Legislative Update

Congress is going through the motions of governing. Meetings and hearings and many floor speeches filled with political rhetoric are taking place. Still everybody knows nothing really is going to happen until the impasse surrounding when and how to raise the debt limit has been settled.

President Obama is still hopeful an agreement can be reached. The White House said a “significant deal remains possible,” even while reiterating that to get a “significant” deal there must be a balanced approach” that includes increased revenue. White House press secretary Jay Carney stated it more plainly when speaking to White House reporters, “We believe that it is still very much possible that if everyone is willing to abandon the ‘my way or the highway’ approach, to accept that compromise on behalf of the American people requires tough choices, we can get significant deficit reduction done this year.” Carney said a balanced approach means deficit reduction “through cuts in non-defense discretionary spending; through cuts in defense spending; through savings out of the tax code; and obviously savings through entitlements and interest on the debt. That’s the way you get significant deficit reduction.” This approach was also discussed by the fiscal commission and other bipartisan groups that have developed recommendations.

On the other hand, most if not all Republicans are saying revenue enhancers and tax increases are off the table. Senate Minority Leader Mitch McConnell said tax increases are not feasible simply because they can’t pass Congress. “Not only are they counterproductive from the standpoint of an economic recovery; they’re also politically impossible, since Republicans oppose tax hikes and Democrats have already shown they won’t raise taxes in a down economy,” McConnell said, referencing Democratic opposition last year to raising taxes. “So let’s start by taking both proposals off the table and focus on what can actually pass Congress, and what will actually spur the private sector to invest in our future and create jobs,” McConnell said.

by Arley Johnson