- The Washington Times - Wednesday, May 16, 2012

While Congress may still squeak out a few bipartisan bargains in the last half of an increasingly divisive election year, big differences over increasing taxes on millionaires and whether the military and domestic spending will face deep cuts come December are overshadowing any efforts to reach across the aisle.

President Obama’s meeting with a bipartisan group of congressional leaders on Wednesday demonstrated how entrenched both sides remain when it comes to their visions for bolstering the economy.

The president Wednesday had planned to press GOP leaders to act on a to-do list of economic proposals that could cost up to $34.7 billion, but Republicans threatened a redux of last summer’s budget brawl, shifting the spotlight to paying down the deficit.

Republicans want to offset any new debt from raising the debt ceiling with equal spending cuts.
Even though the meeting was reportedly friendly, the only thing the two agreed on was how thoroughly both enjoyed the tasty hoagie sandwiches the president brought with him from a D.C. sandwich shop.

“The speaker told the president, ‘As long as I’m around here, I’m not going to allow a debt-ceiling increase without something serious about the debt,’” a Boehner aide relayed after the meeting.

Democrats said the saber-rattling was unnecessary this early because a debt-ceiling increase would likely not be needed until the end of the year, after the election. But Democratic leaders were equally intransigent in their calls for increasing taxes on millionaires to make good on last year’s agreement to pay down the nation’s deficit by $1.2 trillion.

If Republicans refuse to accept a tax increase on millionaires as part of a “balanced agreement,” Senate Majority Leader Harry Reid, Nevada Democrat, said any new debt approved will be dealt with during an end-of-year lame-duck session. And Republicans, he said, will be forced to accept last year’s “sequester” agreement to cut $1.2 trillion in discretionary spending in a “fair manner” - half from military spending and half from domestic spending.

Republicans are dead-set opposed to forcing the military to endure the cuts, and the looming proposition inevitably will force an end-of-the-year showdown between the two sides.

If Mr. Obama wins re-election, there will be little time to celebrate as the two sides square off in the end-the-year battle, but if Republican Mitt Romney captures the White House and the GOP retains the House majority, Republicans will be able to claim a mandate and leverage the win to press for spending cuts to domestic programs.

During Wednesday’s White House meeting, Senate Minority Leader Mitch McConnell, Kentucky Republican, tried to focus on forging compromise with Democrats and the president on several upcoming legislative priorities, such as producing a bill to prevent the student-loan rates from doubling on July 1 that could pass the Senate.

“He believes that there is more time before the election for even more bipartisan accomplishments,” his spokesman said.

Republicans and Democrats remain deeply divided over how to pay for keeping the loan rates low. Senate Republicans last week blocked a Democratic bill that would have covered the $6 billion cost by raising Social Security and Medicare payroll taxes on a select group of businesses. Republicans want to pay for the bill by slashing a catch-all prevention fund in the 2010 health care law.

Mr. McConnell said the Senate has passed a bevy of bipartisan bills over the last year once “poison pills” had been removed and Republicans were included in the debate, citing the Jobs Act, aimed at cutting bureaucratic red tape for small businesses, three trade agreements, the highway bill, the extension of the payroll-tax relief and patent reform.

Earlier this year, the president was successful in passing a 20 percent tax deduction for small businesses and an ethics bill aimed at preventing members of Congress from engaging in insider trading.

But in recent weeks, his agenda has foundered. The Democrat-controlled Senate for the second time this year on Wednesday failed to pass the president’s budget and his proposal for student-loan relief didn’t attract enough votes to overcome a procedural hurdle last week.