Congress sputters on deficit cuts, spending bills

By Andrew Taylor

Associated Press

Published: Tuesday, Nov. 8 2011 12:00 a.m. MST

WASHINGTON — A sputtering Congress enveloped in an atmosphere poisoned with politics and distrust enters its final weeks of the year struggling to complete a lengthy to-do list on the budget.

The so-called deficit supercommittee is hung up over taxes, raising real doubts it will succeed in its assignment of cutting deficits by at least $1.2 trillion over the next decade.

The once all-powerful appropriators responsible for everything from funding the Pentagon to making sure the Agriculture Department has enough meat inspectors are struggling, too, victims of a tea party revolt and indifference among congressional leaders themselves.

Together, the appropriators and supercommittee are responsible for filling in the details of last summer's budget and debt ceiling agreement between President Barack Obama and Capitol Hill Republicans.

With little more than two weeks left for coming up with a plan to wring $1.2 trillion from the deficit, the supercommittee remains hung up over taxes.

Democrats proposed a 10-year, approximately $3 trillion deficit-cutting plan, which included $1.3 trillion in new tax revenues. Republicans countered with a $2.2 trillion plan without tax increases.

Without new revenues, Democrats are unwilling to cut Medicare or impose a new inflation measure to reduce annual cost-of-living increases for Social Security beneficiaries.

"We have said we are very open to painful concessions and compromises if Republicans are, as well," said Sen. Patty Murray, D-Wash., the co-chairman of the supercommittee. "But these concessions will only be made and only considered in the context of a balanced deal that doesn't just fall on the middle class and most vulnerable Americans."

On Tuesday, GOP aides said Republican panel members were showing more flexibility on revenues, including an idea by Sen. Pat Toomey, R-Pa., that would place limits on the total amount of tax deductions and credits that individuals could claim, in exchange for lower income tax rates. But Democrats said Republicans aren't going far enough.

"We've made a little bit of progress but it's not enough in our judgment," said Sen. John Kerry, D-Mass., a member of the deficit panel. "We have some distance to go."

Failure by the supercommittee to produce a plan would trigger automatic cuts a year from now to both domestic programs and the Pentagon's budget, a prospect that has defense hawks up in arms and already working on legislation to undo the "sequester" mechanism that would force the cuts.

A sequester would reduce the Pentagon's budget by another half-trillion dollars over the next decade. That would be in addition to a $450 billion cut as part of the summer deal between Obama and congressional Republicans.

"The results of a sequester will be a hollow military," Republican Sens. John McCain of Arizona and Lindsey Graham of South Carolina told Defense Secretary Leon Panetta in a letter.

Panetta himself has warned of "devastating" consequences if Pentagon spending is cut by the automatic sequester.

The appropriators, meanwhile, are supposed to be working on a parallel track to complete the 12 annual spending bills for funding the day-to-day activities of federal agencies this year.

A month into the 2012 budget year, not one of them has been completed. The House has passed its versions of six of the bills, the Senate has approved its versions of four. Those versions have to be merged and passed again before the president can sign or reject them.

A stopgap funding measure runs out on Nov. 18.

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