Kent Conrad, the retiring Chairman of the Senate Budget Committee, just announced that the markup for the FY 2013 budget will commence tomorrow. And instead of creating model legislation, he will simply take the recommendations proposed by the Chairmen of the Bowles-Simpson deficit commission, popularly known as the “catfood commission,” as the baseline.
Tomorrow I will begin a Budget Committee markup of a long-term budget for the nation. As my Chairman’s Mark, I will lay down the bipartisan Fiscal Commission plan, also known as the Bowles-Simpson plan. It is a plan which I believe represents the best blueprint from which to build a bipartisan deficit reduction agreement that can ultimately be adopted.
What I am proposing is not partisan. I am trying to break from the ‘business as usual’ practice that has gone on for too long. I am hoping that my Senate colleagues will stand with me to do what is right for the country. That’s really the only way we can get something done. That might not happen this week, but it will have to happen.
To be clear, we already have a budget in place for this year and next. The Budget Control Act passed last summer provided the spending limits and enforcement measures for the budget for 2012 and 2013. It is the law of the land. What we do not have is agreement on a long-term budget plan. That is what we must now work to achieve.
The Bowles-Simpson Chairmen’s recommendations (which were never adopted by the commission) came out before Republicans took over the House. In reaction to that event, future long-term budget plans moved ever further to the right, including the deficit reduction blueprint from President Obama. So this has led many to say that Bowles-Simpson recommendations stand to the left of what has been proposed in Washington, because they raise far more revenue.
Not so fast. The Chairmen’s final Bowles-Simpson report still relied on 67% of its solutions from spending cuts and 33% from revenue increases (and that’s really the most charitable reading of their final report. It would include cuts to Medicare and an increase in the retirement age. In addition, tax rates would be lowered, flattened and made more regressive than in the Clinton years. And on the area where everyone agrees is the only one you need to worry about relative to any long-term deficit, health care, they play a game. They basically write, “just limit spending growth to GDP +1% every year by… just do it.” It’s known as a magic asterisk. If budgeting were this easy, you could eliminate the entire deficit tomorrow by simply saying “eliminate the deficit.” [cont’d.]
Conrad endorsed this proposal when it was first announced back in 2010, so this is no surprise. What is surprising is that the Senate Democrats are allowing Conrad to introduce Bowles-Simpson, with all of the above inside it, as the default markup baseline for the Budget Committee.
It’s clear that Conrad craves a bipartisan agreement on the budget. He acknowledges that Bowles-Simpson is “not perfect” but that it’s a “middleground, consensus solution to the country’s fiscal imbalance.” He will work off that plan and try to build support from both sides of the aisle.
Conrad has planned for a one-day markup tomorrow, and he doesn’t expect to finish work on the budget by then. Bowles-Simpson based what numbers it had on 2010 data; it’s two years later and many things about the budget have changed. “Those adjustments will have to be negotiated on a bipartisan basis, and those negotiations will take time,” Conrad says in his statement.
From the looks of the statement, Conrad doesn’t appear all that confident of a solution before the lame duck session. And he shouldn’t; the taxes alone are enough to keep Republicans off the plan. But putting Bowles-Simpson back into play before then in a formal manner allows that to become the off-the-shelf solution to avoid the fiscal cliff. In fact, Conrad doesn’t even seem primarily interested in introducing Bowles-Simpson as a budget. “It is important to remember that we already have a budget for this year and next. The Budget Control Act provided us with spending limits and enforcement measures for 2012 and 2013,” he writes. So Bowles-Simpson is just a placeholder, ready to strike in a moment of crisis.
UPDATE: I don’t doubt that the thinking Sahil Kapur describes here is part of the calculation. Republicans have been screaming about the Democrats in the Senate not passing a budget for 1,000 days, and about Obama not accepting the recommendations of the deficit commission (even though Bowles-Simpson were just the recommendations of the chairs; the commission made no recommendations). Now their bluff is being called. And when they reject Bowles-Simpson, they will be exposed. But ultimately, I don’t think this is the ultimate consequence of bringing Bowles-Simpson back. It’s to create an off-the-shelf solution to the fiscal cliff.