Boehner’s Counter: What Is It?

Today’s big news is a written fiscal proposal by Congressional Republicans. The press describes it as a counter to “President Obama’s deficit reduction proposal,” but that is incorrect. Obama hasn’t made an offer concrete or credible enough to be described as a proposal. The Boehner offer is contained in a three-page letter to the President, signed by six Republican House leaders along with Boehner. You can read it here.

The Republican offer is more concrete than anything President Obama has come up with, but that is damning with faint praise. This is how Boehner and the others present their proposal in the letter:

So we get $800 billion by eliminating deductions, but which ones? And spending is to be cut by $1.2 trillion, but what spending? Boehner properly refers to these numbers as a “framework” for negotiation. I thought that Bowles’s November 1, 2011 testimony would elucidate such details, so I tracked it down. You can read it here. Unfortunately, Bowles wasn’t a great deal more specific than Boehner. Here is Bowles’s description of his proposal, which he described as a compromise between the positions that were then staked out by Republicans and Democrats, as opposed to the more thorough-going reforms of the Simpson-Bowles plan, in its entirety:

Chairman Hensarling. Thank you. The gentleman yields back. All time for Member questions has concluded.

However, I would note, prior to Senator Simpson’s departure, he did mention, Mr. Bowles, that you had something you might want to present. Without objection, I would certainly yield you a couple of minutes if I understand you have something else you wish to present to this committee.

Mr. Bowles. I can do it very quickly. I tried to think, if I were sitting in your shoes or I was the go-between as I was in the what became the Simpson-Bowles plan, if it was possible for you all to get to the $3.9 trillion deficit reduction, given where your positions are today, and I think it is, I think you can get this done, and I will just go through briefly the arithmetic. And, again, you have got to flesh out the policies, but if you look at where I understand the two sides now stand, and this is from just listening, which is what you have got to do if you are the guy in the middle, you know, the proposals for discretionary spending, and these are all above what the $900 billion and the 400 that was in the continuing resolution, so this is in addition to the $1.3 trillion worth of spending cuts that have already been done, but you all are between $250 and $400 billion of additional cuts on
discretionary, so I assumed that we could reach a compromise of an additional $300 billion on discretionary spending cuts.

On health care you are somewhere between $500 and $750 billion of additional health care cuts. I assumed that we could get to $600, and I got there by increases in the eligibility age for Medicare that I discussed with Senator Kerry when he was talking to me. That is about $100 billion. That would take you from the 500 where the Democrats are to $600 billion, and it happens to come not on the provider side, which I think would kind of balance that out.

On other mandatory cuts, you are somewhere between 250 and 400, so I settled on 300 there, and we had enough cuts in our plan to get you to 300 on the other mandatory. Interest will obviously just fall out at approximately 400 billion, the savings there. You agreed actually on CPI in your two plans of approximately $200 billion. The total of that is $1.8 billion.

That left me a little short.

That gets me to revenue. And on revenue I took the number that the Speaker of the House, I had read had actually agreed to, and I was able to generate $800 billion through revenue from the Speaker’s recommendation, and if you did that without dynamic scoring, but you did it, and, you know, on dynamic scoring I am kind of on the Reagan plan, trust and verify, which we talked about earlier. If it actually comes, great, you will use it to reduce rates or you will use it to reduce the deficit. But if you add the $800 billion there and you do that slightly on a more, make it so the code is slightly more progressive after you have done it than before, then I think you have really got something that you might be able to work with the Democrats on.

That would give you an additional total of $2.6 trillion added to the 1.3 you have already done. That is $3.9 trillion in deficit reduction, and I think that would create a lot of excitement with people in the country, and I think it would go a long ways toward building up confidence that we really could stand up to our problems.

I’m not so sure about the excitement part. Basically, Bowles’s proposal is just a series of numbers intended to represent a compromise between the parties’ positions. He was hardly any clearer about where the money was to come from than was today’s letter by House Republicans.

So, what should we make of Boehner’s latest move? On the plus side, he has put an offer on the table, and done so publicly. This at least stakes out some kind of position and is certainly better than closed-door, secret negotiations. Presumably the offer will generate some pressure on President Obama to come forward with a more meaningful proposal than was communicated by Tim Geithner.

The biggest problem with the House’s gambit is that the GOP proposal is so unmemorable. Everyone knows what Obama’s position is: close the deficit by raising taxes on the “rich.” Of course, those who are at all knowledgeable realize that we don’t have anywhere near enough rich people for that to work. But most people, living in blissful ignorance, probably think Obama’s position makes some kind of sense. How does one sum up the GOP’s position? As set forth in today’s letter it is not, to say the least, catchy.

What makes the Republicans’ position reasonably tenable is that polls consistently show that most Americans think the federal government spends too much money, and does so inefficiently. Most Americans say they would rather see spending cuts than tax increases. So if John Boehner and the rest can define their disagreement with Obama in simple terms–he wants to solve our budget problems by raising taxes, while we want to solve them by getting our spending under control–they will be playing to a reasonably receptive audience. But they have to define a clear and simple message before they can begin the process of selling it to voters.