Entries in Deficit Reduction (27)


Obama Heads to Capitol Hill in Search of Deficit Deal

Alex Wong/Getty Images(WASHINGTON) -- President Obama kicks off a three-day series of rare meetings on Capitol Hill Tuesday, as he attempts to convince Congress to reach a deal to rein in the nation’s deficit.  

Obama will make the trip up Pennsylvania Avenue Tuesday afternoon for a meeting with the Senate Democratic caucus.  Over the course of this week, the president will woo Republicans and Democrats in both the House and Senate as he tries to cut a deal.

After Congress and the White House failed to reach a deal to avert $85 billion in across-the-board sequester cuts, and just months after the bitter battle over the “fiscal cliff,” the president is hoping to capitalize on a brief lull before the next fiscal deadline.

“Now we have a period where, because of the choice to let the sequester take effect, we are not now in a countdown clock situation,” White House Press Secretary Jay Carney explained last week.  “There is an opportunity here to do what some members of Congress and leaders have said they would like to do, and we agree, and that is return to some sense of normalcy here, regular order, engage in a budget process and negotiation and debate that hopefully produces a bipartisan compromise.”

Obama’s outreach campaign, which began with a dinner with Republican senators last week and has been welcomed by lawmakers, will be tested this week.

The president’s meetings on the Hill come as Congress considers budget resolutions in both chambers.

House Budget Committee Chairman Paul Ryan, R-Wis., and Senate Budget Committee Chair Patty Murray, D-Wash., are both expected to release their budget blueprints for 2014 this week.  The proposals, however, are expected to be far apart.

Carney said on Monday that the president’s discussions with lawmakers will not be budget negotiations.

“I wouldn’t expect that they’re going to trade paper on numbers,” he said.  “[The president] looks forward to making clear what his policy positions are, to making clear his sincerity when it comes to his belief that we need to take action on our deficit.”

The president is required by law to submit his budget to Congress no later than the first Monday in February, but Obama has yet to release his plan and the White House has not set a date for him to do so.

Also this week, Senate Democrats will introduce their bill to fund the government through the end of the year, after the House passed a version last week.  Most federal agencies will run out of money on March 27 if Congress doesn’t act.

Copyright 2013 ABC News Radio


Bill Clinton Advises Obama to Talk More About Deficit Reduction

Archival photo. Official White House Photo by Pete Souza(WASHINGTON) -- President Obama should push deficit reduction to the foreground in his race against Mitt Romney, Bill Clinton suggested Tuesday.

“You know, I think the two plans ought to be talked about more,” the former president said, interviewed onstage at the Peter G. Peterson Foundation’s 2012 Fiscal Summit in Washington, D.C., by NBC’s Tom Brokaw.

“The president, I think, should talk more about the Medicare savings he has proposed, and the defense cuts he has proposed, and the fact that he proposes, and this – I disagree with this, by the way – he proposes to take discretionary non-defense spending to its lowest percentage of GDP since president Eisenhower was in office,” Clinton said. “We ought to be talking about this stuff. He has at least tried to honor the deal he made with the Republicans, and I think he should talk more about it, and I think they should talk more about it...

“I think this budget issue ought to become front and center in the presidential election, in all the debates, in very specific ways,” Clinton said.

The former president said he favors overhaul resembling the Simpson-Bowles plan, produced by Obama’s bipartisan commission to address the deficit. Clinton suggested there should be a “big bipartisan coalition for this,” in reference to centrist-deficit reforms. “We may just have to wait until the election’s over. The American people are going to have to decide.”

Clinton called for immediate passage of a deficit-reduction plan, triggered to take effect when the economy meets growth benchmarks.

“What I would like to see them do is what Simpson-Bowles said. Simpson-Bowles said, ‘Pass our plan.’ I’d like to even see them take more out of the deficit more quickly than Simpson-Bowles. But they said, ‘Pass our plan, but trigger it when there is clearly growth,’” Clinton said. “Because you won’t have to convince anybody to do it then, because as soon as there’s real growth back in this economy, with all this public debt out there that has to be financed, interest rates will go through the roof, the cost of financing the deficit will be staggering, and the private sector will be screaming for affordable credit.”

Watch C-SPAN video of Clinton’s remarks here.  They come within the first 15 minutes.

