Sen. Bob Corker (R-TN) believes Senate Republicans would be open to increasing revenue through tax reform as part of a “grand bargain” to reduce the deficit. During an appearance on Fox News Sunday, Corker argued that entitlement reform should be a top priority, but left the door open to reaching bipartisan consensus on deficit reduction in the next few months.

In past negotiations, the GOP leadership has repeatedly walked away from the table due to unwillingness to reach an agreement that included more revenue and, since the fiscal cliff deal, Republican leaders have insisted that the “the discussion about revenue … is over.”

Host Chris Wallace asked whether Corker and his party would be open to a compromise that include tax increases:

CORKER: I think there–by the way–is a chance on a deal. I know the president is saying the right things and we have an opportunity over the next four-to-five months. I think that we’ll know when the president is serious by virtue of a process is setup where he is actually at the table or he has a designee and whether he begins to say publicly to the American people, to all Americans, that he understands that Americans are only paying one-third of the cost of Medicare and that has to change for the program to be here down the road. But look, Chris, I think Republicans — if they saw true entitlement reform — would be glad to look at tax reform that generates additional revenues. And that doesn’t mean increasing rates, that means closing loopholes. That also means arranging our tax system so that we have economic growth. And I think we’ve been saying that from day one.

Sen. Assistant Majority Leader Dick Durbin (D-IL), also on the program, praised Corker’s comments as “honest and constructive,” and noted that the savings need to be done in a way that does not obliterate the system, as would be the case in the “Paul Ryan voucher approach.”

Corker is exaggerating the problems facing the Medicare program. According to the program’s 2012 annual trustee’s report, Medicare’s dedicated revenue fully pays for its costs and will do so until at least 2024. Even then, revenue will cover 87 percent of Medicare costs. At the current pace, by 2086, revenue would only be sufficient to cover 69 percent of costs — but even that 75-year figure would be more than two-thirds of the program’s costs.

The Affordable Care Act both reduced the costs of Medicare by hundreds of billions and improved its coverage for seniors. He has also recommended specific reforms that would save $57 billion annually from Medicare (more even than recommended by the Bowles-Simpson commission) and hundreds of billions in entitlement savings overall.

The Federal Reserve — which has a dual mandate to ensure price stability and maximum employment — recently adopted an explicit target for the labor market, saying it will not end its efforts to boost the economy until unemployment is around 6.5 percent. Members of the Federal Reserve Board and economists had been pushing for the central bank to adopt such a target in light of the fact that unemployment was staying stubbornly high while inflation wasn’t increasing.

But some GOP senators want the Fed to toss aside the employment part of its mandate and focus exclusively on inflation:

Sen. Bob Corker (R-Tenn.) said Monday that he and Sen. David Vitter (R-La.) were introducing a bill to make it clear that the Federal Reserve should focus on a single mandate — stabilizing prices by keeping inflation low.

On the Senate floor Monday, Corker said the Federal Reserve Single Mandate Act would reestablish price stability as the Federal Reserve’s single mandate rather than also having the Fed work on reducing unemployment.

“Providing the Fed with a clear and explicit focus on keeping inflation low will serve America better than the broad, bipolar mandate it has today,” Corker said. “The dual mandate blurs the line between fiscal and monetary policy and allows Congress to shirk its responsibility to enact sound budgets and policies that produce economic growth.”

This has been an idea Republicans have floated a few times in recent years. But doing so would remove the one big lever left to combat joblessness, since the GOP has made it abundantly clear that Congress will not be engaging in any fiscal stimulus any time soon.

As Federal Reserve Chairman Ben Bernanke explained when defending the Fed’s recent efforts, “The conditions now prevailing in the job market represent an enormous waste of human and economic potential…Meanwhile, apart from some temporarily fluctuations, largely reflected swings in energy prices, inflation has remained tame…Against a macro economic backdrop that includes both high unemployment and subdued inflation, the FOMC will maintain its highly accommodative policy.” But the GOP would prefer that the Fed continue to fixate on non-existent inflation, at the expense of the unemployed.

