President Obama has
announced his deficit-cutting plan as has Republican Senator Paul Ryan. The
problem is those plans are light-years apart with little hope of getting
either plan out of the Senate.
Ryan's plan may pass the House where Republicans have a solid majority, but
it would immediately be dead on arrival in the Senate.
In recognition of the above, a group of six senators, three
Republicans and three Democrats got together, and after nearly splitting up
over differences, have managed to come together with a plan to reduce
Gang of Six Members
Senator Richard J. Durbin, a progressive Democrat
Senator Kent Conrad a North Dakota Democrat who
leads the Budget Committee
Senator Mark Warner, a Virginia Democrat.
Senator Saxby Chambliss, a Georgia conservative
Senators Tom Coburn M.D. an Oklahoma, Republican
Senator Michael Crapo an Idaho Republican
"Gang of Six" Nears Consensus on Deficit Plan
Please consider ‘Gang of Six’ in the Senate Seeking a Plan on Debt
after President Obama called for forming a bipartisan group in Congress to
begin negotiating a $4 trillion debt-reduction package, the parties have not
even agreed to its membership. Yet six senators — three Democrats,
three Republicans — say they are nearing consensus on just such a plan.
Whether the so-called Gang of Six can actually deliver something when
Congress returns from a recess in May could determine whether Democrats and
Republicans can come together to resolve the nation’s fiscal problems
before the 2012 elections.
As Mr. Obama and Republican leaders have warred publicly over the budget,
this small group of senators has spent four months in dozens of secretive
meetings in offices at the Capitol and over dinner at the suburban Virginia
home of Senator Mark Warner, a Democrat.
The senators have weathered criticism from bloggers and even colleagues,
including the leaders of their own parties, who oppose tampering with Social
Security or taxes. The gang nearly collapsed several times, including two
If Mr. Durbin and Mr. Chambliss can cut a deal on Social Security and new tax
revenues, their associates say, then just maybe all
of Washington can come together.
For Republicans, that means accepting higher taxes and lower military
spending. For Democrats, it would mean agreeing to curbs on the unsustainable
growth of Medicare and Medicaid spending, as well as tweaks to Social
Security, to avert a big shortfall in 2037 and as a trade-off for
Republicans’ support on taxes.
Several months ago, with Mr. Durbin as its most surprising yes vote, 11 of
the 18 members of the president’s fiscal commission backed a blueprint
to pare $4 trillion from projected deficits in the first decade. It would cut
domestic and military spending; curb Medicare and Medicaid; and overhaul the
tax code, limiting or repealing tax breaks and using the new revenues to
lower tax rates and reduce deficits. Separate from its debt-reduction plan,
the panel proposed benefit and payroll tax changes to stabilize Social
Security for 75 years.
Mr. Durbin, the liberal Democrat, and Mr. Chambliss, the conservative Republican,
may have the most at stake. Mr. Durbin could be isolated in the Senate
leadership, and Mr. Chambliss potentially vulnerable given Republicans’
penchant for ousting incumbents who deviate from the antitax
line. Neither senator faces re-election until 2014.
An administration official recalled that in early 2010, when Mr. Durbin was
named to Mr. Obama’s fiscal commission, another White House official
told its co-chairmen, “You’ll never get Durbin’s
Nine months later, Mr. Durbin announced his support in The Chicago Tribune
for the recommendations the chairmen had negotiated with members. “The
question my closest political friends are asking is this: Why is a
progressive like Dick Durbin voting for this deficit commission report?”
he wrote. The answer: “Borrowing 40 cents out of every dollar we spend
for missiles or food stamps is unsustainable.”
A bolt came in February from Grover Norquist, a
Republican antitax activist, who wrote to Mr.
Chambliss, Mr. Coburn and Mr. Crapo to say they would violate his
group’s “Taxpayer Protection Pledge” if they supported
raising revenues for deficit reduction.
