CQ TODAY ONLINE NEWS – BUDGET
June 16, 2011 – 6:15 p.m.
Latest Conrad Fiscal 2012 Budget Closes Tax Breaks for Savings
By Paul M. Krawzak, CQ Staff
The latest version of a fiscal 2012 Senate budget resolution being drafted behind closed doors would cut the deficit by some $4 trillion over a decade, largely through reliance on eliminating tax breaks.
The plan, though not final, calls for raising revenue by about $2 trillion primarily through eliminating tax expenditures — the term of art that describes the myriad tax credits, deductions and other preferences in the code that benefit individuals, companies and organizations.
Senate Budget Chairman
Another $2 trillion in deficit reduction would come from a combination of cuts in government programs and the savings from reduced interest payments on the debt as it grows more slowly because of shrinking deficits.
The plan cuts both domestic and defense spending and reduces mandatory spending.
Conrad has steadily redrafted his plan in the hope of winning the unanimous support from Budget Committee Democrats he needs to move the budget resolution to the Senate floor. Conrad has met regularly with committee Democrats over the past couple of weeks to update them on the plan.
His campaign appears to have met with some success, although he has yet to schedule the measure for a markup.
“I think Democrats on the committee are pretty much in agreement on the budget,” said
“Democrats on the committee are pretty much coming together around a common product,” said committee member
Republicans, including Alabama Sen.
Conrad said revenue increases are equal to spending cuts in the latest version of the budget, although that calculation categorizes reduced interest payments on the debt as spending cuts. Conrad said the roughly $2 trillion in spending cuts includes both cuts to government programs and reduced interest payments.
Millionaire Tax Dropped
The plan no longer includes a millionaires surtax, which had appeared in an earlier draft and appealed to Vermont Independent
Latest Conrad Fiscal 2012 Budget Closes Tax Breaks for Savings
Sanders has said he would not support any budget unless it required the wealthiest Americans “to pay their fair share of taxes and unless we do away with loopholes and tax breaks which enable companies making billions of dollars in profits to evade paying any taxes at all.”
In response, Conrad drafted another plan that bumped up revenue and reduced spending cuts, adding a 3 percent millionaires surtax in the process, according to sources.
But the millionaires surtax had the potential to turn off moderates such as
Sanders said Thursday that although he is sorry to see the millionaires surtax go, he is “comfortable” with the current plan because it draws half of its deficit reduction from increased revenue. “I think we have made some significant progress,” he said.
“If we can end a wide variety of loopholes that the wealthy and large corporations benefit from, I can live with not having a millionaires surtax,” he added.
Budget Committee Democrats have been lining up behind the plan, and none has criticized it recently.
Noting that a budget resolution is a blueprint, Cardin said he’s confident that Democrat-led Senate committees will implement its recommendations in a way favorable to the poor.
“How you fill in the blanks will be left to the committees. So we have confidence in the appropriators making sure that the programs that are critical to our most vulnerable are protected and that we invest in education and invest in the necessary infrastructure of this country,” he said.
Cardin added that the document is “very much in line with the Democratic Party’s principles.”
Conrad announced last month that he was delaying the introduction of a budget resolution even though by statute it is supposed to be adopted by April 15. He said he was waiting on a bipartisan group of lawmakers led by Vice President
Conrad announced last month that he was delaying the introduction of a budget resolution even though by statute it is supposed to be adopted by April 15. He said he was waiting on a bipartisan group of lawmakers led by Vice President
While Conrad has been careful to not get ahead of the Biden group, he has left open the possibility of unveiling his plan before the other group reaches an agreement.
“We’ve not reached a conclusion on timing, obviously,” he said. “We made a decision it wouldn’t make a whole lot of sense to go to markup before we see what they do, because they may very well need a budget resolution to enact what they want to do.”