Less than a day after President Obama announced that he is re-nominating Richard Cordray to be director of the Consumer Financial Protection Bureau (CFPB), Republicans suggested that they again intend to obstruct his nomination based on their continued opposition to having a strong independent agency protecting consumers from predatory lending practices. Cordray’s recess appointment is set to expire at the end of 2013, unless the Senate confirms him.

Nearly every Senate Republican voted against the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which established the independent bureau. In 2011, 45 Republicans filibustered Cordray’s nomination, denying him an up-or-down vote, based on their objection to the agency itself. In a May 2011 letter, the Republican Senators made it clear that they would not allow a vote on any nominee unless the CFPB was first drastically restructured and weakened — though they did not attack the former Ohio Attorney General Cordray’s qualifications.

Though President Obama comfortably won re-election and Senate Democrats expanded their Senate majority to 55 seats in November, just 41 members of the Republican majority can again prevent Cordray from even getting a confirmation vote. It appears that might be a challenge, as:

• Sen. Mike Crapo (R-ID), who is likely to be the top Republican on the Committee on Banking, Housing and Urban Affairs, said in a statement: “Today’s decision to re-nominate Richard Cordray to be Director of the Consumer Financial Protection Bureau after using an unconstitutional recess appointment is premature, given the outstanding concerns about the bureau and the legal challenge to the recess appointment. Until key structural changes are made to the bureau to ensure accountability and transparency, I will continue my opposition to any nominee for director, as outlined in a letter signed by 45 Republican Senators to the president.”
• Sen. Richard Shelby (R-AL), the outgoing Ranking Member on the Committee on Banking, Housing and Urban Affairs, through a spokesman said he has “not changed his position” since 2011.
• Sen. Bob Corker (R-TN), a member of the Committee on Banking, Housing and Urban Affairs, said in a statement: “While I respect Richard Cordray as a substantive person who has shown thoughtfulness in writing regulation up to now, I still have reservations about the CFPB’s structure, namely the lack of a board to help ensure sound policy and accountability, and I look forward to discussing with him how to address those concerns.”
• Rep. Jeb Hensarling (R-TX), chairman of the House Committee on Financial Services, said in a statement: “The Dodd-Frank Act places vast, unprecedented and unchecked power completely in the hands of a single person. The CFPB director has the power to decide whether American families can obtain a mortgage, get a car loan or even get a credit card. My hope is that the decision to renominate Mr. Cordray will open the debate about whether some common sense checks and balances will be placed on a massive bureaucracy that is now totally unaccountable to the American people.”

Despite the GOP’s reservations, the Cordray’s CFPB has been a great success, cleaning up the mortgage servicing industry, winning refunds for credit card customers, and preventing wrongful foreclosures. The fears of the industry proved baseless, as Cordray has earned praise for working with banks, credit unions, and consumer groups.

Two Republican senators want to use the threat of an economic meltdown to raise the retirement age and cut Medicare. Sens. Bob Corker (R-TN) and Lamar Alexander (R-TN) introduced a plan today that would raise the federal debt limit by $1 trillion in exchange for $1 trillion in cuts to Medicare, Medicaid, and Social Security, as The Hill reported:

The Corker-Alexander dollar-for-dollar plan has several components.

It would structurally reform Medicare by creating competing private options giving seniors greater choice of healthcare plans. It would not, however, cap Medicare spending.

The plan would also give states more flexibility to manage Medicaid programs and prevent states from “gaming the federal share of the program with state tax charges.”

It would gradually raise the Social Security retirement age and use the “chained CPI” formula to calculate cost-of-living adjustments, curbing the growing cost of benefits.

In exchange, it would direct the debt limit be increased by the same amount as the savings generated from entitlement reform.

The U.S. will hit its debt limit on or around December 31st. The Treasury Department estimates that, using extraordinary measures, it could avoid default for another two months or so. Allowing the U.S. to default on its debt via not raising the debt ceiling could cause a complete financial meltdown. The 2011 debt ceiling debacle — during which House Republicans nearly pushed the country into a default due to their intransigence on taxes — cost the country about $19 billion in higher interest payments and at least one million jobs.

