Deficit summit brings about more talk, no answers
May 15, 2012, 9:57 PM
Associated Press
WASHINGTON (AP) – Government leaders past and present gathered in Washington Tuesday to do what they do best about the nation’s deficit woes: talk.
At an annual “fiscal summit” in a Washington that seems almost comically unable to function, much less take action to reform Medicare or raise taxes to close a crippling budget gap, a crowd of the converted listened to Washington elite: Treasury Secretary Tim Geithner, former President Bill Clinton, House Speaker John Boehner, R-Ohio, members of a failed deficit “supercommittee,” and the chairman and top Democrat on the House Banking Committee.
There was universal agreement. The deficit is bad and Washington really, really needs to fix it. Fast.
What was lacking was any agreement on how to do it, and certainly no expectation that the warring tribes in Washington will do anything meaningful to tackle trillion-dollar deficits before the election.
The summit is hosted by Pete Peterson, who has staked $1 billion of his Wall Street fortune on a foundation dedicated to educating the public on the perils of the deficit. Peterson’s events tend to attract many of the same people time after time, including a number of people who are full-time, professional deficit hawks like Maya MacGuineas of the Committee for a Responsible Federal Budget and Bob Bixby of the Concord Coalition.
“Summits like these … bring together people who just get it,” said Boehner. “Of course, while I’m happy to be here and I’m sure we all enjoy each other’s company, we can also agree that we’ve talked this problem to death. It’s about time we roll up our sleeves and get to work.”
Each year, the summit features warnings that it’s best to take on the deficit immediately, so that future solutions don’t have to be as draconian. And there’s handwringing every time about the chronic inability of the warring political parties to drop their talking points and take politically painful steps to tackle the nation’s $15 trillion-plus national debt.
Since last year’s summit, there have been three or four failed attempts at tackling the deficit: talks convened by Vice President Joe Biden; an attempt at a “Grand Bargain” between President Barack Obama and Boehner; the failure of a subsequent deficit “supercommittee” last fall; and the inability of the Senate’s bipartisan “Gang of Six” last fall to gain much traction.
“I think we’re in the post-denial phase of talking about the deficit, both Democrats and Republicans,” opined the Wall St. Journal’s David Wessel.
“What follows denial?” quipped Treasury Secretary Tim Geithner. “Anger?”
The crowd was smaller this year _ lots of space at tables for a lunch of pan-seared chicken breast on a mirepoix of spring vegetables _ and there was a lot of resignation among participants that not much of anything might get done about trillion dollar-plus deficits before the elections in November.
Boehner made the top headline at this year’s summit by declaring that when it comes time for Congress to raise the nation’s borrowing cap he will again insist on spending cuts and budget reforms exceeding the amount of the debt increase to offset it. He also promised a vote on renewing trillions of dollars in tax cuts passed during the Bush administration, prompting a predictable response from top House Democrat Nancy Pelosi of California.
“Republicans are once again choosing millionaires over the middle class,” Pelosi said in a statement.
That kind of partisanship earns poor reviews from the Peterson conference crowd, where several people lamented the recent primary loss of Indiana Republican Sen. Dick Lugar to a tea party-backed candidate, State Treasurer Richard Mourdock, who has vowed to come to Washington to fight, not compromise.
“We can’t be in a position where one of the negotiating partners says, `That’s non-negotiable. Not only will we not raise taxes, we want the Bush tax cuts and we want more tax cuts,'” Clinton told interviewer Tom Brokaw of NBC.
Brokaw, for his part, called out the powerful AARP lobby for senior citizens, for being “kind of in your face” to politicians for running an ad reminding them that “we are 50 million seniors who earned our benefits, and you will be hearing from us today and on Election Day.” That’s the kind of stuff that makes deficit hawks furious.
And there was lots of talk about a “fiscal cliff” that’s coming up at the end of the year with the expiration of Bush-era tax cuts and a looming round of automatic spending cuts _ called a “sequester” in the budget argot that everybody at the session seemed to take for granted. That led moderators Judy Woodruff of the PBS’ NewsHour and ABC’s George Stephanopolous to ask panelists like Budget Committee Chairman Paul Ryan, R-Wis., and former Sen. Alan Simpson, R-Wyo., whether there might be some kind of big-time bipartisan budget deal in a post-election “lame duck” session.
Nope. The idea of compromise between politicians who just lost an election and those that just won an election didn’t get a lot of traction among the panelists.
Ryan, who’s hoping Election Day will bring GOP reinforcements beyond the party’s beachhead in the House, suggested instead that there would be a short-term patch to buy time for the new Congress and either a re-elected Obama or Republican President Mitt Romney to work out.
The summit was opened with an appearance by Geithner, who predicted that the ultimate solution would look a lot like the Obama’s deficit commission, co-chaired by Simpson. The commission got lots of praise from members of the deficit industrial complex like Peterson for recommendations like raising taxes and boosting the Medicare retirement age, but was mostly shunned as too radioactive by Obama and the Democratic and GOP leadership on Capitol Hill.
The Simpson proposal, in retrospect, looks like a good deal for Obama, since it included $2 trillion in new tax revenues over a decade and shielded the poor from many of its cuts.
Then came Boehner’s speech, which promised “broad-based tax reform that lowers rates for individuals and businesses while closing deductions, credits and special carve-outs” but failed to offer up any tax increases along the way.
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