The congressional fiscal super committee that is tasked with crafting a deficit reduction package of at least $1.5 trillion met today with the architects of the Bowles-Simpson and Rivlin-Domenici deficit reduction plans. Both Democrats and Republicans have recently released their initial offers to the super committee, which seems no nearer to cutting a final deal than it did when it was first formed.
As Igor Volsky noted earlier this week, the plan that the Democratic members of the super committee released is well to the right of bipartisan plans like Bowles-Simpson or the plan crafted by the Senate’s Gang of Six (both of which included unnecessary cuts to vital programs). In fact, the Democrats’ plan has about six dollars in spending cuts for every dollar in new revenue (while Bowles-Simpson had a two to one ratio).
The Republicans, meanwhile, released a “deficit reduction” plan that, depending on the revenue baseline assumed by both Bowles-Simpson and the Gang of Six, would cut taxes to the tune of more than $800 billion over 10 years, according to the Center on Budget and Policy Priorities:
The new Republican plan provides for slightly more than $3 trillion in deficit reduction over the next ten years, relative to a current-policy baseline that assumes extension of all the 2001-2003 tax cuts. (See Table 1.) Of that amount, only about 1 percent of the deficit reduction ($40 billion) stems from revenue increases. And, compared to the “plausible baseline” that the Bowles-Simpson Fiscal Commission and the Senate’s Gang of Six used, which assumes expiration of the upper-income tax cuts, the latest Republican plan actually provides for tax cuts of more than $800 billion over ten years.
Overall, “the Republican plan would produce $1 trillion less deficit reduction than the Democratic offer, relative to any baseline.” The Republicans, in their zeal to indiscriminately reduce taxes regardless of the country’s ability to afford it, evidently believe that no deficit reduction plan is complete without blowing a new hole in the federal budget.