Corker and Alexander are threatening more economic chaos in order to achieve one of the most regressive potential policy changes. Though lawmakers point to America’s increasing life expectancy in order to justify raising the retirement age, life expectancy is only increasing for wealthier workers in non-physical jobs. As the Center for Economic and Policy Research put it, “there has been a sharp rise in inequality in life expectancy by income over the last three decades that mirrors the growth in inequality in income.”

On Sunday, Sen. Bob Corker (R-TN) conceded that Democrats have won the debate on raising taxes on the richest Americans and said that he would likely vote to increase rates on the top 2 percent of Americans in order to shift the debate to cutting entitlement programs and improve the GOP’s leverage in the debate over how to avert the so-called fiscal cliff.

During an appearance on Fox News Sunday, Corker explained that if Republicans “give Obama a 2 percent increase,” the party can then hold the debt ceiling hostage in order to secure real cuts in spending:

CORKER: The Republicans know they have the debt ceiling, that is coming up around the corner, and, the leverage is going to shift, as soon as we get beyond this issue. The leverage is going to shift, to our side where hopefully we’ll do the same thing we did last time and that is if the president wants to raise the debt limit by $2 trillion we get $2 trillion in spending reduction and, hopefully, this time, it is mostly oriented towards entitlement and with no process. [...]

[Obama] has the upper hand on taxes and you have to pass something to keep it from happening. We only have one body. If we were to pass, for instance, raising the top 2 rates, and that’s it, all of a sudden we do have the leverage of the debt ceiling and we haven’t given that up so the only way the debt ceiling.

House Speaker John Boehner (R-OH) has indicated that the GOP plans to use that leverage by demanding more spending cuts, but the move will result in great economic costs. In 2011, Republican demands nearly led to a credit default and ultimately cost taxpayers “$18.9 billion over 10 years, due to elevated interest rates between January and August 2011.”

Obama slammed the GOP’s strategy during a meeting with business leaders last week. “The thinking is the Republicans will have more leverage because there will be another vote on the debt ceiling, and we will try to extract more concessions with a stronger hand on the debt ceiling,” Obama told members of the Business Roundtable. “That is a bad strategy for America, it’s a bad strategy for your businesses, and it is not a game that I will play.”

During an appearance on Meet The Press Sunday morning, Sen. Bob Corker (R-TN) repeatedly dodged host David Gregory’s questions on whether or not he would be willing to accept increases on the wealthiest Americans’ tax rates in a deal to prevent the nation from going over the so-called “fiscal cliff.”

Instead, Corker referred to his own recently-proposed plan to raise revenue through closing tax loopholes. When pressed by Gregory on whether this would be the only revenue source that he would consider in a deal, he replied that revenues through capping deductions and eliminating loopholes would be a more “pro-growth” approach, but conspicuously did not rule out a rate hike on wealthier Americans’ marginal tax rates:

CORKER: Look, Speaker Boehner and Leader McConnell both have put revenues on the table.

DAVID GREGORY (HOST): Let’s just understand. Everybody in Washington says revenues. There’s increasing your tax rates and there’s finding other ways to raise tax revenue. And the distinction is important, because what republicans object to is raising your tax rates — Your actual marginal tax rates. That’s the distinction that you have to answer, right?

CORKER: Well, you can get there two ways. One of the ways is the way I proposed, which is closing loopholes. That’s a pro-growth way of getting more revenues from wealthy Americans. And I think, David, before this is all over with, there’s lots of machinations. There’s capital gains, dividends. And I think cooler heads will prevail. And I think we will resolve this. And that’s the very best thing we can do to get our economy going.

Republicans have been generally vague in outlining an acceptable compromise on Americans’ tax rates.

But an increasing number of GOP lawmakers have been backing away from absolutist dogma on increasing the wealthiest Americans’ tax rates in a deal with President Obama. Recently, prominent GOP senators such as Sen. Roy Blunt (R-MO) have signaled that they are open to increasing taxes in order to avert the “fiscal cliff.”

Last week, Corker also backed away from anti-tax purist Grover Norquist’s pledge to not raise taxes under any circumstances, asserting, “I am not obligated on the pledge.”