November 21, 2011 in News

Super fail: debt panel gives up

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“As Democrats we brought forward some very tough proposals on issues we care about. We needed the Republicans to come forward on the shared sacrifice part of that, which meant that people who earned over a million dollars a year also put something into this challenge,” said U.S. Sen. Patty Murray, the panel’s co-chair. “That’s the bridge that we couldn’t get across today.”

WASHINGTON — Congress’ supercommittee conceded ignominious defeat Monday in its quest to conquer a government debt that stands at a staggering $15 trillion, unable to overcome deep and enduring political divisions over taxes and spending.

Stock prices plummeted at home and across debt-scarred Europe as the panel ended its brief, secretive existence. Republicans and Democrats alike pointed fingers of blame, maneuvering for political advantage in advance of 2012 elections less than a year away. Both sides agreed action was still required, somehow, and soon.

“Despite our inability to bridge the committee’s significant differences, we end this process united in our belief that the nation’s fiscal crisis must be addressed and that we cannot leave it for the next generation to solve,” the panel’s two co-chairs, Sen. Patty Murray, D-Wash., and Rep. Jeb Hensarling, R-Tex., said in a somber statement.

They added it was not possible to present “any bipartisan agreement” — omitting any reference to the goal of $1.2 trillion in cuts over a decade that had been viewed as a minimum for success.

Under the law that established the committee last summer, failure by the six Republicans and six Democrats to reach a compromise is to trigger about $1 trillion in automatic spending cuts in military and domestic government programs beginning in 2013. In reality, though, it is unclear if any of those reductions will ever take effect, since next year’s presidential and congressional elections have the potential to alter the political landscape before then.

Within minutes, a hail of recriminations erupted.

President Obama said he would veto any congressional attempt to delay the $1.2 trillion in spending cuts automatically triggered by the committee’s failure to reach an agreement.

Senate Majority Leader Harry Reid, D-Nev., said Republicans had “never found the courage to ignore the tea party extremists” and “never came close to meeting us half way.”

But Sen. Pat Toomey, R-Pa., who authored a GOP offer during the talks, said, “Unfortunately, our Democratic colleagues refused to agree to any meaningful deficit reduction without $1 trillion in job-crushing tax increases.”

It was unlikely the outcome would materially improve Congress’ public standing — already well below 20-percent approval in numerous polls.

And the panel’s failure left lawmakers confronting a large and controversial agenda for December, including Obama’s call to extend an expiring payroll tax cut and unemployment benefits. Democrats had wanted to add those items and more to any compromise, and lawmakers in both parties also face a struggle to stave off a threatened 27 percent cut in payments to doctors who treat Medicare patients.

At the White House, President Barack Obama’s press secretary still called for action.

“Instead of pointing fingers and playing the blame game, Congress should act,” said Jay Carney. He said the automatic cuts that would fall on the Pentagon are “deeper than we think is wise,” but he added the administration does not think Congress should undo them. Obama signed the legislation earlier in the year that mandates the cuts as a stopgap in case the committee failed to agree.

Some Republicans said Obama shared the blame for any failure. “It’s amazing to what lengths he will go to avoid making tough decisions,” said Texas Gov. Rick Perry, a GOP White House hopeful.

Based on accounts provided by officials familiar with the talks, it appeared that weeks of private negotiations did nothing to alter a fundamental divide between the two political parties. Before and during the talks, Democrats said they would agree to significant savings from benefit programs like Medicare, Medicaid and Social Security only if Republicans would agree to a hefty dose of higher taxes, including cancellation of Bush-era cuts at upper-income brackets. In contrast, The GOP side said spending, not revenue, was the cause of the government’s chronic budget deficits, and insisted that the tax cuts approved in the previous decade all be made permanent.

The Democrats’ “idea was this was the opportunity to raise taxes,’” said Sen. Jon Kyl of Arizona, the Senate’s second-ranking Republican and a member of the supercommittee. “It didn’t matter what we proposed; the price of that was going to be $1.3 trillion in new taxes,” he added in a CNBC interview, although Democrats made at least two offers that called for smaller amounts of additional tax revenue.

Sen. John Kerry, D-Mass., said on MSNBC, “I have demonstrations outside my office. I’ve had rallies. I’ve had unbelievable amount of pushback because we were ready and prepared to put on the table some of those so-called sacred cows.” Republicans, he said, refused to consider cancellation of the tax cuts for the wealthy.

The talks also were hampered by internal divisions within both parties.