Copyright 2012 ABC News Radio


Senate Budget Chair Defends Kicking the Can Down the Road

Douglas Graham/Roll Call/Getty Images(NEW YORK) -- Senate Budget Committee Chairman Kent Conrad (D-N.D.) has a plan for solving the nation’s debt crisis but doesn’t expect anything to get done before the fall election.

“I think Senator [Harry] Reid has made the judgment, quite correctly, that there is very little chance that we’re going to get the two sides together before the election,” Conrad said on “Fox News Sunday” of the Senate majority leader.

Conrad believes the only way Congress can significantly reduce the deficit is through a bipartisan deal.

“We’ve got to have a long-term plan,” he said. “The only way you’re going to have a long term plan that’s sustainable is that we get Democrats and Republicans to agree.”

Conrad joined the Senate in 1992 and is a staunch advocate for deficit reduction. The national debt has surpassed $15 trillion and is well on its way to $16 trillion.

Republicans blame Obama and Democrats for the debt increase while some economists attribute the jump to loss of revenue resulting from the recent economic downturn.  Fiscal conservatives are worried that the interest on the debt will grow so large that the government will have to cut services to pay down the interest.

Federal Reserve Chairman Ben Bernanke has warned Congress of the danger and House Budget Committee Chairman Paul Ryan, (R-Wis.) has described it as the most predictable crisis.

Conrad said, “What we need, I believe, is at least a 10-year plan. That’s why I’m going to mark up the first week that we’re back in session.”

Republicans have characterized such an approach as cowardly.  Sen. Rob Johnson, (R-Wis.) attacked Conrad’s approach while on “Fox News Sunday” with the senator.

“So you got 23 Democratic Senate seats up. Sixteen of those Democratic senators are running for re-election,” Johnson said. “They don’t want their fingerprints on a plan.”

But Conrad believes that Congress will have no choice but to act after the election.

“After the election, when we’re faced with all tax cuts expiring and we’re faced with a sequester, that would be the time that people have more open minds,” Conrad said.

The Budget Control Act (also known as the “Super Committee”) mandates deep-reaching defense and health care cuts by 2013.  Obama will also have a chance to negotiate for the repeal of the Bush tax cuts, which are also set to expire in 2013 because of a deal Obama cut at the end of 2010.

Obama will likely break a campaign pledge to cut the deficit by half in his first term.  White House Chief of Staff Jacob Lew argues that the administration couldn’t have anticipated the scope of the nation’s economic woes that have led to higher-than-expected spending.

Conrad has announced that he will not be seeking re-election this year.

Copyright 2012 ABC News Radio


Step Aside, Supercommittee, the Gang of Six May Stage a Comeback

iStockphoto/Thinkstock(WASHINGTON) -- Sidelined in part while the 12-member supercommittee worked, in futility, these past months toward the goal of finding at least $1.2 trillion in deficit reduction over the next 10 years, the Gang of Six is breathing new oxygen into the power of their bipartisan group of senators on Capitol Hill following the failure of the supercommittee.

Last night the members of the so-called Gang of Six -- Republicans Tom Coburn of Oklahoma, Saxby Chambliss of Georgia and Mike Crapo of Idaho, and Democrats Dick Durbin of Illinois, North Dakota’s Kent Conrad and Virginia’s Mark Warner -- held a private dinner meeting in Senator Durbin’s Capitol Hill office, Max Gleischman, spokesman to Durbin, confirmed Tuesday. Senator Michael Bennet, D-Colo., and Senator Mike Johanns, R-Neb., also joined.

The working dinner, which aides say happens with some regularity, carries new weight and importance following the failure of the supercommittee.

Congress is suddenly faced with a mountain the supercommittee could not climb, a way to find deficit cuts to make sure the sequester -- the trigger-starting, devastating, automatic and across-the-board cuts to the federal budget -- does not kick in.

Senate aides with knowledge of the dinner meeting say the group is continuing the work they started this past January, trying to turn the Bowles-Simpson plan into a bipartisan bill. Their goal remains the same, to reach at least $4 trillion in deficit reduction over 10 years.

But Tuesday, Senate Majority Leader Harry Reid, D-Nev., splashed cold water on the idea that the Gang might be on to something, calling the group’s ideas nothing more than “happy talk.”

“If someone has a proposal about reducing the deficit, the debt, here’s my suggestion: put it in bill form in writing. Not all these happy statements about what people think can be done. I am stunned by the Gang of Six that we hear so much about,” Reid said, adding that the three Republican members of the Gang of Six -- Senators Crapo, Coburn and Chambliss -- have all signed letters saying they will not raise any taxes. “Put it in bill form, and have it scored, bring it to me and I’ll take a look on it. But other than that, it’s just happy talk.”

