The co-chairmen of President Obama’s bipartisan fiscal reform commission are calling on lawmakers and the White House to raise the country’s debt ceiling in exchange for $2 trillion in deficit savings over the next decade.
In an op-ed published on The Hill’s Web site Monday afternoon, former senator Alan Simpson (R-Wyo.) and former Clinton White House chief of staff Erskine Bowles said that Congress and the Obama administration should agree to a “down payment” of at least $2 trillion on a broader $4 trillion deficit-reduction plan to begin tackling the country’s ballooning debt.
“What this country needs -- and what the American people deserve -- is a $4 trillion-plus, gimmick-free fiscal consolidation package that stabilizes and then reduces our debt as a share of the economy,” Simpson and Bowles said.
They acknowledge, however that “this is a tall order” and that it would be difficult for the parties to agree on a deal before Aug. 2. That is the deadline for Congress to raise the country’s borrowing limit or allow the nation to default on its debt.
”Given that, a two-part approach seems sensible, where policymakers agree to a large down payment now and follow it with more significant and structural reforms in the near future,” the co-chairmen said. “For this to work, though, the down payment must be large -- in the vicinity of $2 trillion -- and it must at least begin to address entitlement growth.”
Bowles and Simpson also suggested that lawmakers and the White House should complete the deficit-reduction plan before the November 2012 election, as “elections take all options off the table, instead of setting the table for reform.”
Congress has only five weeks before the default deadline, and working out a comprehensive deal in two steps would be a realistic alternative to attempting to tackle it all at once.
But there’s already little appetite for a debt-limit vote as it is – and many lawmakers would balk at the prospect of voting twice on a package.
Over the past two months, members of Vice President Biden’s bipartisan working group made progress on identifying significant deficit savings. But Republicans pulled out of the talks late last week, citing an impasse on tax increases. The White House has proposed nearly $1 trillion in cuts to discretionary spending and House Majority Leader Eric Cantor (R-Va.) has pushed for $1.7 trillion, The Washington Post’s Lori Montgomery reported Monday.