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The Gang of One: Conrad Introduces His Own Budget Plan

We're not a gang, we're a club! Sen. Kent Conrad (D-ND)

The Gang of Six was always going to be a dicey proposition. I don’t know if you’ve figured this out yet, but Republicans and Democrats don’t agree on a whole lot. So getting a mini-version of the Senate to agree to $4 trillion in spending cuts and revenue increases looked impossible. And guess what, it was.

A bipartisan effort to rein in the national debt stalled Tuesday, as members of the Senate’s so-called Gang of Six signaled that an agreement is unlikely to come this week in time for the start of White House-led budget talks.

The absence of a deal deprives policymakers of a bipartisan centerpiece that could smooth the way toward agreement in the contentious battle between Democrats and Republicans over the appropriate size and shape of government.

Members of the Gang of Six said Tuesday that they are continuing to meet daily and that a deal is still possible. However, one of the six, Sen. Tom Coburn (R-Okla.), left town abruptly Tuesday because of a family emergency, leaving lawmakers and the White House to begin negotiations over whether to allow the government’s debt to keep rising without a bipartisan starting point.

Senate Budget Committee Chair Kent Conrad, a member of the Gang of Six, felt like he couldn’t wait any longer. Bicameral, bipartisan meetings begin tomorrow with Vice President Biden, and without a budget plan, only House Republicans would come to that meeting with a baseline to share. So Conrad submitted his own budget resolution. It’s basically Simpson-Bowles without the Social Security changes. It would cut $4 trillion from deficits over the next decade, with $1 trillion from an overhaul of the tax code that would lower rates and broaden the base by eliminating loopholes and deductions, and $3 trillion from spending. Conrad wants to bring it to a committee vote next week.

Democrats are livid.

“He’s going to be a man without a country,” the Democratic aide said, describing a contentious Tuesday briefing.

The problem for Democrats is that, rather than put down a firm Democratic marker from which the party can negotiate, Conrad has adopted a plan that resembles the work he’s done with legislators across the aisle.

In bringing it forward himself, Conrad sets the starting point for the Democratic position in a more conservative spot than President Barack Obama’s budget — and that was already a compromise. Obama’s plan includes a spending freeze for federal workers, among many other concessions to the GOP.

“He’s setting this out like it’s the official Democratic position,” a Democratic staffer said. “I don’t know if this can pass his own committee without major changes.”

The Gang of Six simply didn’t finish the job, and indeed, it was built to not finish the job, with Republicans desirous to drag out talks so Senate Democrats looked like they didn’t have a plan. In this sense it was no different than the Max Baucus-led Gang of Six on the health care law. So Conrad is becoming the Gang of One. He’s basically carrying Bowles-Simpson. The lack of changes to Social Security is a relief, but the plan overall is right of center. It has a 3:1 spread on spending cuts to revenue hikes. Moreover, there’s no guarantee that Republicans will come aboard, leaving Conrad truly as a Gang of One, without a unified Democratic Party or key Republicans behind him. [cont’d.]

The President’s outline from his fiscal policy speech cuts the same amount over a longer time horizon of 12 years. So in one sense, Conrad is to the right of Obama, although we don’t know the breakdown in military spending, and Medicare isn’t really touched in Conrad’s plan, according to early reports. There’s no specific spending target, for example, a feature of Obama’s and Paul Ryan’s budget proposals.

I don’t agree with Steven Pearlstein’s conception of how a compromise should go, but it’s notable that he outlines an endgame with half of the savings coming from revenue and half from spending, when the Obama plan is at least 2:1, the Conrad plan is 3:1, and the Ryan plan is all spending. In this environment, the People’s Budget from the Progressive Caucus should be the counterpoint, with its savings all from tax increases and military spending. But that would be too sensible for Democrats.

Republicans are unified behind a deeply unpopular approach that would destroy Medicare and Medicaid. Democrats are not unified at all, and now have a standard bearer in Conrad putting forward a plan the caucus doesn’t like.