Republicans offered a plan crafted by Sen. Pat Toomey of Pennsylvania about two weeks ago that included an additional $250 billion in tax revenue through an overhaul of the tax code that included reducing the top tax rate from 35 percent to 28 percent. Some Republicans criticized it as a violation of the party’s long-standing pledge not to raise taxes. Even some in the GOP leadership, including Senate Republican Leader Mitch McConnell of Kentucky and House Majority Leader Eric Cantor of Virginia, declined to endorse it in public.

At the same time, Democrats ridiculed it as a tax cut for the rich in disguise — even privately criticizing Sen. Dick Durbin, D-Ill., when he said it could signal a breakthrough — and it failed to generate any momentum toward compromise. Senate Majority Leader Harry Reid, D-Nev., and others also accused Republicans of bowing to the wishes of Grover Norquist, an anti-tax activist whose organization has gathered signatures from GOP candidates on a petition pledging never to raise taxes.

And Democrats had problems of their own. An offer presented by Sen. Max Baucus, D-Mont., to cut about $3 trillion from future deficits failed to win the backing of two of the six committee members of his own party. Officials said they objected because it would have curtailed future cost-of-living increases for Social Security recipients. Some Senate liberals spoke out against the provision in speeches, Baucus jettisoned it from a subsequent offer and Republicans cited that as an example of Democratic intransigence.

The panel’s failure marked the end of an extraordinary yearlong effort by divided government to grapple with budget deficits that lawmakers of both parties and economists of all persuasions agreed were unsustainable.

Negotiations in the Capitol led by Vice President Joseph Biden were followed by an extraordinary round of White House talks in which Obama and House Speaker John Boehner sought a sweeping compromise to cut trillions from future deficits. They outlined a potential accord that would make far-reaching changes in Medicare and other programs, while generating up to $800 billion in higher revenue through an overhaul of the tax code. But in the end, they failed to agree.

By contrast, the supercommittee never came close, instead swapping increasingly small-bore offers that the other side swiftly rejected.

Within the past week, Democrats said they would accept a Republican framework for $400 billion in higher tax revenue and $800 billion or so in spending cuts, while rejecting numerous key proposals.

Late last week, Boehner floated an offer that included $543 billion in spending cuts, fees and other non-tax revenue, as well as $3 billion in tax revenue from closing a special tax break for corporate purchases of private jets. It also assumed $98 billion in reduced interest costs.

It was swiftly rejected.

36 comments on this story so far. Add yours!

