Could the bi-partisan “Gang of Six” plan embraced by the President today be a real breakthrough on the debt ceiling issue?
Don’t count on it.
First, the good news. As Sunlen Miller reports, the bi-partisan “Gang” presented their ambitious $3.7 trillion deficit reduction plan to a bi-partisan group of some 50 Senators. The reception was positive. Senators from both parties praised the plan. Senator Joe Manchin (D-WV) even declared, “We went from a Gang of Six to a Mob of 50.” The President praised it. The stock market loved it.
Now, some reality. The plan has already drawn fire from the right (Senator Jim DeMint says he has “serious concerns” and Senator Jeff Sessions says the plan hikes taxes “by at least $1 trillion”), and the left (“devastating cuts to Social Security and Medicare and Medicaid” said Bernie Sanders).
“This is an approach that should be rejected by the American people,” said Sanders in a paper statement. “At a time when the rich are becoming richer and corporate profits are soaring, at least half of any deficit-reduction package must come from upper income people and profitable corporations.”
But the coldest splash came from Senate Majority Leader Harry Reid:
“I don't want to do anything to jeopardize the enthusiasm people have for the Gang of Six,” Reid told reporters after the Gang presented its plan, “but I am the person that runs the Senate and I understand what the rules of the Senate are.”
Senator Mitch McConnell was more diplomatic, but I am told he doesn’t like the plan either.
It’s the same old problem: Democrats don’t want to sign on to deep spending cuts and Republicans fear that the plan will lead to big tax increases.
But there’s another problem: The Gang of Six proposal leaves the specifics up to Congressional committees to hammer out in the future. The principles are outlined, the targets are set, but the details are to be determined at a later date and other than an “down payment” of $500 billion in spending cuts, there’s no guarantee Congress will actually act on the bigger spending cuts and revenue increases the plan promises.