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Posted at 03:54 PM ET, 07/18/2011

Tom Coburn unveils plan to achieve $9 trillion in deficit savings over next decade

Oklahoma Republican Sen. Tom Coburn on Monday released a plan that he says would achieve $9 trillion in deficit savings over the next decade through a combination of far-reaching spending cuts, entitlement reform and increased tax revenue.

“This plan offers the American people nine trillion reasons to stop making excuses and start solving the problems in Washington,” Coburn said at a Monday afternoon news conference announcing the 600-plus- page plan. “I have no doubt that both parties will criticize this plan, and I welcome that debate. But it’s not a legitimate criticism until you have a plan of your own.”

Coburn’s “Back in Black” plan – which he unveiled as negotiations on raising the country’s $14.3 trillion debt ceiling are in their final two weeks – makes some recommendations that are anathema to both political parties.

The plan would cut $1 trillion in defense spending over the next 10 years; enact $2.6 trillion in deficit savings through changes to popular entitlement programs such as Medicare and Medicaid; and generate $1 trillion in savings through reforming tax expenditures, including the elimination of ethanol subsidies.

Nearly three-dozen Senate Republicans voted in favor of doing away with such subsidies last month. But GOP leaders remain opposed to the inclusion of any tax increases in any long-term deficit-reduction plan that is devised as part of a deal to raise the debt ceiling. On Monday, Coburn directly took on those in his party who would point to the elimination of special-interest tax breaks as a tax increase while maintaining that he does not support any effort to increase rates.

“Tax expenditures are not tax cuts,” Coburn said. “Tax expenditures are socialism and corporate welfare. Tax expenditures are increases on anyone who does not receive the benefit or can’t hire a lobbyist or special interest group to manipulate the code to their favor. Politicians love to play the tax code because it benefits the politicians. No conservative should support Washington choosing winners and losers in the tax code.”

Democrats have expressed strong opposition to any cuts to entitlement programs as part of a debt-limit deal, although they (along with the White House) have signaled some openness to changes to those programs that would not result in benefit cuts. It was resistance on the part of Democrats to any entitlement cuts that Coburn cited in May when he left the bipartisan Gang of Six negotiations on achieving a sweeping deficit-reduction plan.

In addition to changes to Medicare and Medicaid, Coburn’s proposal would also overhaul Social Security, but would use any savings generated to extend the program’s solvency rather than bringing down the national debt. The plan would also gradually raise the Social Security retirement age by one month every two years beginning in 2022.

Coburn’s plan has little chance of progressing in the Senate, where the parties have been at odds even over proposals to cut a fraction of the amount Coburn’s plan would slice from the country’s debt.

Still, Coburn said that he believed even a $4 trillion “grand bargain” that all parties have said they prefer would not save the country from its long-term fiscal woes.

“Four trillion dollars doesn’t solve our problems,” he said. “Four trillion dollars buys us five years to solve the next $5 trillion that we’re going to have to solve.”

Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) have been working behind-the-scenes to put together a “Plan B” that would avoid default by allowing the debt limit to be extended and placing the political burden on President Obama and congressional Democrats. Some conservative Republicans have come out strongly against the outline of the plan thus far; Coburn on Monday stopped short of opposing it but said that he believed the country, and Congress, could do better.

“If that’s what we end up with, that’s what we’ll end up with,” Coburn said of the McConnell-Reid plan. “But I think that’s a commentary on Washington. Here we have this great big problem in front of us, and what’s our answer? Punt? Because it’s politically more palatable? I didn’t come here to do that.”

By  |  03:54 PM ET, 07/18/2011

 
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