The trio countered the same day, releasing a letter telling Mr. Norquist that their effort broke no pledge “but
rather affirms the oath we have taken to support and defend the Constitution
of the United States against all enemies, foreign and domestic, of which our
national debt may now be the greatest.”
Reduced Military Spending?
Of the six senators, I am probably closest aligned philosophically-speaking
to Senator Tom Coburn of Oklahoma. He is one of few Republicans willing to
consider doing something about bloated military spending.
Please consider his Memorandum on the Defense Budget to the Debt
decades of acquisition reform from Congress, the Pentagon, and the think
tanks, the Government Accountability Office (GAO) tells us that cost overruns
in weapon systems are higher today, in inflation adjusted dollars, than any
time since they have been measured. Last year, Congress passed the Weapon
System Acquisition Reform Act of 2009. Almost every Member of Congress
supported it, along with top Department of Defense managers. The early
returns on the enactment of this legislation are not encouraging. ...
The single most important step to solving this depressing array of problems
is to better understand how the Pentagon spends its money - both historically
and prospectively. Without an accurate grasp at the start of a spending
program as to its most likely cost, schedule, and performance, how can
decision makers understand the future consequences of their actions? Today,
an ethic continues to predominate in the Pentagon that consistently paints an
inaccurate picture – one that is biased in the same, unrealistic and
ultimately unaffordable direction. The errors are not random: actual costs
always turn out to be much higher than, sometimes even multiples of, early
The reason is simple; the Pentagon doesn't know how it spends its money. In a
strict financial accountability sense, it doesn't even know if the money is
spent. This incomprehensible condition has been documented in hundreds of
reports over three decades from both the Government Accountability Office
(GAO) and the Department‟s
own Inspector General (DOD IG).
Please read that
memorandum. It describes many problems with military spending gone wild, and
how little we get for what we do spend.
Are Senators Saxby Chambliss, Tom Coburn, and Michael Crapo heroes or goats
for considering higher taxes?
depends on details we have not seen:
Will it balance the budget?
Existing Plans Not Passable
Obama's plan does not balance the budget. Neither does Senator Paul Ryan's
plan. Moreover, I highly doubt one can come close to balancing the budget
without considerably raising taxes or considerably cutting the defense
budget, most likely both.
Sure, one can balance the budget in theory without raising taxes, but it
would require massive cuts in military spending, huge cuts in entitlements,
and getting rid of entire departments such as the Department of Energy and
Department of Education.
I am in favor of all those things, and if there was anything left over, I
would be quite fine with tax hikes. However, my plan has no chance either.
What is the Goal?
Even if Republicans win the presidency in 2012, unless Republicans pick up a
filibuster-proof majority in the Senate, it will be difficult to get much
We will not accomplish much without a goal. Unfortunately, there is no goal.
I have a simple proposal: Balance the budget by 2022 come hell or high water
To achieve that goal will require compromises. Republicans will have to give
in on defense spending and taxes. Democrats will have to give in on
entitlements. Crop supports have to end.
Crop support is not Republican or Democratic issue per se, but a difference
between agricultural vs. non-agricultural states.
Scrap Davis-Bacon, Enact National Right-to-Work Laws
There are also many structural problems that need to be addressed. States and
municipalities need relief as well.
To help states and muniucipalities, we need to
scrap Davis-Bacon and all prevailing wages laws. We also need enactment of
national right-to-work laws.
Not only will those changes reduce costs on federal infrastructure work
(interstate highway repair for example), those changes will provide enormous
help to cities and states forced to pay union wages and benefits to get
We need a free market in medical insurance. As such, medical insurance plans
need to cross state lines, and drug imports from Canada must be allowed. I
recommend lower patent times on drugs. Medicare should only offer generic
The above health-care proposals would provide enormous savings.
Will Anything be Done?
I do not know what is in the "Gang of Six" plan because details are
not out. What I do know is the status quo is not acceptable, and that
existing plans by Obama and Paul Ryan are not passable.
Do Republicans and Democrats really want to do something about the deficit? I
suspect not, but we are about to find out.
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