 2010, 9:41AM

The 18-Member Commission on Fiscal Responsibility, Sept. 29th, 2010

Below is a copy of the White House Fiscal Commission's final report, somewhat hilariously titled "Moment of Truth."

According to the panel's chairmen yesterday, today's deficit-reduction recommendations aren't dramatically different from those in their much-ballyhooed draft report: It still contains cuts to Social Security, and eliminates tax expenditures to broaden the tax base and dramatically flatten the system, making the top-bracket tax rates drop dramatically.

The commission was supposed to vote on a final package today, per the executive order President Obama signed when he created the commission. But dissent on the commission delayed the unveiling of these recommendations, so the vote will happen Friday.

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Jan Schakowsky

Schakowsky Unveils Progressive Deficit Reduction Plan

Brian Beutler | November 16, 2010, 1:07PM

Jan Schakowsky

A member of the White House's fiscal commission has released her own progressive plan for deficit reduction, after the commission's chairmen unveiled recommendations she vehemently opposes.

"Their proposal would have serious consequences for lower and middle class Americans, and that is why I cannot support it," says Rep. Jan Schakowsky (D-IL) in a statement. "I am releasing my own plan today because I believe that there is a better way to achieve our goal - one that protects the poor and the middle-class."

Her plan, which she claims would achieve fiscal balance by 2015, includes a host of ideas that were not included in the report released last week by Alan Simpson and Erskine Bowles. It makes provision for another $200 billion worth of stimulus to take the form of unemployment insurance extensions and additional aid to states.

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Fiscal Commission

Debt Commission Chairmen Seek To Head Off Leaks, Put Positive Spin On Report

Brian Beutler | November 10, 2010, 3:00PM

Alan Simpson

The White House's debt commission co-chairs were not planning on publicly releasing their preliminary recommendations, at least not in such a hurried fashion. But the commissioners' reactions to their eye-popping proposals weren't exactly positive. And so, concerned about potential leaks and negative press, the co-chairs decided to unveil it and get ahead of the spin, according to a source with knowledge of the proceedings.

In that regard, this afternoon's briefing was a bid to keep the commission and its work from unraveling precipitously -- to lay out their discussion document publicly, as a starting point from which members will have to work.

"This is not a package that I could support," said Rep. Jan Schakowsky (D-IL) -- one of the only progressives on the panel -- told Bloomberg during a break at the commission's private meeting this morning.

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Fiscal Commission

Breaking: Fiscal Commission Draft Report To Be Released This Afternoon

Brian Beutler | November 10, 2010, 12:25PM

President Obama meets with the leaders of his bipartisan debt commission, Democrat Erskine Bowles, on left, and former Republican Sen. Alan Simpson, on right.

This afternoon, the chairmen of the White House's fiscal commission -- officially, the National Commission on Fiscal Responsibility and Reform -- will unveil a draft of its recommendations for reducing budget deficits in the coming years, two sources tell me.

This is the "chairman's mark," authored by co-chairs Erskine Bowles and Alan Simpson, which commission members agreed should be made public. The final report, representing recommendations to Congress, would require the assent of 14 of 18 members of the commission.

Over the last several months, members of the commission had reportedly been struggling to reach consensus on big ticket items including Social Security, Medicare and tax revenue.

We'll keep you posted about what made it into the draft.

Late update: This post has been modified since first published.

Barack Obama

McConnell Praises Tea Party, Opposes Their Goal Of Earmark Elimination

Brian Beutler | November 4, 2010, 3:04PM

Senate Minority Leader Mitch McConnell (R-KY)

In a speech at the conservative Heritage Foundation this morning, Senate Minority Leader Mitch McConnell had kind words for Tea Party activists, who energized the GOP base but whose candidates likely cost Republicans control of the Senate. At the same time, though, he threw cold water on one of the movement's top goals -- an elimination of earmarks -- by noting that without Congressional input, President Obama will get to make most decisions on how federal money gets spent.

