Congressional Deficit Reduction Committee Fails to Reach Deal

Yesterday the Congressional supercommittee was not able to reach a deal and ended their deliberations. The Committee bowed to reality and disbanded. Because the Joint Select Committee on Deficit Reduction couldn’t come to an agreement, $1.2 trillion in automatic spending cuts are on track to begin in 2013, with roughly half coming from the Pentagon.

Many proposals were considered however the two sides were unable to bridge a fundamental divide over taxes and cuts to key safety net programs. Initially House Republicans proposed repealing President Obama’s health care law, implementing the controversial House GOP budget drafted by Rep. Paul Ryan (R-Wis.), saving $700 billion by block granting Medicaid, cutting $400 billion in mandatory spending, slashing another $1.4 trillion in other health care mandatory spending, saving $150 billion by slicing the federal workforce and putting a $60 billion cap on tort reform. All of which is adamantly opposed by Democrats. Republicans were no more pleased to see what Democrats wanted: the president’s $447 billion jobs bill plus well over $1 trillion in new taxes. As talked progressed each side moved away from these initial positions but never overcame the critical philosophical differences over taxes and cuts in entitlement programs.

The failure of the super committee will now lead to $1.2 trillion in across-the board cuts, with some programs serving low-income families being protected, including social security, medicaid, and food stamps. Some members of Congress are scrambling to repeal or revise these planned cuts, especially supporters of military spending. Responding to alarms by Secretary of Defense Leon E. Panetta, Sens. John McCain (R-Ariz.) and Lindsey Graham (R-S.C.) are drafting legislation to prevent cuts in Pentagon spending. Democrats are likely to try to roll back cuts in domestic spending. President Obama says he opposes tampering with the trigger and has issued a veto threat of any legislation to do away with the automatic cuts.

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