Prospects For Debt Deal Look Dim
Time is short for the congressional supercommittee to find $1.2 trillion in deficit reductions, but the prospects of a deal are dim.
Several committee members hit the airwaves to say why the panel is on the verge of failure. Democrats insist the problem is Republicans' steadfast unwillingness to raise taxes on the wealthy. While Republicans, including Pennsylvania Sen. Pat Toomey, say Democrats aren't willing to make serious cuts to Medicare and Medicaid.
"On the other side, there is an insistence that we have a $1 trillion tax increase," he said on CBS' Face the Nation. "There was an unwillingness to cut any kind of spending at all unless there was a huge tax increase."
Democratic Sen. Patty Murray of Washington countered that view on CNN's State of the Union.
"The wealthiest of Americans, those who earn over a million dollars every year, have to share too and that line in the sand, we haven't seen any Republicans willing to cross yet," she said.
Reality Overtakes Hope
Texas Rep. Jeb Hensarling, the Republican co-chair of the debt supercommittee, offered a glum assessment of prospects for an agreement.
"Nobody wants to give up," he told "Fox News Sunday," but "the reality is to some extent starting to overtake hope."
He said the panel's deadlock "was a failure in not seizing an opportunity."
Panel members said they will be available for further talks Sunday in hopes of a final breakthrough and some last-minute offers on smaller deficit-cutting packages were possible. Also on the agenda is stage managing the group's disbandment.
Republicans are demanding changes in so-called entitlement programs such as Medicare and Medicaid while Democrats are insisting on tax increases on the wealthy.
Over the past couple of weeks, the two sides have made a variety of offers and counter-offers, starting with a more than $3 trillion plan from Democrats that would have increased tax revenues by $1.3 trillion in exchange for further cuts in agency budgets, a change in the measure used to calculate cost-of-living increases for Social Security beneficiaries, and curbs on the growth of Medicare and Medicaid.
Republicans countered with a $1.5 trillion plan that included a potential breakthrough — $250 billion in higher taxes gleaned as Congress passes a future tax reform measure. The plan was trashed by Democrats, however, who said it would have lowered tax rates for the wealthy too far while eliminating tax breaks that chiefly benefit the middle class.
Most recently, Republicans forwarded a smaller, face-saving $644 billion offer comprised of $543 billion in spending cuts, fees and other non-tax revenue, as well as $3 billion in revenue from closing a special tax break for corporate purchases of private jets. It also assumed $98 billion in reduced interest costs.
On Saturday, Republicans floated an even smaller, unspecified offer, said a lawmaker directly familiar with the panel's work. It too was rejected. The lawmaker required anonymity because of the secrecy of the talks.
Impact Of Failure
Officials familiar with the offer said it would save the government $121 billion by requiring federal civilian workers to contribute more to their pension plans, shave $23 billion from farm and nutrition programs and generate $15 billion from new auctions of broadcast spectrum to wireless companies.
Democrats said the plan was unbalanced because it included barely any tax revenue.
Failure to reach agreement would trigger automatic across-the-board spending cuts to a wide variety of domestic programs and the Pentagon budget, starting in January of 2013. But both Defense Secretary Leon Panetta and many lawmakers say this automatic sequester would impose devastating cuts at the Pentagon.
"I hope it will be changed," Hensarling said. "Panetta said that cuts of that magnitude would hollow out our national defense."
NPR's Tamara Keith contributed to this report, which includes material from The Associated Press