CQ TODAY ONLINE NEWS
Oct. 13, 2011 – 11:06 p.m.
Undaunted, Democrats Push Revenue Raisers
By Joseph J.Schatz and Frances Symes, CQ Staff
House Democrats, ceding little public ground to Republicans, are urging the new joint deficit reduction committee to raise revenue, protect most programs from big cuts and focus on job creation.
Citing public support for a budget-savings plan that includes revenue increases, House Democrats seem to be on the same page as Senate Democrats and President Obama in urging a “big, bold and balanced” approach, outlined Thursday in 16 letters from the Democratic ranking members on standing House committees.
“Respected economists and other budget experts agree that a fair mixture of growth, savings and revenues is needed, with everyone contributing their fair share,” said House Minority Leader
Yet, although House Democrats make up a fourth of the deficit reduction committee, they may have limited leverage, if the summer debt ceiling negotiations are an indicator. Republicans have been united in opposition to tax increases, and Obama angered House liberals by conceding significant ground to the GOP on the debt ceiling agreement in late July.
For their part, many Senate Democrats are considered vulnerable in next year’s election and may be not be as supportive of the kind of tax increases envisioned by the most liberal House Democrats.
Without the specter of a government default, House Democrats may feel less urgency to support the president if they fear that a compromise might veer too far from their goals. Many House Democrats refused to give Speaker
Effect May Be Limited
Given that the joint committee has been keeping its deliberations almost entirely under wraps, it remains unclear what might be the effect of recommendations from House Democrats or from other lawmakers not on the panel.
Regardless, Ways and Means Democrats stuck to their long-standing principles in their submissions to the joint committee. They made clear that they do not support any cuts to entitlement programs beyond changes that build on the 2010 health care overhaul (PL 111-148, PL 111-152) — changes that most Republicans are unlikely to support.
In addition, Ways and Means Democrats insisted that any comprehensive overhaul of the tax code must not be “revenue- neutral” but rather must result in an increase in receipts. They opposed the use of “dynamic scoring,” a method of analyzing budgetary changes favored by some Republicans that would anticipate faster economic growth and bigger receipts as a result of tax cuts. The Ways and Means letter did not say, however, what stance Democrats might take if the committee decides to pursue an overhaul of the corporate tax code without touching individual rates.
In a letter to the Republican and Democratic co-chairmen of the deficit committee, Pelosi stressed her party’s oft-stated position that the panel’s recommendations should include a mixture of spending cuts and new revenue and that it should make job creation one of its goals.
And although House Democrats made a coordinated plea to the joint committee, many House Republican committee chairmen have said they will not send official proposals to the deficit committee, choosing instead to make less formal recommendations. House Armed Services Committee Republicans did, however, send their own recommendations to the joint committee on Thursday, warning against further military cutbacks much as the panel’s Democrats did.
The House and Senate Agriculture panels will jointly recommend $23 billion in spending cuts, according to the House committee’s chairman
Undaunted, Democrats Push Revenue Raisers
Some Senate committees, including the Budget Committee and the Environment and Public Works panel, are working in a bipartisan fashion. Finance Committee Republicans are working on partisan recommendations.
The letters released Thursday by House Democrats represent a wide range of viewpoints and approaches to the deficit reduction effort that, in most cases, echoed the party’s long-standing legislative goals and sought to protect programs they champion.
In their letters to the joint committee, some Democrats outlined priorities or issued warnings about potential cuts, while others offered details and identified specific savings they said should be considered.
Education and the Workforce Committee Democrats pressed for job-creation measures while including one specific savings recommendation: tightened enforcement against workers who are illegally misclassified as independent contractors instead of employees. That move reduced tax withholding and results in a yearly estimated tax gap of $54 billion.
Others pushed for the protection of entitlement programs, with Energy and Commerce Democrats urging the committee not to “pursue policies that would undermine coverage for Medicare, Medicaid, or people who will enroll in health insurance exchanges.” The panel’s Democrats conceded that “it is possible to identify areas where Medicare and Medicaid overspend” but stressed that the joint committee “should discard proposals that would increase beneficiaries’ premiums or cost-sharing and that would reduce their benefits.”
Financial Services Democrats, led by
Appropriations Committee ranking Democrat
The automatic spending cuts that were established by the debt limit law (PL 112-25) were intended to provide a strong incentive for the joint committee and Congress to meet the deficit reduction target. The cuts, which would take effect in January 2013 if Congress did not meet the target, would affect some top GOP priorities, particularly defense spending.
Lauren Smith, Geof Koss, Richard E. Cohen and Ellyn Ferguson contributed to this story.