IHike4Fun on November 21 at 3:23 p.m.
It was a waste of time to start with. There is no way they could succeed. And to reduce the budget deficit by 1.5 trillion over the next 10 years is a drop in the bucket. Since the debt has grown 1 trillion per year since the current administration took office the deficit would have to be cut by 1 trillion for next year just to break even.
johnclarke on November 21 at 3:25 p.m.
Well well, what a surprise. I don’t know what’s wrong with those democrats, turning down $543 billion in spending cuts, fees and other non-tax revenue, as well as $3 billion in tax revenue from closing a special tax break for corporate purchases of private jets.
I mean, seriously what’s wrong with THAT proposal? Hate to sounds partisan, but the Republicans clearly are not serious about this country and recovery. I say that we take the super stupid committee’s lead, and simply do nothing. Allow the idiotic Bush tax cuts to expire.
Capp70 on November 21 at 3:25 p.m.
I just love the fact that the Repbulicans and Democrats are more worried about if they are getting screwed by each other than doing what is in the best intrest of the country. Which I believe is why we elect them to office in the first place. They need to get off their backsides, and not worry about getting re-elected,and get something done.
lvgpaul on November 21 at 3:33 p.m.
As this country continues in it’s rapid downward spiral, our current dysfuctional Congress will go home for the holidays early, with no concious or care for the needs of the peple who elected them. They all should be ashamed, and voted out.
reservedparking on November 21 at 3:49 p.m.
Well, duh.
RedCedar on November 21 at 3:56 p.m.
It appears we’re now doing Federal budgets the way California’s been handling there budget for years no — a perpetual state of “crisis” with much hyperventilating and draconian predictions by politicians and vested interests, and yet everything appears to plug along just fine. Both parties are focused primarily on creating clever ways to make the enemy party look bad. Meanwhile, the government keeps running on continuing resolutions, which seem to be working just fine.
Is there really any pressing need to re-arrange our spending priorities right now? Treasury bonds are still selling for very high prices, and will continue to do so as long as the EU keeps circling the drain. Perhaps after the next election, one party will win compete control, or both will resign themselves to their fate of having to work together, and they’ll pass a real budget. Or perhaps we just limp along on continuing resolutions until the sh*t really hits the fan. I don’t expect congress to do anything until then, though, because there’s really no upside for them if they do, and there’s considerable downside.
Nobody wants their program cut or their taxes raised. Our congresscritters hear our voice on that, and so they don’t cut programs or raise taxes. “Everything for every one!” as the OWS folks in Seattle put it.
johnclarke on November 21 at 4:01 p.m.
RedCedar on November 21 at 3:56 p.m.
Nobody wants their program cut or their taxes raised.
Soooo I guess you missed all the 1% folks actually lobbying to have their taxes raised? Um, everyone with an IQ over room temp realizes that revenue must be increased. There is this little thing called history that shows what sorts of tax rates work well in this country. Just look back at when the last Democrat was in office.
Shadedmuse on November 21 at 4:03 p.m.
Well I sure as hell saw this comming, because you cant negoiate with a norquist controled tea-bagger who says tax hikes for the wealthy like grover are off the table.
I guess the automatic triggers will kick in and taxes go up automaticly and defense cuts go into play what are draining the cause of debt and deficit.
You want to stop the spending well Iraq and afgansistan show is comming to an end, that should be a major play in debt reduction. now make the rich companies that profited from Bush Wars pay for the Bush wars, starting with Haliburton Black water erik Prince and Dick Cheney.
lowtechmaster on November 21 at 4:10 p.m.
Vote all incumbents, of both parties, out of office. All they want to do is get re-elected and more wealthy!!
Shadedmuse on November 21 at 4:32 p.m.
Just vote out the republican-norquist-tea-baggers like Cathy Mcmo-mo and the crying drunkin tan man from ohio
dataxman on November 21 at 5:02 p.m.
jc - if the 1%’ers want to pay more to Uncle Sam they can write a check. Funny that Buffet complains about taxes yet Berkshire owes over a billion in contested tax. Buffet also donates a huge chunk his money so he doesn’t have to pay estate tax when he dies and is able to lower his current tax bill as he donates appreciated assets.
and I think we should let the Bush tax cuts expire - all of them. Time to get some of the 47%ers out of the wagon and start pulling their weight…
empyrius on November 21 at 5:04 p.m.
Har har har har
Rome burns, politicians fiddle!
Occupy the energy sectors people!
Peace
detroitdude on November 21 at 5:27 p.m.
The first mistake for the GOP was entering into a tax contract with a man named Grover. Trusting ANYTHING that someone named Grover or Raul is foolhardy.
Whatever, bitch and whine, who cares….if anyone really cared, everyone would jump into spending cuts for the DOD. It’s a sacred cow so whatever, please keep protecting us US Government from the boogeyman, Islamist, extremists out there. Good God, get a clue and stop “worrying” about everything, you worry, “they” win.
RedCedar on November 21 at 5:52 p.m.
Okay, JC, I concede that in saying “nobody wants their program cut or taxes raised”, I was employing a rhetorical exaggeration an being statistically inaccurate. Hell, if I said “nobody wants to have a lamp cord hooked up to their testicles and plugged into a wall socket”, I would probably be wrong there too. With 300 million people in this country, you can find one or two who wants anything you imagine.