Aides to members of the Gang of Six say that they are currently meeting and evaluating whether it’s feasible that they could get something in legislation form.

In July, during the height of the debt debate in Congress, before the conception of the supercommittee, the Gang of Six’s debt proposal on Capitol Hill had some momentum on Capitol Hill.

The plan, with a goal of $3.7 trillion of deficit reduction over the next 10 years, called for a $500 billion down payment on cutting the deficit. There would be an increase in tax revenues by $1 trillion by closing a variety of special tax break and havens, which would amount to a net tax decrease of $1.5 trillion because the Alternative Minimum Tax would be repealed.

It is not clear if the Gang of Six would build off that proposal, which was supported by a large group of senators, in their new plan when and if one is written in legislative form.

Copyright 2011 ABC News Radio


Deficit Hawks Warn Super Committee on Consequence of Failure

Hemera/Thinkstock(WASHINGTON) -- The four chairmen that headed two previous panels examining deficit reduction warned the Joint Select Committee on Deficit Reduction of the consequences of failing to reach a bipartisan deal that saves at least $1.5 trillion over the next decade.

Pete Domenici, Alan Simpson, Alice Rivlin and Erskine Bowles testified Tuesday before the so-called super committee to explain their previous attempts at reducing the deficit, and encouraged the exclusive committee to reach for a grand bargain slicing about $4 trillion from the federal deficit.

Bowles, who along with Simpson was co-chair of President Obama’s National Commission on Fiscal Responsibility and Reform, said he believed “the American people will support [the committee] if you make these big, bold, smart decisions.”

“Collectively, I’m worried you’re going to fail -- fail the country,” Bowles, who also served as chief of staff to former President Bill Clinton, warned.  “Our commission came up with a balanced plan of $4 trillion in deficit reduction over the next decade.  We didn’t make the $4 trillion number up because the number four bus rode down the street.  Four trillion dollars is not the maximum amount we need to reduce the deficit.  It’s not the ideal amount.  It is the minimum amount we need to reduce the deficit in order to stabilize the debt.”

Rivlin, who previously served as director of the Congressional Budget Office and director of Office of Management and Budget under Clinton, agreed that the committee “should craft a grand bargain involving structural entitlement and tax reform that would save at least $4 trillion over 10 years.”

Domenici, who along with Rivlin co-chaired the Debt Reduction Task Force, said that both political parties are “equally complicit” in the standoff that has brought the country to its knees and he warned that “our fiscal ship is destined to sink” if the bipartisan committee does not produce a plan to fundamentally restructure health care entitlements like Medicare along with revenue increases.

The committee is expected to produce a framework for a deal prior to its Nov. 23 deadline in order for the Congressional Budget Office to score the proposal.  The panel must produce a plan approved by a simple majority of the 12-member panel and the full Congress has until Dec. 23 to pass it into law.

Copyright 2011 ABC News Radio


Obama: Pass the Jobs Bill, Give Economy 'Jolt' It Needs

The White House(WASHINGTON) -- President Obama in his weekly address urges Senators to pass the American Jobs Act next week or risk facing an even weaker economy, saying his $447 billion bill will “provide our economy with the jolt that it really needs right now.”

“This jobs bill can help guard against another downturn here in America,” Obama says. “This isn’t just my belief.  This is what independent economists have said.  Not just politicians.  Not just people in my administration.  Independent experts who do this for a living have said that this jobs bill will have a significant effect for our economy and middle-class families all across America.  But if we don’t act, the opposite will be true – there will be fewer jobs and weaker growth.”

The president challenges Republicans in Congress who say they have a better plan to “prove it.” Citing economists who claim Republicans’ proposals would not result in near-term economic growth, the president says “if their plan doesn’t measure up, the American people deserve to know what it is that Republicans in Congress don’t like about this jobs plan.”

As for his plan to lower the deficit by asking “millionaires and billionaires to pay their fair share,” Obama explains “some see this as class warfare.  I see it as a simple choice.”

“We can either keep taxes exactly as they are for millionaires and billionaires, or we can ask them to pay at least the same rate as a plumber or a bus driver.  And in the process, we can put teachers and construction workers and veterans back on the job.  We can either fight to protect their tax cuts, or we can cut taxes for virtually every worker and small business in America.  But we can’t afford to do both.  It’s that simple,” the president concludes.

