Deficit reduction talks break down

By Michael Catalini

November 20, 2011

All but acknowledging the end of talks, Republicans and Democrats on the deficit super committee used Sunday television appearances to blame each other for their looming failure to bridge political differences over taxes and spending.

Unless there's a surprise last-minute breakthrough, the committee will miss its Wednesday deadline to propose $1.5 trillion in cuts, triggering automatic cuts of $1.2 trillion, half of which target the Pentagon.

"It's going to be tough given where the clock is," Sen. Pat Toomey, R-Pa., said on CBS's Face the Nation.

The deadline may be Wednesday, but the panel would have to produce something by Monday to accommodate the legislative process.

The talks, members said, broke down over taxes and entitlements. Republicans, Democrats said, were reluctant to let the Bush-era tax cuts expire, and Democrats, Republicans said, did not give enough on entitlement reform.

"The truth is at this point today Democrats have made some really tough decisions and come to some pretty tough choices that we're willing to put on the line … but only if the Republicans are willing to cross the line on the Bush tax cuts," committee cochair Sen. Patty Murray, D-Wash., said on CNN's State of the Union.

Sen. Jon Kyl, R-Ariz., cited a Republican plan that called for $640 billion in cuts, nearly half of the committee's target, that would delay the rest of the cuts until next year, but said Democrats torpedoed it.

"The Democrats said no, because it didn't raise taxes .... In Washington there is a group of folks that will not cut a dollar unless we raise taxes," Kyl said on Meet the Press.

Toomey also pointed to the so-called go-small approach that Kyl referenced, suggesting that Republicans had made a good-faith attempt at reaching agreement.

"There is still an opportunity. There's a plan on the table that would at least take us halfway to our goal ... it's on the shelf; it's been scored; it's ready to go. If the Democrats would agree to that we can still get something done," Toomey said, referring to a proposal that surfaced last week.

As talks turned to the likelihood of the panel's failure and the possibility of automatic cuts-known as a sequester in legislative terms-Democrats and Republicans disagreed about whether the cuts would occur and what the consequences of intervening with sequestration would be.

"We do have the opportunity, even if the committee fails, to work around the sequester," Kyl said. Sen. John Kerry, D-Mass., said if there is no deal and the Republicans try to roll back the sequestered budget cuts in separate legislation the result will be another debt downgrade for the United States.

Toomey, though, suggested the automatic cuts would be beneficial.

"The silver lining is that we're going to get the spending cuts anyway. That was designed into the bill that created the committee. ... The $1.2 trillion in spending cuts, however, I think need to be reconfigured. They're done in a way that would be very harmful to our nation's defense," he said.

For now, the members seem able only to agree to disagree.

"I'm not saying it's anybody's fault," cochair Rep. Jeb Hensarling, R-Texas, said on Fox News Sunday. "We've got people with very different views frankly of what it takes to produce jobs and what it takes to produce economic growth."

Michael Hirsh contributed to this report.

By Michael Catalini

November 20, 2011