A more accurate statement would be that the Republicans firmly believe, and the Democrats seriously consider, that raising taxes would be political suicide, while the Democrats firmly believe and the Republicans seriously consider, that cutting programs would be equally suicidal. Yes you can find some outliers who break with their party, and even a few vocal billionaires who say “please raise my taxes”, but that’s not enough to persuade the politicians to break from proven strategy of “everything for everyone.”
Henceforth, JC, I will try to avoid statistically-inaccurate rhetorical exaggerations in our discussions, and will endeavor to keep things quantitatively correct even if that makes them rather vague and dull.
Jethro_toll on November 21 at 6:23 p.m.
Patty Murray couldnt think herself out of a paper sack. I should of laid odds this group of dysfuntionals would have folded.
detroitdude on November 21 at 6:46 p.m.
There is no reason why SS, Medicare, or Medicaid should have been on the chopping block in the first place. The impasse this group of idiots arrived at is ridiculous. Why the meaningless austerity?
No one was serious, Dem or Repub at working on this. If both had been, both would have worked on significant cuts to military spending on a year by year basis.
http://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures
DickAdams on November 21 at 6:58 p.m.
The “debt panel” should simply come out and say, reelect me, and that is the reason for sitting like a lump on a log. Both the dems and repubs on the panel are guilty. I personally point my finger (U know which one) at all of them. Name one these stinking bums that are not acting like weather vanes? Be honest now.
johnclarke on November 21 at 7:07 p.m.
Point taken red cedar. However let us discuss who created the problem and who is blocking any form of a solution. I am mystified as to why the GOP is the Norquist’s collective bitch. All they are doing is handing Obama the election.
selkirks on November 21 at 7:11 p.m.
@detroitdude:
There’s no reason that Social Security, Medicare, and Medicaid should be on the chopping block, indeed. But there are larger structural problems within those programs that cause a lot of fraud and waste. Eliminate the fraud and the waste, and you eliminate the biggest of our problems.
At the same time, the Republicans are morons for failing to recognize the necessity of revenue increases. We need to cut spending and increase revenue. The Concord Coalition is a good bipartisan/nonpartisan resource on this. Spending cuts are necessary. Democrats I think have conceded that. But tax increases are necessary too. And that’s where the Deficit Reduction Supercommittee failed. Because Republicans put their foot down, were stubborn, put their head in the sand—however you want to say it.
johnclarke on November 21 at 7:14 p.m.
Dataxman, i have never quite understood the wingnut obsession with Buffett. He performs like a capitalist but i guess that part that frosts you guys is he plays ball like the Koch brothers but then has the gall to be a liberal. Hard to take, eh?
dataxman on November 21 at 7:26 p.m.
JC - it’s the hypocrisy of Buffet. As for the obsession part, which party names their tax plan after him and trot him out every time they want to raise taxes?
reservedparking on November 21 at 9:47 p.m.
Expanding on my previous post (I was a bit pressed for time):
This was so predictable, it’s almost not even news.
Dazzeetrader11 on November 21 at 10:05 p.m.
Never was going to work. Just another Obama ploy to elected. He KNEW in advance this would lead nowhere. Now he’ll try to blame the usual…predictable as the dark of night.
Just a loser president worried more about his job than anything else. AND he should be. This type of stunt makes him and the Dems look ridiculous.
Glad to see him gone in 12 months. He’ll continuje to blame a tsunami or some such…it’s HIM. Look around you…it’s him. He wants a crash. He might get one too. He needs to go!
BlondeSquawker on November 21 at 10:13 p.m.
Dazzeed and confused: Go to bed now, little girl. Sweet dreems.
http://www.youtube.com/watch?v=2XnY42YJ1AY&feature=related
keithj on November 21 at 10:23 p.m.
Yes it was predictable. Truth is this country is polarized. Half the people think, and half the people mindlessly follow the trickle-down, tea party philosophy. As there is no consensus within the voters, we should not expect there to be a consensus in Congress.
To stop being polarized, either the thinkers need to stop thinking or the mindless followers need to follow an agenda that is good for the country and its people. I don’t see either happening any time soon.
BlondeSquawker on November 21 at 10:39 p.m.
People like DAZEE have no one to blame but themselves for the discourse in America. Get used to another 4 years, DAZEE. You and your ilk wanted this financial stalemate. Congrats. You would have done much better by compromising. Your hate gets in the way of clear thinking.
OBAMA 2012
/There can be no substitutions
meadman on November 21 at 10:57 p.m.
dear dazed…. the fact is Obama is quite a lot smarter than the tea-party-norquist-controlled losers – he knew this would be a failure and he made sure that one of the results of failure was that the Bush tax cuts would be ended…. Obama out-smarted the GOP big-time !!! Now, since orange-man and the GOP (the party of NO) refused to do any compromising (and previously turned down a proposal that included a LOT of what they wanted), they get this instead…hahahahaha –- The GOP just “NO’d” themselves right into the toilet!!!!
selkirks on November 22 at 12:09 a.m.
