Democrats and Republicans must move from comfort zones, debt reduction group says

Washington -- Call it the fiscal cliff sequel. Now, that Congress has averted the fiscal cliff, albeit temporarily, more deadlines are closing in to avert yet even more potentially serious economic problems.

And both the Obama administration and Republicans in Congress continue to talk tough, indicating a new deal will be as difficult, if not more difficult to reach than the fiscal cliff accord reached in the final hours of 2012 and first hours of 2013.

To summarize, the seemingly intransigent positions:

On expanding the nation's debt limit, which is needed by March so the United States can continue to pay its financial obligations, President Barack Obama has said Congress should pass it without conditions given that the spending that led to the increased national debt was approved by the House and Senate.

Some congressional Democrats say they are willing to negotiate, but that any plan has to be balanced -- with both new tax revenue and spending cuts. Republicans are fine with the spending cuts, but aren't willing to raise any additional taxes.

The so-called New Year's Day fiscal cliff deal, which averted deep cuts in defense and domestic programs until March 1, ended Bush-era tax cuts for family income over $450,000. That tax increase, as well as the end of the Obama administration's temporary 2 percent reduction in payroll taxes, represented the end of the road for the GOP on tax increases, according to several party leaders.

"The tax issue is finished. Over. Completed," said Senate Republican leader Mitch McConnell on ABC's This Week. "That's behind us. Now the question is what are we going to do about the biggest problem confronting our country and that's our spending addiction."

Complicating things even further is that House Speaker John Boehner, who has had several large scale deficit reduction deals with President Obama repudiated by his own GOP caucus, now says he's finished with one-on-one negotiations with Obama. Those earlier deals became non-starters for many House Republicans because they included tax increases.

The current stalemate doesn't present much room for optimism, though there's nothing like a potential fiscal crisis and the threat of another recession to change inflexible positions.

The Fix the Debt Campaign, made up of a coalition of big and small business leaders said a significant deficit reduction agreement will spur economic growth. But it will take a willingness by both parties to move away from their traditional positions -- GOP opposition to tax increases and reductions in defense spending and Democratic opposition to spending cuts, particularly for programs like Social Security and Medicare.

"Fix the Debt is a campaign that fundamentally is about moving outside of our collective comfort zones, rejecting the status quo, and it's about a willingness to accept financial and political discomfort for the sake of the country," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget and head of the Campaign to Fix the Debt. "Our country's federal debt problems are becoming more urgent each day, and by dragging their feet lawmakers in Washington are only backing us further into a corner."

But so far neither side is expressing much flexibility as deadlines near to reach a debt limit deal, a spending plan for the final six months of the 2013 fiscal year and a plan to avert automatic cuts in defense and domestic spending on March 1.

"The debt ceiling is our next best opportunity to start controlling spending," said Rep. Steve Scalise, R-Jefferson, rejecting Obama's demand that Congress extend the debt limit without imposing conditions.

Sen. David Vitter, R-La., who, unlike Scalise, voted for the New Year's deal, mainly because it made Bush tax cuts for family incomes up to $450,000 permanent, said the talk must now change from raising taxes to spending cuts.,

Rep. Bill Cassidy, R-Baton Rouge, agreed, saying the key for him is making structural reforms for Medicare, Medicaid and Social Security to make them fiscally sound well into the future.

Some Democrats have argued that a balanced plan, with cuts in spending and increases in tax revenue, would be sufficient to keep Medicare, Social Security funding sufficient to provide the benefits Americans have long expected and counted on after retirement.

Rep. Cedric Richmond, D-New Orleans, who successfully fought early GOP proposals to link the earlier debt reduction package to cuts in Medicare, said he and other Democrats will fight for a balanced approach -- not one in which all the sacrifice is exacted from middle class and lower-income Americans.

"I will be guided by two principles, shared sacrifice and what benefits the hardworking men and women of Louisiana the best," Richmond said.

Sen. Mary Landrieu, D-La., also argues that any new fiscal deal must be balanced. "I remain committed to working with my colleagues on both sides of the aisle to find a balanced approach to deficit reduction that includes both spending cuts and new revenues," Landrieu said.

Source: http://www.nola.com/politics/index.ssf/2013/01/democrats_and_republicans_must.html

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