Durbin: Grand bargain odds near 50-50

The odds of a grand bargain on deficit-reduction are less than 50-50, Senate Majority Whip Dick Durbin (D-Ill.) said Wednesday.

Durbin said that the need to raise the nation’s $16.6 trillion debt ceiling this summer will provide an “opportunity” to forge a deficit bargain that raises tax revenue and reforms entitlement, but he gave a relatively pessimistic assessment.

“I think it is less than 50 percent that we get there ,” he told reporters at a Wall Street Journal breakfast.

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The debt ceiling could be a "catalyst" for a deal, and Durbin said he hoped Congress and the White House could avoid the kind of showdown over the debt limit that roiled markets in 2011. 

Durbin, who is close to Obama, said the president is "serious" about getting a deal. 

On a related issue, Durbin announced that he will soon introduce a bipartisan bill to create a Social Security commission tasked with making a report to Congress on how to make that program solvent over 75 years. That report would get fast-track consideration in the House and Senate, he said. 

Republicans have demanded reforms to Medicare and Social Security as part of a deficit-reduction deal, as they argue the two programs account for much of the nation's future red ink.

Durbin said he is personally open to further privatization of Medicare as long a private insurers are forced to “play by the rules” that Medicare uses to lower costs, and that he realizes some of his liberal friends “are not happy” with his position.

If Obama backs cuts to entitlements, Durbin believes enough Democrats would support the president to get a bill through Congress. 

“If a president comes up with a reasonable approach which ends up giving years of solvency to Medicare. ... I think that many Democrats will come around to that position,” he said. Obama’s imprint on the proposal would shield many members from grassroots anger, he said

Obama has repeatedly floated a change to the formula used to calculate entitlement benefits, called the chained consumer price index, as a possible cut. Liberal Democrats in the House and Senate have objected to the proposal. 

“I think chained CPI is a real possibility, only if it crafted in the right way,” Durbin said. The proposal would have to raise the minimum Social Security benefit to the poverty level, and provide the very old with a bump up in benefits, he said. 

Durbin ruled out the kind of "premium support" system for Medicare that House Budget Committee Chairman Paul Ryan (R-Wis.) has proposed.

The majority whip nonetheless endorsed the Senate Democratic budget on the floor this week, which has limited cuts to entitlements and nearly $1 trillion in new tax revenue, as a starting point.

“At least we are moving closer to an opportunity for bargaining,” he said. 

Durbin said he has urged Senate Democrats to come to the table while they can still count on an ally in the White House

“I have said to my liberal friends that they are too short-sighted,” he said. "If we don’t do it now with a Democratic president ... how can we guarantee we will be in a better position later?”

And he emphasized that Obama will not put entitlements on the table until Republicans say that more tax revenue is on the table.

Durbin acknowledged Wednesday that Democrats are at a disadvantage compared to Republicans on reversing the $85 billion in sequestration cuts that went into effect on March 1.

“I think they may be at an advantage at this point by virtue of the fact that first day of sequester came and America is still in business,” he said.

But he said that over the course of the rest of fiscal 2013, GOP members may start to feel the pain of sequestration.

“We almost have to go through a period of experiencing this,” he said.

He said that Appropriations Committee Chairwoman Barbara Mikulski (D-Md.) will be deciding whether to start writing 2014 appropriations bills to the spending level specified by the sequestration cuts. That decision has not been made yet.

For 2014, that number is around $966 billion, more than $20 billion lower than the current level.