CBO di­rec­tor gives fed­eral bud­get ne­go­tia­tors an ear­ful Urges at least a short-term fix

The Washington Times Weekly - - Politics - BY JAC­QUE­LINE KLI­MAS BY DAVID SHERFINSKI

All sides in the bud­get ne­go­ti­a­tions agreed Wed­nes­day that the fed­eral fis­cal pic­ture is grim, but the Con­gres­sional Bud­get Of­fice di­rec­tor told law­mak­ers not to let big fights over taxes and spend­ing get in the way of a short-term fix.

“Big steps are bet­ter than small steps, but small steps are bet­ter than no steps at all,” Dou­glas El­men­dorf said.

Mr. El­men­dorf was brief­ing ne­go­tia­tors who are work­ing to write a 2014 fed­eral bud­get, say­ing the fis­cal pic­ture is still “un­sus­tain­able.”

Though he en­cour­aged a short-term so­lu­tion over do­ing noth­ing, he left no ques­tion that long-term re­forms are needed even­tu­ally, es­pe­cially to man­age So­cial Se­cu­rity and Med­i­caid costs. Congress will have three choices, he said: cut those en­ti­tle­ments, in­crease rev­enue or cut other pro­grams.

“You don’t have a choice about do­ing at least one of those things. You can do one or two or three if you choose to, but at least one of those things will have to change,” he said.

The House and Se­nate ne­go­tia­tors are rac­ing a mid-De­cem­ber dead­line for writ­ing a fi­nal bud­get blue­print, which would give the spend­ing com­mit­tees about a month to write in­di­vid­ual ap­pro­pri­a­tions bills. The gov­ern­ment is run­ning on stop­gap money right now, but that ex­pires Jan. 15.

Repub­li­cans have ruled out big tax in­creases, while Democrats have said they won’t ac­cept ma­jor cuts to So­cial Se­cu­rity or other en­ti­tle­ments, leav­ing law­mak­ers chiefly to fid­dle with the au­to­matic se­quester bud­get cuts, which are due to hit again in Jan­uary.

Mr. El­men­dorf said tax in­creases and spend­ing cuts — the most “abrupt fis­cal tight­en­ing” since World War II — have helped cut the deficit dra­mat­i­cally, but that they also have harmed the econ­omy.

“Our anal­y­sis in­di­cates it has also slowed eco­nomic growth in the past few years,” Mr. El­men­dorf said.

De­spite this, Sen. Chuck Grass­ley said se­ques­tra­tion is work­ing. He urged the com­mit­tee to fo­cus on eco­nomic growth and job cre­ation, not mil­i­tary strength.

“I hope we keep in mind that the eco­nomic strength of our coun­try is a nec­es­sary pre­con­di­tion to our mil­i­tary strength,” the Iowa Repub­li­can said. “With­out eco­nomic strength, there won’t be any na­tional se­cu­rity. Com­pro­mis­ing on the se­quester for more money for the mil­i­tary I think is short-sighted.”

Mr. El­men­dorf’s overview of the eco­nomic state of the coun­try was dis­cour­ag­ing, but Sen. Patty Mur­ray, Wash­ing­ton Demo­crat and chair­woman of the Se­nate Bud­get Com­mit­tee, said she is “very en­cour­aged” by con­ver­sa­tions with Rep. Paul Ryan, chair­man of the House Bud­get Com­mit­tee, that they can reach a fi­nal deal.

“I’m hop­ing we’ll get to a bi­par­ti­san com­pro­mise very soon,” she said in the meet­ing.

How­ever, law­mak­ers con­tin­ued to keep ex­pec­ta­tions for a large deal very low.

“I think we can reach an agree­ment, though I’m not sure how large it’s go­ing to be,” said Rep. Tom Price, Ge­or­gia Repub­li­can. “I think we need to walk be­fore we can run.”

The CBO re­leased a re­port Wed­nes­day af­ter­noon de­tail­ing the bud­getary ef­fects of more than 100 op­tions that would de­crease spend­ing or in­crease rev­enue. While the re­port does not eval­u­ate which would be best, it does lay out the con­se­quences of each op­tion, in­clud­ing how much it would save the gov­ern­ment over the next 10 years.

Op­tions range from So­cial Se­cu­rity re­forms to in­creas­ing taxes on cig­a­rettes to can­cel­ing the Navy’s plans to ac­quire more bal­lis­tic-mis­sile sub­marines. Some that would save the most in­clude re­duc­ing the size of the mil­i­tary, which would save $495 bil­lion, and im­pos­ing a $25 tax per met­ric ton on green­house gases, which would save more than $1 tril­lion over 10 years.

In just six weeks, Repub­li­cans have com­pletely erased a 9-point deficit in a generic con­gres­sional bal­lot ques­tion and are now run­ning even with Democrats.

Thirty-nine per­cent of reg­is­tered vot­ers say they would vote for a Demo­crat in their dis­trict — and the same per­cent­age say they would vote for a Repub­li­can — if elec­tions for the U.S. House of Rep­re­sen­ta­tives were held to­day, ac­cord­ing to num­bers from a Quin­nip­iac poll re­leased Wed­nes­day.

Last month, Democrats held a 9-point ad­van­tage on the same ques­tion, 43 per­cent to 34 per­cent.

In­de­pen­dent vot­ers fa­vored Democrats in Oc­to­ber, 32 per­cent to 30 per­cent, but now fa­vor Repub­li­cans by a 37 per­cent to 26 per­cent mar­gin.

That’s not to say vot­ers are wildly im­pressed with ei­ther party; 20 per­cent ap­prove of the way con­gres­sional Repub­li­cans are han­dling their jobs, com­pared with 73 per­cent who dis­ap­prove. In­ter­est­ingly, 30 per­cent ap­prove of how Democrats in Congress are han­dling their jobs, com­pared to 62 per­cent who dis­ap­prove.

A sim­i­lar split is ev­i­dent in vot­ers’ opin­ion of both ma­jor po­lit­i­cal par­ties. Thir­tyeight per­cent have a fa­vor­able opin­ion of the Demo­cratic Party, com­pared to 48 per­cent who have an un­fa­vor­able opin­ion. Mean­while, 31 per­cent have a fa­vor­able opin­ion of the Repub­li­can Party, with 54 per­cent hold­ing an un­fa­vor­able opin­ion of the GOP.

A ma­jor­ity of vot­ers don’t like how top con­gres­sional lead­ers are han­dling their jobs: 58 dis­ap­prove of House Speaker John A. Boehner, Ohio Repub­li­can, 55 per­cent dis­ap­prove of House Mi­nor­ity Leader Nancy Pelosi, Cal­i­for­nia Demo­crat, and 52 per­cent dis­ap­prove of Se­nate Ma­jor­ity Leader Harry Reid, Ne­vada Demo­crat.

A plu­ral­ity of vot­ers — 46 per­cent to 27 per­cent — dis­ap­prove of how Se­nate Mi­nor­ity Leader Mitch McCon­nell, Ken­tucky Repub­li­can, is han­dling his job.

“In Wash­ing­ton to­day, it comes down to who the vot­ers dis­like the least,” said Tim Mal­loy, as­sis­tant di­rec­tor of the Quin­nip­iac Univer­sity Polling In­sti­tute. “There are no he­roes.”

The poll of 2,545 reg­is­tered vot­ers was con­ducted from Nov. 6 to 11 and has a mar­gin of er­ror of 1.9 per­cent­age points.

Thirty-two per­cent of re­spon­dents self-iden­ti­fied as Democrats, 26 per­cent said they were Repub­li­cans, and 35 per­cent said they were in­de­pen­dents.

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