"Tea Party activists will continue to energize our party and challenge us to follow through on our commitments," McConnell said.

The Tea Party's top ally in the Senate is Jim DeMint (R-SC), who's also McConnell's main rival within the GOP caucus. DeMint plans to put the Republican conference on the spot about an earmark moratorium as soon as Congress returns. DeMint told the National Journal, "The first test vote will probably be as soon as we get back later in November: Will Republicans vote to ban earmarks ... to help a moratorium on earmarks? Because that's the rule change I'm going to bring forward and I think we'll see right away in the House and in the Senate whether or not Republicans are serious about what they ran on."

And yesterday, President Obama said he'd be happy to work with Republicans on such an initiative: "That's something I think we can -- we can work on together."

But McConnell says no way.

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Fiscal Commission

Andy Stern Says Fiscal Commission Shouldn't Be Dominated By GOP Ideas

Brian Beutler | October 13, 2010, 9:55AM

Andy Stern

Former SEIU President Andy Stern, who sits on President Obama's fiscal commission, says he will not endorse the panel's final recommendations if they are dominated by Republican ideas.

"There has to be a mix," Stern told me in an interview last night.

The bipartisan, 18 member panel has been tasked with providing policy guidance that will bring the country closer to fiscal balance. As TPM has reported, many of the Republican members are largely interested in securing spending cuts, and want to avoid tax increases of all kinds. Some are even pressing for lower tax rates for corporations, the cost of which could be offset by eliminating tax loopholes and giveaways (known officially as tax expenditures).

But Stern says he's looking for real tax increases. "I'm not an all-cut guy and I just don't know if tax expenditures can produce enough revenues on their own."

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Tax Cuts

Durbin: GOP Tax Cut Stubbornness Could Cripple Obama's Fiscal Commission

Brian Beutler | September 29, 2010, 9:01AM

Sen. Dick Durbin (D-IL)

One of the more progressive members of President Obama's fiscal commission acknowledged last night that the panel may find itself gridlocked if Republicans refuse to budge and agree to propose increasing tax revenue.

In a brief interview in the Senate press gallery, Senate Majority Whip Dick Durbin summed it up this way: "Any honest appraisal of our job and how we do it requires raising tax revenue, and reducing spending. If you don't do those two things, you can't reach your goal."

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Bush Tax Cuts

In Record Time, Fox Host Confuses Taxes, Spending, Socialism, And Fiscal Responsibility (VIDEO)

Brian Beutler | September 27, 2010, 7:15PM

Fox News hosts are masters at shouting down their own guests when disagreements arise. Here's a somewhat less-used tactic: increasingly absurd, scattershot questions, meant to yield an admission from the guest that she's a socialist.

This afternoon, Stuart Varney interviewed Occidental College professor Caroline Heldman, with the goal of walking Heldman, in Socratic-fashion, to the conclusion that President Obama is wrong to criticize the GOP for proposing "a series of policies that are just irresponsible...they say they want to balance the budget, they propose $4 trillion worth of tax cuts."

Unfortunately Varney confused "fiscal responsibility" with spending levels, and things went south from there.

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Fiscal Commission

Republicans On Obama Debt Commission Push For Corporate And Capital Gains Tax Cuts

Brian Beutler | September 27, 2010, 2:38PM

President Obama meets with the leaders of his bipartisan debt commission, Democrat Erskine Bowles, on left, and former Republican Sen. Alan Simpson, on right.

Republicans on President Obama's fiscal commission, which is tasked with coming up with ways to reduce the deficit, have privately argued in official meetings that the panel should recommend further corporate and capital gains tax cuts as part of its mandate. The panel has been charged with raising revenues and cutting spending, to bring the federal budget into greater balance. But if Republican members are successful, their advocacy would result in either an unbalanced report, dedicated wholly to spending and benefit cuts -- or to gridlock and, thus, no recommendations at all.

