October 3, 2010
NOT THAT THE TEA PARTIERS WOULD ACCEPT CHANGES TO THEIR SS AND MEDICARE EITHER...:
Tea Party may snuff out a chance to shrink government (Dana Milbank, October 3, 2010, Washington Post)
Democrats will have to swallow spending cuts to their beloved "discretionary" programs. Both sides will have to accept cuts in defense spending. And, yes, Republicans will have to tolerate a tax increase.Erskine Bowles, the Democrat who co-chairs the commission, has already offered a major concession: He says that two-thirds of the shortfall should be covered with spending cuts and the other third by increasing tax revenue. Democrats on the commission appear ready to accept a cap on discretionary spending -- similar to those that worked in the 1990s -- based on current or recent levels that will amount to a major across-the-board cut over time.
Republican commissioners, in turn, seem to be warming to the idea of attacking tax "expenditures" -- more than 170 exclusions, credits and loopholes, including the mortgage and charitable deductions. Reducing these tax expenditures has been endorsed by no less than Martin Feldstein, a Reagan administration economist, who regards them as the equivalent of government spending. By taking a chunk out of these $1.1 trillion in annual tax expenditures, the commissioners could plug the rest of the budget gap and still have room for a reduction in income-tax rates.
Because the recent health-care wars have wearied the lawmakers on the panel, the commission is likely to punt on the looming problem of Medicare. For now, the main question is whether Republicans can stomach a modest increase in tax revenue -- even if it's coupled with a much larger spending cut, and even if there's an overall reduction in income tax rates.
There's reason to believe that Bowles and Alan Simpson, the GOP co-chairman, will be able to corral the support of 14 of the 18 members -- the supermajority needed to send the recommendations to Congress. But that's where optimism dies.
You'd think that the Tea Party, which claims as its one unifying principle an aversion to the bloated size and scope of government, would leap at a deal like this and would press other conservatives to do the same. Yet it appears that the Tea Partyers and their allies would summarily reject anything that might be labeled a tax increase -- even eliminating tax giveaways and loopholes.
...but how serious is the Commission if it isn't even considering reforming the non-discretionary items?