Copyright 2011 ABC News Radio


Obama Details His ‘Balanced Plan’ to Reduce Nation's Deficit

ABC News(WASHINGTON) -- President Obama outlined a revamped plan Monday to reduce the nation’s debt by more than $2 trillion in new deficit reduction through tax increases and entitlement reforms, asking “everybody to do their part so that nobody has to bear too much of the burden on their own.”

The plan, however, will likely be deemed dead on arrival by Republicans, who have vowed to reject tax increases as part of any plan to bring down the deficit.

“We can’t just cut our way out of this hole,” Obama said Monday in the Rose Garden.  “It’s going to take a balanced approach.  If we’re going to make spending cuts … then it’s only right that we ask everyone to pay their fair share.”

The bulk of the savings in the president’s plan comes from $1.5 trillion in deficit reduction through new taxes for high-end earners and $580 billion in cuts to entitlement programs, including $248 billion to Medicare and $72 billion to Medicaid.

The president’s recommendations for the Congressional “super-committee,” which is already tasked with identifying $1.5 trillion in cuts by Thanksgiving, are an attempt to quell criticisms that he has failed to offer a detailed outline of his vision for a “balanced approach” to deficit-reduction.

“Everybody, including the wealthiest Americans and biggest corporations, have to pay their fair share,” the president said.

In total, the president’s plan will claim more than $4 trillion in deficit reduction through entitlement cuts, tax increases and war savings, in particular, including $1.2 trillion in savings from the Budget Control Act and $1.1 trillion from drawing down the wars in Iraq and Afghanistan.

While the proposal is likely to please Obama’s Democratic base, the president is seeking to draw contrasts with Republicans and force them to align with corporations and the wealthy.  Obama made clear on Monday that he will veto any plan that seeks to cut the deficit through spending cuts alone and does not include tax increases as well.  

The move puts the White House at odds with Republicans who have already spoken out against the president’s plan to raise taxes, calling it “class warfare.”

Republicans are specifically taking issue with the president’s “Buffet Rule” proposal.  Named for the billionaire investor Warren Buffett,  the rule means those making more than $1 million a year would not pay a smaller share of their income in taxes than middle-class families pay.

Copyright 2011 ABC News Radio


Obama to Pitch Higher Taxes, Means-Testing Medicare

JEWEL SAMAD/AFP/Getty Images(WASHINGTON) -- President Obama on Monday will outline more than $2 trillion in new deficit reductions over the next decade, senior administration officials tell ABC News, including $1.5 trillion in new taxes and means-testing Medicare for wealthy recipients -- both in higher fees and benefit cuts for top income brackets.

Combined with savings from the debt deal and drawing down the wars in Iraq and Afghanistan, the proposal will guarantee that the size of the debt -- as a share of the economy and percentage of gross domestic product (GDP) -- will fall, with more than $4 trillion in deficit reduction total.

The president’s purpose in laying out this detailed plan is to avoid the criticisms that have dogged him throughout this year for not putting out a more assertive deficit reduction plan, and to further illustrate his “balanced approach,” requiring “shared sacrifice.”

A senior administration official described the president’s proposal as having “very tough policies in it, and we know that that’s going to be something that our friends and our opponents alike are going to notice.  But there is no way to get this job done without making tough decisions, and this is putting forward a plan that does it in a fair and a balanced way.”

The president will propose roughly $580 billion in cuts to mandatory spending programs, including $248 billion from Medicare and $72 billion from Medicaid and other health programs.  Part of this will include asking wealthier seniors who receive Medicare to pay higher premiums and accept fewer benefits -- means-testing the program.

But that said, the president will not accept any cuts to Medicare if tax increases on wealthier income brackets and corporations are not part of the final package.

“He will say that he will veto any bill that takes one dime from the Medicare benefits seniors rely on without asking the wealthiest Americans and biggest corporations to pay their fair share,” a senior administration official said.

Obama’s remarks will push the so-called “super-committee” charged with finding at least $1.2 trillion in deficit reduction by November to undertake comprehensive tax reform guided by five principles: lowering tax rates; eliminating wasteful loopholes and tax breaks; reducing the deficit by $1.5 trillion; boosting job creation and growth; and being consistent with the “Buffett Rule.”

