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Debt Commission Report Flops With Elected Officials, So The President Shouldn’t Feel Bound To It

Today, President Obama’s fiscal commission failed to approve its final proposal, with the report garnering the votes of 11 of the 18 commission members, while needing 14 to advance. However, some of the commission members are making a concerted effort to move the goalposts and spin the commission’s failure to achieve consensus as a victory.

“11 of 18 by my math is 60 percent,” said Sen. Kent Conrad (D-ND) during the commission’s meeting. “In the United States Senate, when you’re facing a filibuster even, 60 percent prevails. So I believe we’ve crossed an important hurdle here and laid out a plan that will be resurrected because it must be.”

Both Conrad and Incoming House Budget Committee Chairman Paul Ryan (R-WI) said that they would place parts of the plan into the next national budget, while President Obama today released a statement saying that, “The Commission’s majority report includes a number of specific proposals that I — along with my economic team — will study closely in the coming weeks as we develop our budget and our priorities for the coming year.”

But if the point of the commission was to craft a proposal that could actually pass Congress, the fact that it received 11 votes doesn’t mean that it achieved some miraculous bipartisan consensus. Of those 11, 5 were unelected, appointed members, who will not receive a vote in Congress. Another two yes votes came from elected officials who are leaving Congress — Sen. Judd Gregg (R-NH) is retiring, while Rep. John Spratt (D-SC) was defeated in November.

That leaves just four members of the incoming 112th Congress that approved of the plan. So:

Amongst elected members of Congress, the vote was 6-6.

Amongst elected members of the incoming 112th Congress, the vote was 4-6 AGAINST the plan. Yea: Sens. Kent Conrad (D-ND), Dick Durbin (D-IL), Tom Coburn (R-OK), and Mike Crapo (R-ID); Nay: Sen. Max Baucus (D-MT), Reps. Jan Schakowsky (D-IL), Xavier Becerra (D-CA), Paul Ryan (R-WI), Jeb Hensarling (R-TX) and Dave Camp (R-MI).

Every member of the House that will be back for the 112th Congress voted AGAINST the plan.

Plus, Sen. Dick Durbin (D-IL) clearly said during the commission’s meeting that if this exact plan were on the Senate floor, he would vote against it. The point of including a supermajority requirement was to demonstrate that a plan could receive wide approval from both parties. Obviously, the nay votes were cast by both progressives and conservatives for a variety of reasons, but if the goal was to craft something that had an actual chance of passing through Congress with bipartisan support, the plan fell far short.

At this point, the idea of outsourcing comprehensive deficit reduction to a commission was tried, without success, and the President shouldn’t feel beholden to including big elements of the commission’s plan in his budget. There are other plans out there — like Rep. Jan Schakowsky’s (D-IL) — that should be taken just as seriously, as they also balance the budget, without relying on the conservative frame that the debt commission’s co-chairs decided upon.

Republicans Claim Lousy Jobs Report Means Bush Tax Cuts For The Rich Must be Extended

Today’s jobs report from the Bureau of Labor Statistics paints an ugly picture of lackluster job creation and increasing long-term unemployment. The Federal Reserve — which is taking its own steps to boost employment after dithering for months — has been reduced to pleading with Congress for further fiscal stimulus, in the hopes of averting an even longer jobs slog.

So, naturally, Congress is spending the day debating whether or not the richest two percent of Americans should receive a tax cut (in addition to the tax cut they will receive on their first $250,000 in income if, as everyone in Congress wants, tax rates are extended for the lower- and middle-classes). In fact, many House Republicans are claiming that the richest two percent of Americans desperately need a tax cut because of the bad jobs report:

House Minority Leader John Boehner (R-OH): Any sign of job growth in this struggling economy is encouraging, but clearly no match for the uncertainty families and small businesses are facing, which is why we must cut spending and stop all the looming tax hikes.

House Minority Whip Eric Cantor (R-VA): Today’s jobs report marks the 19th consecutive month in which unemployment has exceeded nine percent — an unacceptable result. We must do everything possible to bring that number down and get people back to work by ending the uncertainty that is plaguing the private sector. To start, Congress should reassure job creators and investors by taking the impending tax hikes off the table.

Rep. Mike Pence (R-IN): Today’s heartbreaking unemployment report should be yet another wake-up call to Democrats that raising taxes in the middle of the worst economy in 25 years is a mistake. Higher taxes on America’s small businesses won’t get anyone hired. I call on Washington Democrats to abandon their plan to raise taxes on small businesses and get America back to work.

Rep. Tom Price (R-GA): Nationwide, the unemployment rate has stayed at 9.4 percent or higher for 19 straight months. Yet instead of sensible policies to encourage private sector job creation, Democrats have pushed one job-killing idea after another…Well, higher taxes don’t hire Americans.

Sens. Mitch McConnell (R-KY) and Orrin Hatch (R-UT) took this line of thinking to the Senate floor today. Watch it:

Of course, there was no attempt on the part of these Republicans to grapple with the fact that the Bush tax cuts ushered in the weakest period of job growth in the post-war period, or that the Congressional Budget Office ranks extending the Bush tax cuts as the least effective tax measure for promoting economic growth.

As former Reagan budget director David Stockman said, today’s GOP has succumbed to the “theology” of tax cuts: “After 1985, the Republican Party adopted the idea that tax cuts can solve the whole problem, and that therefore in the future, deficits didn’t matter and tax cuts would be the solution of first, second, and third resort.”

Fed Pleads For Fiscal Stimulus, As Job Growth Stagnates And Jobless Benefits Expire

Today, the Bureau of Labor Statistics released a sobering update of the nation’s unemployment situation. Just 39,000 jobs were created last month — after economists predicted 145,000 — and the unemployment rate edged up to 9.8 percent. This level of job creation isn’t even enough to keep up with the growth of those joining the labor force, never mind bring down the unemployment rate. The wider U-6 measure of underemployment stands at 17 percent. Here’s the chart from Calculated Risk:

One of the most distressing stats is that 41.9 percent of the unemployed have been out of work for at least six months. Even with that many people in the ranks of the long-term unemployed, Congress has been unable to extend unemployment benefits, meaning millions of Americans will fall through the last strands of the social safety net in the midst of the holiday season. The expiration of benefits will also reduce economic growth, possibly by as much as one percentage point.

The prospects for additional job creation measures is also very dim, unless a few tax provisions squeak through as part of an unseemly “compromise” that also extends all of the Bush-era tax rates. But the jobs crisis has gotten so bad, that even the Federal Reserve — which has embarked on its own series of steps to boost economic growth, after sitting on its hands for months — is pleading for more fiscal stimulus. First, Chairman Ben Bernanke:

The Federal Reserve is nonpartisan and does not make recommendations regarding specific tax and spending programs. However, in general terms, a fiscal program that combines near-term measures to enhance growth with strong, confidence-inducing steps to reduce longer-term structural deficits would be an important complement to the policies of the Federal Reserve.

And Fed Vice-Chairman Janet Yellen:

We need, and I believe there is scope for, an approach to fiscal policy that puts in place a well-timed and credible plan to bring deficits down to sustainable levels over the medium and long terms while also addressing the economy’s short-term needs.

Instead, Congress is consumed with figuring out for how long the richest two percent of Americans should receive a tax cut above and beyond those received by everyone else.

Update

Felix Salmon has more:

[T]he elected branches of government are making things worse rather than better: 2 million of the long-term unemployed lost their federal emergency unemployment aid on Tuesday, and Republicans in Congress are much more interested in a $700 billion scheme to extend tax cuts for people earning more than $250,000 a year than they are in providing some kind of social safety net for people who have been out of work for more than six months.

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