Analysts on the Super Committee Failure

By The NewsHour, The NewsHour - November 21, 2011

Make a Comment

Listen: MP3

JUDY WOODRUFF: The deficit supercommittee threw in the towel today on trying to reach a sweeping 10-year agreement. The announcement had been expected all day, and the fallout was felt on Wall Street. The Dow Jones industrial average lost more than 248 points to close at 11,547. The Nasdaq fell 49 points to close at 2,523.

Beyond the market effects, the super committee's admission of failure left an unsettled political picture.

Reporters waited through the day as last-ditch talks took place in the offices of Democratic Sen. John Kerry.

SEN. JOHN KERRY, D-Mass.: I think it's pretty imperative to get done what we -- I think there's a time limit on us that's coming down to hours.

JUDY WOODRUFF: But, in the end, there was no deal. In a statement, the panel's leaders said, "We are deeply disappointed that we have been unable to come to a bipartisan deficit reduction agreement."

The 12 Republicans and Democrats on the supercommittee had tried for nearly three months. Their mandate was to find at least $1.2 trillion in deficit savings over 10 years. By law, failure triggers automatic spending cuts of the same amount starting in 2013.

Those cuts would mean reductions in Medicaid and other domestic spending and up to $450 billion in the Pentagon budget, bringing U.S. ground forces to their lowest levels since 1940.

President Obama was quick to lament the super committee's failure.

PRESIDENT BARACK OBAMA: Already, some in Congress are trying to undo these automatic spending cuts. My message to them is simple: No. I will veto any effort to get rid of those automatic spending cuts to domestic and defense spending. There will be no easy off-ramps on this one. We need to keep the pressure up to compromise, not turn off the pressure.

JUDY WOODRUFF: But the prospect of such cuts failed to force agreement. Instead, the two sides debated who is to blame on the Sunday talk shows. Democrats accused Republicans of protecting the Bush era tax cuts for the wealthy, no matter the cost.

Washington State Sen. Patty Murray, a supercommittee co-chair, appeared Sunday on CNN.

SEN. PATTY MURRAY, D-Wash.: But there is one sticking divide. And that is the issue of what I call shared sacrifice, where everybody contributes in a very challenging time for our country.

JUDY WOODRUFF: On FOX, Republican co-chair Congressman Jeb Hensarling of Texas said the real problem was Democrats' refusal to be serious about spending cuts.

REP. JEB HENSARLING, R-Texas: It's a huge missed opportunity. But, unfortunately, what we haven't seen in these talks from the other side is any Democrat willing to put a proposal on the table that actually solves the problem.

JUDY WOODRUFF: The stalemate over reaching a debt deal also foreshadows more battles in a sharply divided Congress. The two sides are likely to split over extending the payroll tax cut, now set to expire at the end of the year. A similar fight awaits on extending jobless benefits for the long-term unemployed, also set to expire Dec. 31.

With no agreement possible, we assess the legislative logjam and where things go next with three people who watch all of this closely.

Maya MacGuineas is president of the Committee for a Responsible Federal Budget. Henry Aaron tracks entitlement and budget issues at the Brookings Institution. And Norm Ornstein is a longtime congressional observer at the American Enterprise Institute.

And we thank you, all three, for being here.

Norm, on this I guess momentous day, was this committee doomed to failure from the start?

NORMAN ORNSTEIN, American Enterprise Institute: I don't think it was doomed to failure from the start.

I actually had what had to be cautious optimism, which meant maybe there's a 25 percent chance of success, because there's some things that drive them towards an agreement. And that includes a dire economic situation in Europe and the possibility that failure will lead to something much worse.

But, you know, in the end, the dysfunction in the system and the partisan divide meant that an agreement, a template out there that we have had now for more than a year from three separate bipartisan groups, they just couldn't bring it together. And it was the tax issue and the Republicans' just inability to move on that in a way that Simpson-Bowls, Rivlin-Domenici, the gang of six, the three groups that have done this, had set out for them.

JUDY WOODRUFF: Was one side more culpable than another here?

NORMAN ORNSTEIN: I really do think that the issue was taxes.

Democrats had signaled a willingness to move on entitlements, which is the trade-off that we are going to have here, and on tax reform. And that included many of the members of the committee saying that they were willing to entertain raising the Medicaid -- Medicare age from 65 to 67.

It was a signal that they could reach this kind of template, you know, Simpson-Bowles. All the others were $4 trillion over 10 years, with at least a trillion coming from revenues with tax reform, and with at least another trillion coming from the large entitlement programs. But it was the inability to bring the tax issue to the fore, in anything more than small amounts that kept Republicans from getting across that divide.

JUDY WOODRUFF: Maya MacGuineas, there are some people arguing today that the country is better off without an agreement, that what they would have come up with wouldn't have helped things, might have made things worse. What do you think?

MAYA MACGUINEAS, Committee for a Responsible Federal Budget: I think that is absolutely the wrong argument.

I think what we are on track right now is to have cuts that come from a sequester, which is automatic spending cuts, not done thoughtfully, but done automatically across the board, to some of the wrong parts of the budget. It doesn't do anything to help fix Social Security. It doesn't do anything on the revenue side. And it's not the thoughtful way to fix the problem.

Read Full Article »

Latest On Twitter

Follow Real Clear Politics

Real Clear Politics Video

More RCP Video Highlights »