Spratt, Domenici: Strong chance Senate Dems, GOP will agree on debt plan

There is a strong chance the Senate this year will craft federal debt-reduction legislation that Democrats and Republicans will support, two former senior lawmakers said Friday.

John Spratt (D-S.C.), a former chairman of the House Budget Committee, told The Hill he thinks the odds for the Senate crafting "something of consequence this year" are around "50 or 60 percent."

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The likelihood of the chamber cobbling together a bipartisan debt-reduction bill are “as good now as they have been for a long time,” Spratt said.

Pete Domenici (R-N.M.), a former Senate Budget Committee chairman, said earlier, during a forum on Capitol Hill, that he believes “the Senate will probably do something bipartisan” to get the debt-trimming ball rolling.

Asked after his remarks if he was referring to a plan being included in a 2011 continuing resolution to fund the federal government, Domenici said: “No, something broader. Much broader.”

Their comments came during a forum on defense budget cuts sponsored by the Bipartisan Policy Center and the Stimson Center.

Domenici painted a bleak picture of the nation’s finances, noting Washington’s debt-to-GDP ratio is dangerously high.

He called comparisons to the World War II years inaccurate, noting at that time the American public owned the vast amount of the nation’s debt. Most of Washington’s current debt is owned by other nations, especially China, Domenici said.

Congress must act soon, he said, “because I don’t think we’ll get a warning” should Chinese leaders “one day change their minds about the United States.”

Spratt said factors are coalescing that should bring key senators to the table.

“There is gathering momentum,” Spratt said. “Now, you need vehicles for implementation. … The debt-ceiling vote is such an opportunity.”

While in Congress, both were considered allies of the military and defense sector. During Friday’s forum, both called for defense and domestic spending reductions to right the nation’s fiscal ship.

“The U.S. military is a positive force in the world,” Domenici said. “But if you’re going to do a real [debt-paring] package, defense has to be a part of it.”

Spratt said while he was on the House Budget Committee “we were always told that defense spending at 3 percent or 3.5 percent of GDP was adequate.” He then said the Congressional Budget Office (CBO) pegged the Pentagon’s fiscal 2011 request at “4.7 percent of GDP.”

A healthy economy “is the first instrument of defense,” Spratt said.

Gordon Adams, who oversaw defense budgeting at the Office of Management and Budget (OMB) during the Clinton administration, said that a defense “build-down” — which includes smaller annual budgets — is already under way.

Will this Congress look to the Pentagon budget as it tries to pay down some of the nation’s debt?

David Berteau, a former Pentagon official now with the Center for Strategic and International Studies (CSIS), said “it is not yet clear that the votes are there in Congress for a major [defense] build-down.”

But “we can see a point where that could happen,” he said. That moment should occur after the wars in Iraq and Afghanistan are essentially over and most U.S. troops are not engaged in combat, Berteau said.

Will the Pentagon play ball or fight back should the rest of Washington conclude the Pentagon budget should contribute to debt-reduction efforts?

During a meeting last year with defense analysts, Defense Secretary Robert Gates said he “was not ready to concede” that the defense budget should be trimmed to reduce debt, Berteau said.

The Defense Department likely will struggle with declining budgets, according to Adams and Michael Bayer, until recently the chairman of the influential Defense Business Board. There “might be two or three generals left in the Pentagon,” Bayer said, “who dealt with a down budget.”

The current crop of generals might not have experience guiding the DoD budget on a downward slope, those experts said, but they — and their civilian counterparts — know what’s likely ahead: fewer dollars.

“There is a changing nature of the debate within DoD,” Berteau said. “The senior leadership knows that trouble is coming.”