House Speaker John Boehner will rewrite sections of his debt-limit extension bill in response to the Congressional Budget Office's score that the original plan falls short of its advertised $1 trillion in savings.
Boehner spokesman Michael Steel told National Journal what had already been communicated to GOP skeptics in the House and Senate-that the CBO score required Boehner to revamp his up-front and 10-year budget savings to achieve the stated $1 trillion in deficit reduction.
And after National Journal learned that the House Rules Committee will not report out a rule on Tuesday evening on Boehner's bill, postponing a scheduled Wednesday vote on the plan, House Majority Leader Eric Cantor's office announced that the vote will take place on Thursday. The decision throws the fate of the plan in flux, with GOP aides working into the evening in search of additional savings, the sources said.
CBO has yet to score Senate Majority Leader Harry Reid's companion bill in the Senate. But because Boehner's vote is first-and the most consequential of his speakership-he has to meet the demands of dozens of skeptical House Republican who want the debt-ceiling bill to represent a credible down payment on deficit relief. For better or worse, at this late hour $1 trillion in savings over 10 years has become necessary for credibility among his colleagues. Boehner and his staff are now scrambling against time to meet that standard.
A GOP source familiar with the options on the table said leaders are considering finding additional deficit-reduction measures or lowering the amount by which Boehner's proposal would increase the debt ceiling, currently at $900 billion, to a number lower than the $850 billion deficit cut projected by CBO. Lowering the debt-ceiling figure would maintain the GOP pledge to enact spending cuts in excess of the debt increase.
Leadership was already facing an uphill battle to find the votes needed to pass the speaker's plan. The CBO report was likely to fuel skepticism among undecided lawmakers, particularly those in the GOP freshman class, that the Boehner proposal was not as far-reaching as they had been told. Boehner sparked doubts among freshmen and other conservatives earlier this year when the spending cuts he negotiated to head off a government shutdown also fell short of their expectations.
Even before the CBO report, leaders spent Tuesday working their conference to find the votes, which appeared out of reach even as Boehner asserted the bill could pass the chamber. House Democratic leaders are simultaneously working to hold their caucus together in opposition to the bill, making it harder for Boehner to get the bill over the finish line on his party's votes alone.
According to CBO, Boehner's plan would cut about $850 billion from federal budget deficits between 2012 and 2021 relative to the March 2011 baseline. Relative to its January baseline-a score Boehner requested be calculated-CBO reported that the bill would reduce deficits by about $1.1 trillion. The bulk of the plan's savings would come from capping discretionary spending.
The adjusted March baseline accounts for reductions in projected spending that had already been enacted through the appropriations process after the January baseline had been prepared. The January baseline largely assumed funding levels that had been continued from the previous year. The March baseline used in the scoring is what Boehner negotiated with the White House earlier this year to reduce spending and head off a shutdown.
To score Boehner's legislation, both the January and the March baselines were adjusted to account for the expected reductions in winding down the wars in Iraq and Afghanistan. The baseline used by CBO to score Boehner's plan includes the savings already projected for the wind down. Republicans have accused Senate Majority Leader Harry Reid, D-Nev., of inflating the savings in his competing $2.7 trillion plan by using accounting gimmicks that are achieved by the winding down the wars, but Reid's plan has not yet been scored.
Relative to the March baseline, CBO estimates that Boehner's plan would return about $695 billion in savings from discretionary spending, $20 billion from mandatory spending, and $135 billion in savings on interest paid on the public debt due.