At a tax reform working group meeting last week, Republicans argued against every possible tax increase. According to one source familiar with the deliberations, Republicans were even opposed to eliminating loopholes, exemptions, credits and other so-called "tax expenditures" unless the associated revenue increase could be used to lower capital gains and corporate income rates.

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Peter Orszag

Orszag: Extend The Bush Tax Cuts

Brian Beutler | September 7, 2010, 8:46AM

Peter Orszag

In his new role as New York Times columnist, Peter Orszag proved won't just be a soldier for the Obama administration. In his first piece, the President's just-departed budget director created a big headache for his former boss by calling for a two-year extension of all the Bush tax cuts -- including the ones for the wealthy.

The White House and Democratic leaders on the Hill want to let the tax cuts benefiting the wealthiest expire, but are facing opposition from some of their own members, who will now have Orszag to cite as justification for holding out.

"[T]he best approach is a compromise: extend the tax cuts for two years and then end them altogether," he wrote. "Ideally only the middle-class tax cuts would be continued for now. Getting a deal in Congress, though, may require keeping the high-income tax cuts, too. And that would still be worth it."

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Veterans

Vet Group Calls On Obama To Fire Alan Simpson

Brian Beutler | September 2, 2010, 12:36PM

President Obama meets with the leaders of his bipartisan debt commission, Democrat Erskine Bowles, on left, and former Republican Sen. Alan Simpson, on right.

In a letter to President Obama, Vote Vets chairman John Soltz demands that Alan Simpson lose his job as co-chair of the White House's fiscal commission. Key quote:

"[O]n Tuesday, Senator Simpson actually put veteran's benefits on the chopping block...blaming disabled veterans for the country's fiscal situation. And for us, that is the final straw," Soltz wrote. "We ask that you remove him from his current position so that the commission can continue its work in a way that will give the military community--and all Americans--confidence in the conclusions it reaches."

This week, citing a program that covers veterans exposed to Agent Orange for diabetes testing and treatment, Simpson said, "The irony (is) that the veterans who saved this country are now, in a way, not helping us to save the country in this fiscal mess." White House spokesman Robert Gibbs told reporters this week that Simpson will stay on the commission.

You can read the entire letter below the fold.

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Social Security

Gibbs: Despite Titgate, Simpson 'Will Continue To Serve' On Debt Commission

Brian Beutler | August 30, 2010, 3:52PM

White House Press Secretary Robert Gibbs

Progressive activists have one more reason to be dissatisfied with the White House. A growing coalition of groups, along with members of Congress and Congressional hopefuls, have called in recent days for Social Security foe Alan Simpson to be fired from the National Commission on Fiscal Responsibility and Reform. Today, White House Press Secretary Robert Gibbs said it's not gonna happen.

"Senator Simpson sent an email that he's now apologized for," Gibbs said at the daily White House press briefing today. "We regret that he sent that email. We don't condone those comments. But Senator Simpson has and will continue to serve on the commission."

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Social Security

Tit's A Big Deal: Alan Simpson's Long History Of Advocating Social Security Cuts

Brian Beutler | August 26, 2010, 1:00PM

Alan Simpson, co-chair of the National Commission on Fiscal Responsibility and Reform

When Alan Simpson stepped in it late Tuesday he probably didn't think he'd find himself on the receiving end of a barrage of criticism and calls for him to resign his position as co-chair of the White House's fiscal reform commission. After all, comparing Social Security to a "milk cow with 310 million tits" is inartful and inapt, but hardly a terminal offense.

Except Alan Simpson isn't just any old Social Security commentator, and progressives, say what they will, weren't really reacting to the analogy or the questionable language. They were reacting to Simpson himself, who's spent much of his life looking for ways to fundamentally alter (he would say "enhance", but most would say "cut") Social Security. To them, Simpson's criticism was a harbinger of how the 18-member commission will propose to change the most popular entitlement program in the country, and it raises the question, again, of why President Obama appointed him in the first place.

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