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  • Baucus Commission Is No Solution for Spending

    The Senate this week is considering amendments to Majority Leader Harry Reid’s (D-NV) legislation to raise the debt limit.  Reid’s bill is a substitute to the version that passed the House, which would add $925 billion to the federal debt ceiling, but his would hike the limit by $1.9 trillion so that the Senate does not have to take another troublesome vote on the debt limit before the 2010 election.

    Raising the debt ceiling to some degree is, unfortunately, necessary to avoid a default with perhaps catastrophic financial consequences for America. But at least the legislation has focused attention on the need for Washington to control its spending behavior.  The issue is: What amendments can be added to the Reid bill to push Congress to face up to the spiraling fiscal problem?

    Early on Tuesday, the Senate voted down an amendment offered by Senators Judd Gregg (R-NH) and Kent Conrad (D-ND) which threatened to take the wrong approach by creating a commission to address our debt problem.

    Senate Finance Chairman Max Baucus (D-MT) made the prospect of any decisive fiscal action more remote by offering an amendment that would prohibit Congress from including Social Security in any budget legislation involving expedited procedures. Unfortunately, the Baucus amendment was agreed to by the Senate.

    Removing Social Security from the discussion may be good short-term politics, but it is the three big entitlements – Medicare, Medicaid, and Social Security – that are the major drivers of federal spending.  These three programs alone will cause spending to explode in the next few decades as the U.S. population ages and the cost of providing health care continues to climb.

    The fiscal crisis the nation faces cannot be addressed unless these programs are significantly reformed, but Senator Baucus’ amendment rules out one-third of the equation out if expedited procedures are used—even though tax increases, for example, could be implemented under such procedures.

    The Senate will very shortly vote on another Baucus amendment to create his version of a commission. If it is accepted by the Senate, a Bipartisan Task Force will be created to address the fiscal imbalance that threatens the financial future of our children and grandchildren. The task force he proposes is almost identical to the Conrad-Gregg version that has just been defeated. The only significant difference is that it removes that version’s requirement for Congress to use expedited procedures to consider the Commission’s recommendations.  Like Conrad-Gregg, the Baucus commission would not reveal its plan until just after the November election.  The plan could then be voted on by this Congress, including members who might well have lost their seats in the election because of their poor fiscal stewardship.

    The most likely the result of the Baucus commission would be no congressional action at all on entitlement reform—while carrying the risk that it would provide cover to raise taxes.

    This is the wrong way to conduct a commission, and it will do nothing to build the broad public support needed to confront the federal government’s spending addiction.

    Posted in Economics [slideshow_deploy]

    6 Responses to Baucus Commission Is No Solution for Spending

    1. Barbara Frances Delo says:

      It is just horrible to leave the next generation with the burden of an enormous debt. Just like thousands of households across America, our government must make sensible budgets, establish priorities, and apply restraint. However, be careful of targeting health related spending for cuts. Our health is certainly a priority. Our government has plenty of frills and many 'pork' programs that can be looked at first!

    2. Steve, Chicago says:

      A commission may be a bad idea that is simply better than any other idea. Yes, the Baucus amendment was a naked ploy to make the commission useless but the commission as proposed by Conrad and Gregg was a better idea than nothing.

      It's entirely possible a commission would fail but it is almost a metaphysical certainty that Congress, left to its own devices in an election year, will do nothing to address the long term fiscal health of the nation.

      As to the fear that a commission is only "cover" for raising taxes, of course it is. It's also cover for reducing spending. That's the point. You always have the option to vote against the recommendation but preventing it from coming to pass will not move the conversation forward.

    3. Ray Davenport Portla says:

      Please not another Baucas Caucas!

    4. Billy T., Kansas Cit says:

      Congress needs to bite the bullet and stop throwing good money after bad, like the TARP and the Stimulus, which worked so well. Now there is talk of another stimulus and another jobs bill. They also need to stop all of the earmarks, pork barrel spending, and their pay raises.

    5. Normca says:

      Looking for the same people to fix a problem, that they themselves caused, under any arrangement is like asking the hen to guard the hen house. They voted for and implemented the Community Reinvestment Act, they voted for the stim-pork bill, most voted for the Baucus health insurance bill, they sit back and allow this administration to deplete the private sector who pays taxes and therefore funds the government programs and they continue to take their costly trips. And Baucus is the biggest offender. This is smoke and mirrors. It gives them cover for big spending this year and delays action needed to address the entitlement problem described here. We need leaders like Daryl Issa, who actually ran a business and all the requirements. This band aid approach is the democrats way of responding to the citizens' uproar.

    6. Drew Page, IL says:

      Max Baucus, the guy who wanted to shove national health care down our throats, is now worried about the deficit? I guess the noise in Massachusetts can be heard all the way out to Montana.

      Now he wants a "bipartisan task force" to work on fixing the budget and deficit.

      I have a suggestion Max, before you start rounding up more foxes to guard the chicken coop, why don't you submit a bill that would take all of the unused TARP money and all unused Stimulus money and put it into the Social Security Trust Fund? Taxpayers are going to have to foot the bill for Social Security eventually, so why not put these unused funds into Social Security now? If this isn't done, there will be no limit on the number of "good ideas" Congress will come up with to spend this money on something else.

      How about thinking outside the box, Max, why don't you propose legislation that would roll all the funds in the federal employees' pension fund into Social Security and provide the same pension benefits for federal employees (including yourself) that the rest of America gets? Or are those of you in the government special people who somehow deserve better treatment than those you pretend to represent? But you won't do that, will you Max? No, you and your co-conspirators in government will continue to exempt yourselves from Social Security, just like you did for the national heath care you tried to dump on the rest of us. While over three million jobs have been lost over the past year, the government has added 64,000 jobs that taxpayers must fund. Yes, you folks in government are indeed "special" people.

      Congress cannot be trusted with the people's money. Unfortunately, it has been given the authority to spend it. No matter how you try to rationalize it, you people in the House and Senate have created these deficits with your reckless spending and now expect the American public to believe that you same people are going to repair the damage you have done.

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