Not to mention the fact that the GOP candidates are practically giving the election to Obama.
1. You have Mitt Romney, the weathervane.
2. You have Rick Perry, the gaffe extraordinaire.
3. You have Herman Cain, the scandal.
4. You have Michele Bachmann, the crazy lady.
5. You have Rick Santorum, who has no chance.
6. You have Newt Gingrich, the man with five wives. Or whatever it is.
7. You have Ron Paul, who is too libertarian for most.
8. You have Jon Huntsman, who is a formidable candidate but doesn’t have the poll numbers.
There’s just no other option at this point. Obama wins. I’m calling the election now.
Dazzeetrader11 on November 22 at 3:04 a.m.
And you fools have Obama…who is now crying poor even though he and your Dem sissys can’t tighten your belts and have now put the debt over $15 trillion. So, that said, cuts are essential and there will be no tax increase (not one penny) untill the cuts come. Entitlements will kill off the country . Not on my watch. You see, it’s my country too. I don’t want to pay for Obama’s fantasy programs that buy him votes. He’s been without backgroune. Not me…not anyone who’s resonsible. SO whine for you free lunches…soon the cupboards will be bare for you…not me. He has no idea what to do…oh he knows…but he doesn’t want to do it because even you fantasy brained types would hang him. Best wishes…
SO this was just an exercise in nothing. He knew it. He ran the country through this silly exercise knowing full well, it would fail. Now…blame the repubs all you would like, Obama and his Dem friends came on board with a 9 trillion dollar deficit and have added 7 more in 3 years. He’ll crash the country…as predicted. He’s just so simple to figure out. What’s the matter with your liberal brains??? He’s a loser and I hope you follow him over the edge…have fun in your freefall.
Diana on November 22 at 6:15 a.m.
“Obama and his Dem friends came on board with a 9 trillion dollar deficit and have added 7 more in 3 years.” Your numbers are incorrect, but I’ve come to expect that from you.
Well, gee, Daisy. Who did you think was going to pay for two unfunded wars, Medicare Part D and the tax cuts for the wealthy from the Bush administration?
Somebody had to step up and be responsible for the drunken sailor spending of 2000-2008.
Obama 2012
JBlim on November 22 at 6:30 a.m.
Exactly, Diana. Republicans haven’t been good for much of anything lately. Vote ‘em out.
kma on November 22 at 6:34 a.m.
Dizzy Dazz has no idea ever what she is talking about. Calling anyone that doesn’t sink to her level a “fool”. I pitty Dizzy Dazz, as it is hard to believe someone is that tea-bagger repuk gullable. She never has any facts correct, just spews her hatred and propaganda like all her so called candidates running for President.
Romeny now has an ad on TV that is totally false. Romney said President Obama should have been at the “Super Committee” meetings, well dahhhhh Romney he was told not to. I mean it would take hours to say just how dumb these candidates truly are. Newt the toot, told OWS to get a job and take a bath, well, gesh Newt the toot, if they had jobs they wouldn’t have been protesting. Cain, hmmmmmmm, Libya???? What, ummmmmm, let me see….I was just waiting for him to ask where Libya was and to be honest I don’t think he even knows. I think Santa needs to bring him a world map for Christmas, it is obvious he never studied world history in school. What a joke.
Just ignore Dizzy Dazz, she will never get it. I do get a good laugh though and thank her for that.
I agree with Lawrence O’Donnell, glad they failed or we would have had a super committe for everything, not a good precedent to set. All the cuts will happen, so really in reality, it was just a flipping waste of time.
kma on November 22 at 6:36 a.m.
I mean, Dizzy Dazz said it was all the President’s idea for this Super Committee, guess she forgot about her crying, sun tanning boy Boehner.
kma on November 22 at 6:37 a.m.
Sorry, one last comment. Why does Dizzy Dazz want us all to die? Oh, wait, tea-baggers don’t care about people, remember what they said….
JUST LET THEM DIE!!!!!!
johnclarke on November 22 at 7:50 a.m.
dataxman on November 21 at 7:26 p.m.
JC - it’s the hypocrisy of Buffet. As for the obsession part, which party names their tax plan after him and trot him out every time they want to raise taxes?
You’ll have to help me understand what makes Warren Buffett a hypocrite. The only problem I can see from a Con perspective is he votes Democrat. Let’s just agree that he most likely leaves his accounting to his tax attorneys and they handle the law. I pretty much doubt he is involved in his things like his taxes.
What gets “trotted out” is the Bush era capital gains tax dodge for stock dividends. This is adsurd to BLAME Warren Buffett for simply following the law. What, should he just pay more money because he is rich? I thought that would against everything the Cons stand for. Who is the hypocrite?
kma on November 22 at 4:37 p.m.
Dizzy Dazz where are you hon? You come on and speak your crap but then when someone says anything about you……you hide just like your boys, Boehner, Limbaugh, Beck, Annnnnnn (Dan) (Coulter).
Again, I am glad the super boys did not come to an agreement. If they had, then a precedent would have been set, one I don’t want to ever see.
Still have to cut 1.2 trillion from budget…..so nothing lost, except time and those that will blame those as those who were not part of those that were part of those that were part of the Super Committee.
Hope all can try to have a wonderful and fulfilling Thanksgiving. Please try to stop talking, for just one day, about politics. Be with those you love and be thankful for what you have, family, friends, life and this great country.
Happy Thanksgiving to all.