- The Washington Times - Tuesday, September 13, 2011

Congress’ chief scorekeeper effectively shortened the window for the new deficit supercommittee to reach a deal, saying Tuesday that if lawmakers are going to meet their Thanksgiving deadline, his office will need to see an agreement at the beginning of November.

Kicking off the first hearing before the Joint Select Committee on Deficit Reduction, Congressional Budget Office Director Douglas W. Elmendorf also boosted President Obama’s call for tax cuts and spending now coupled with a promise for fiscal restraint, saying that sort of plan can be consistent with deficit reduction and a stronger economy.

Still, he said, something must give over the long term. Taxes will have to rise dramatically or entitlement programs, such as Social Security and Medicare, will have to be scaled back.

“The fundamental question for you is not how we got here but where you want the country to go; what role do you and your colleagues want the government to play in the economy and the society,” he said. “If you want a role that has benefit programs for older Americans like the ones we’ve had in the past and that operates the rest of the government like the ones we’ve had in the past, then more tax revenue is needed than under current tax rates.”

The supercommittee held its first hearing Tuesday as warnings about the government’s dire fiscal position grew.

Treasury Department figures showed the federal government ran a deficit of $134.2 billion in August, marking the 35th straight month the government has been in the red. With one month remaining in the fiscal year, the government’s deficit has already topped $1.23 trillion — just below last year’s pace.

Meanwhile, former Federal Reserve Chairman Alan Greenspan warned another congressional panel that there is no longer any solution “without inflicting economic pain.”

The debt deal reached last month charged the 12-member supercommittee with producing at least $1.2 trillion in spending cuts and tax increases by Thanksgiving, and the full Congress would have until Christmas to pass their recommendations. If they fail, automatic cuts of $1.2 trillion would be slated for future years.

Committee members already were feeling deadline pressure, and Mr. Elmendorf on Tuesday only added to it, saying they have about a month and a half left before submitting recommendations for scoring by the CBO.

“With all respect, your decisions really need to be mostly made by the beginning of November if you want to have real legislation and a cost estimate from CBO to go with that before you get to Thanksgiving,” he said.

That puts Congress on a collision course with another deadline: Mr. Obama has said he wants lawmakers to take immediate action on the job-stimulus legislation he sent to Congress on Monday.

Senate Majority Leader Harry Reid, Nevada Democrat, told reporters Tuesday he wasn’t sure how he would proceed on the jobs bill, though he blasted Republicans for rejecting it out of hand.

Mr. Reid said the tax cuts have enjoyed bipartisan support in the past and that the GOP should have at least embraced those.

“They just put a carte blanche, ‘We don’t like it.’ I think that’s unfortunate,” he said.

But Republicans said while some of the new provisions may have support, the way Mr. Obama paid for the bill was $467 billion in tax increases, most of which have faced bipartisan opposition in the past.

Mr. Obama will deliver a broader plan Monday with ideas for where the supercommittee might find some of the savings it has been charged with recommending.

The White House said it will be up to Congress whether to substitute those ideas for the tax increases he proposed in his job-stimulus plan.

Interest groups said they feared calls from some of the committee’s members to consider paring back entitlement programs.

“Repeated statements that these programs are the primary drivers of our current debt, contrary to the facts, do a disservice to the process and impede finding real solutions to the real problems,” said Max Richtman, president of the National Committee to Preserve Social Security and Medicare.

But Mr. Elmendorf repeatedly pointed to those programs as the key difference in future budgets and debt.

“There is no way to simultaneously let Social Security and major health care programs grow the way they would under current policies, or anything close to that, and operate the rest of the federal government in line with its role in the economy over the past 40 years, and keep revenues the same share of [gross domestic product] they’ve been on average in the past 40 years,” he said.

Mr. Elmendorf poured cold water on the hope to squeeze considerable money out of fraudulent or improper payments, saying some of those would be made anyway and others are tough to do.

“There is no evidence that suggests that this sort of effort can represent the large share of the $1.2 [trillion] or $1.5 [trillion] or the larger numbers some of you have discussed in being the objective in savings for this committee,” he said.

He also said selling unused government property could raise some revenue but would not make a big dent in deficits.

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