By Erik Wasson and Russell Berman - 11/02/11 01:03 AM EDT
The 12 members of the congressional deficit supercommittee entered the “critical final phase” of negotiations on Tuesday with a blast from the past: a hearing devoted to examining a pair of debt plans released nearly a year ago.
Three weeks before its Nov. 23 deadline, the debt panel heard three hours of testimony from the leaders of the president’s 2010 fiscal commission, Erskine Bowles (D) and former Sen. Alan Simpson (R-Wyo.), and the co-chairmen of an outside committee, Alice Rivlin (D) and former Sen. Pete Domenici (R-N.M.).
“I have great respect for you all individually, but collectively I am worried you are going to fail, fail the country,” Bowles, a former chief of staff to President Clinton, told the lawmakers.
His blunt warning came amid widespread skepticism in Washington that the supercommittee will be able to overcome the partisan divide and strike a deal.
Bowles later provided what might have been the hearing’s most surprising moment: his own proposal for a $2.6 trillion deal based on back-of-the-envelope calculations combining offers that committee Democrats and Republicans made in the last week.
His proposal, which combined entitlement reforms, discretionary spending cuts and $800 billion in new tax revenues, brought smiles to the faces of the committee members, along with warnings against relying on dollar figures reported in the press.
“You can’t take the press accounts of some of those numbers, so it doesn’t reflect the reality,” Sen. John KerryJohn KerryAn all-female ticket? Not in 2016 GOP senator calls for China to crack down on illegal opioid Obamas to live in home of former Clinton press secretary: report MORE (D-Mass.) told The Hill as he left the hearing.
Still, the members of the debt panel said they continue to seek a grand bargain that would go beyond the group’s mandate to find $1.2 trillion in savings by Nov. 23.
With just three weeks to go before a plan is due, committee members indicated they remain willing to discuss a partial conversion of Medicare to a voucher program and overhaul of the tax code.
The group’s aim appears to be giving detailed instructions to Congress to complete the reforms next year.
Behind the scenes, however, some members of the supercommittee have been meeting to find out whether a smaller backup deal is possible in case the group is unable to bridge the yawning gap over taxes needed for a bigger deal.
Sen. Patty MurrayPatty MurraySenate backs equal pay for female soccer players Feds can learn lessons from states about using data to inform policy Lawmakers blast poultry, meat industries over worker injuries MORE (Wash.), the committee’s Democratic co-chairman, said at the Tuesday hearing that she is continuing to seek a deal that would include spending and entitlement cuts as well as tax revenue, even as the Nov. 23 deadline for the 12-member group looms.
“We are now entering the critical final phase of this process,” Murray said. She said Democrats have “made clear” they are prepared to compromise.
“We’ve said we are very open to painful concessions and compromises if Republicans are as well — and we have put forward serious ideas that reflect that,” she said.
Rep. Jeb Hensarling (Texas), the GOP co-chairman of the supercommittee, also said that the group has a duty to go beyond its target.
Democrats and Republicans on the panel exchanged proposals last week that would exceed the $1.2 trillion minimum, but rejected each other’s offers. Republicans object to any new taxes in a deal, while Democrats balk at larger entitlement cuts, especially in the absence of tax hikes.
Bowles’s plan would split the difference between the GOP and Democratic offers on spending and use the $800 billion revenue ceiling Speaker John BoehnerJohn BoehnerHouse GOP faces dilemma on spending bills Overnight Finance: Puerto Rico bill clears panel | IRS chief vows to finish term | Bill would require nominees to release tax returns Overnight Defense: Pentagon chief fears sequestration's return MORE (R-Ohio) talked about with President Obama over the summer.
In total, a $2.6 trillion Bowles compromise would have $300 billion in new discretionary cuts, $300 billion in mandatory cuts, $200 billion from changing the calculation for inflation for Social Security and Medicare and $600 billion in healthcare reforms, including an increase in the eligibility age for Medicare.
The committee members were largely mum on Bowles’s proposal.
“We are happy to listen to anybody’s recommendation,” Murray told reporters as she darted into an elevator. Asked if Bowles had the numbers right, she laughed and declined comment.
As the deadline nears, pressure on the supercommittee from interest groups is increasing. A half-dozen volunteers from AARP sat in red shirts during the hearing.
“Our message to the supercommittee members today is this: No cuts to Medicare or Social Security benefits,” AARP’s senior vice president for government affairs, Joyce Rogers, said in a news release. “Voters deserve a national conversation about health and retirement security, not a political deal that cuts the benefits they’ve earned.”
Medicare reform became a major focus on the hearing after Rivlin, a former budget director, and Domenici pushed their plan for partial privatization.
“Any plan that does not fundamentally restructure Medicare and the other health entitlements will fail to adequately address the debt crisis we face,” Domenici said.