This is not a good start to these negotiations.

CommunityThe Bullpen

The Gang of One: Conrad Introduces His Own Budget Plan

The Gang of Six was always going to be a dicey proposition. I don’t know if you’ve figured this out yet, but Republicans and Democrats don’t agree on a whole lot. So getting a mini-version of the Senate to agree to $4 trillion in spending cuts and revenue increases looked impossible. And guess what, it was.

A bipartisan effort to rein in the national debt stalled Tuesday, as members of the Senate’s so-called Gang of Six signaled that an agreement is unlikely to come this week in time for the start of White House-led budget talks.

The absence of a deal deprives policymakers of a bipartisan centerpiece that could smooth the way toward agreement in the contentious battle between Democrats and Republicans over the appropriate size and shape of government.

Members of the Gang of Six said Tuesday that they are continuing to meet daily and that a deal is still possible. However, one of the six, Sen. Tom Coburn (R-Okla.), left town abruptly Tuesday because of a family emergency, leaving lawmakers and the White House to begin negotiations over whether to allow the government’s debt to keep rising without a bipartisan starting point.

Senate Budget Committee Chair Kent Conrad, a member of the Gang of Six, felt like he couldn’t wait any longer. Bicameral, bipartisan meetings begin tomorrow with Vice President Biden, and without a budget plan, only House Republicans would come to that meeting with a baseline to share. So Conrad submitted his own budget resolution. It’s basically Simpson-Bowles without the Social Security changes. It would cut $4 trillion from deficits over the next decade, with $1 trillion from an overhaul of the tax code that would lower rates and broaden the base by eliminating loopholes and deductions, and $3 trillion from spending. Conrad wants to bring it to a committee vote next week.

Democrats are livid.

“He’s going to be a man without a country,” the Democratic aide said, describing a contentious Tuesday briefing.

The problem for Democrats is that, rather than put down a firm Democratic marker from which the party can negotiate, Conrad has adopted a plan that resembles the work he’s done with legislators across the aisle.

In bringing it forward himself, Conrad sets the starting point for the Democratic position in a more conservative spot than President Barack Obama’s budget — and that was already a compromise. Obama’s plan includes a spending freeze for federal workers, among many other concessions to the GOP.

“He’s setting this out like it’s the official Democratic position,” a Democratic staffer said. “I don’t know if this can pass his own committee without major changes.”

The Gang of Six simply didn’t finish the job, and indeed, it was built to not finish the job, with Republicans desirous to drag out talks so Senate Democrats looked like they didn’t have a plan. In this sense it was no different than the Max Baucus-led Gang of Six on the health care law. So Conrad is becoming the Gang of One. He’s basically carrying Bowles-Simpson. The lack of changes to Social Security is a relief, but the plan overall is right of center. It has a 3:1 spread on spending cuts to revenue hikes. Moreover, there’s no guarantee that Republicans will come aboard, leaving Conrad truly as a Gang of One, without a unified Democratic Party or key Republicans behind him.

The President’s outline from his fiscal policy speech cuts the same amount over a longer time horizon of 12 years. So in one sense, Conrad is to the right of Obama, although we don’t know the breakdown in military spending, and Medicare isn’t really touched in Conrad’s plan, according to early reports. There’s no specific spending target, for example, a feature of Obama’s and Paul Ryan’s budget proposals.

I don’t agree with Steven Pearlstein’s conception of how a compromise should go, but it’s notable that he outlines an endgame with half of the savings coming from revenue and half from spending, when the Obama plan is at least 2:1, the Conrad plan is 3:1, and the Ryan plan is all spending. In this environment, the People’s Budget from the Progressive Caucus should be the counterpoint, with its savings all from tax increases and military spending. But that would be too sensible for Democrats.

Republicans are unified behind a deeply unpopular approach that would destroy Medicare and Medicaid. Democrats are not unified at all, and now have a standard bearer in Conrad putting forward a plan the caucus doesn’t like.

This is not a good start to these negotiations.

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David Dayen

David Dayen