The Buffet Rule, named in honor of billionaire investor Warren Buffett, will state that those who make more $1 million a year “should not pay a smaller share of their income in taxes than middle-class families pay,” a senior administration official said.

Other ways to raise taxes that the president will propose are now familiar: $800 billion from letting expire the lower Bush tax rates for the top two tax brackets; and $700 billion from other revenue -- capping income tax deductions for wealthier Americans; eliminating subsidies for petroleum companies; eliminating tax loopholes for corporate jets; and requiring hedge fund managers to pay a higher tax rate than the 15 percent carried interest rate they pay now.

Copyright 2011 ABC News Radio


'Super Committee' Convenes to Start Work on Reducing Deficit

Stephen Chernin/Getty Images(WASHINGTON) -- The D.C. lawmakers assigned to cut the nation's deficit convened for the first time Thursday and there was already evidence that their daunting task will be made more arduous by partisan bickering.

Members of the Joint Select Committee on Deficit Reduction, otherwise known as the "super committee," all seemed to have job creation on their minds with the unemployment rate still sitting at around nine percent.

Massachusetts Democratic Sen. John Kerry summed it up by remarking, "We can’t fix our budget without fixing jobs, and we can’t fix jobs without fixing our budget."

However, the six Republicans and six Democrats were evenly split on the best ways to grow jobs and couldn't decide just how fixing the employment picture will ultimately factor into the plans to slice $1.5 trillion from the budget in 10 years.  Democrats say that some sort of short-term jobs stimulus package was needed to help bring in more future revenue, while Republicans contend that cuts in spending and taxes alone is the sure-fire way to spur job creation.

Republican Congressman Dave Camp of Michigan said, "By reducing the burden the federal debt places on employers, families, and taxpayers, we can help get the country back on track and Americans back to work."

However, Maryland Democratic Congressman Chris Van Hollen countered with, "The quickest, most effective way to reduce the deficit in the short-term is to kick the economy into a higher gear and grow jobs.”

Thursday's proceedings were also constantly interrupted by shouts from a small band of protesters outside the meeting room, who chanted, "What do we want?  Jobs!  When do we need ’em?  NOW!"

The super committee has 76 days to come up with a plan to be delivered to President Obama.  Otherwise, $1.2 trillion in automatic spending cuts will kick in, divided evenly between defense and non-defense spending.

Copyright 2011 ABC News Radio


Pelosi Announces Picks for Deficit Reduction Super Committee

JEWEL SAMAD/AFP/Getty Images(WASHINGTON) -- House Minority Leader Nancy Pelosi has named her three choices for the select joint committee on deficit reduction.

Her choices are: Assistant Democratic Leader James E. Clyburn (South Carolina), the third-ranking member of House Democratic Leadership; Democratic Caucus Vice Chair Xavier Becerra (Calif.); and Budget Committee Ranking Member Chris Van Hollen (Maryland).

“The Joint Select Committee has a golden opportunity to take its discussions to the higher ground of America's greatness and its values.  It must meet the aspirations of the American people for success and keep America number one,” Pelosi, D-Calif., said in a statement. “The work of the Congress must go beyond the deliberations of the committee. Without waiting for the committee to complete its work, we should pass legislation for sustainable job creation. Congress should send to the President the long-delayed highway and FAA bills, which generate hundreds of thousands of American jobs; and Congress should approve a national Infrastructure Bank to create jobs and improve our competitiveness.

“We must achieve a ‘grand bargain’ that reduces the deficit by addressing our entire budget, while strengthening Medicare, Medicaid and Social Security.  Our entire Caucus will work closely with these three appointees toward this goal, which is the goal of the American people,” she added.

Clyburn and Van Hollen served on the Vice President Biden-led talks on deficit reduction earlier this year, while Becerra previously served on the Simpson-Bowles Commission.  

The trio join fellow Democrats Sens. Max Baucus (Mont.), Patty Murray (co-chair, Wash.), and John Kerry (Mass.)

The Democratic picks join Republican selections Reps. Jeb Hensarling (co-chair, Texas), Dave Camp (Mich.), and Fred Upton (Mich.) and Sens. Jon Kyl (Ariz.), Pat Toomey (Pa.), and Rob Portman (Ohio).

The timing of the first meeting of the exclusive panel has not been revealed. Lawmakers in the House of Representatives are scheduled to be on recess until after Labor Day, returning to legislative business on Sept. 7.

Copyright 2011 ABC News Radio

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