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For Pre-Election Sequestration Deal, Time Is Up

Sep. 18, 2012 - 01:12PM   |  
By JOHN T. BENNETT   |   Comments
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The likelihood of a deal to avoid $500 billion in Pentagon spending cuts before Election Day is wafer thin, with Republicans and Democrats still far apart on a range of fiscal issues.

Interviews with lawmakers from both parties and comments by senior Obama administration officials show the two parties have made little progress to find common ground on tax rates, entitlement reform and defense budgets.

“I doubt seriously it’s going to happen before this election,” Sen. Orrin Hatch, R-Utah, told Defense News late last week. “And it may not happen postelection.”

Hatch could be a key player in striking a grand bargain on a host of fiscal and budgetary issues because he is the ranking member of the upper chamber’s Finance Committee, which oversees federal tax policy.

Lawmakers are up against a Jan. 2 deadline to pass legislation that slashes the federal deficit by $1.2 trillion. If they fail, twin $500 billion cuts to planned Pentagon and domestic budgets would kick in under a process called sequestration.

Most lawmakers interviewed last week by Defense News agreed that because the House is slated to be out of session to allow for stretch-run campaigning, time has essentially expired for reaching a grand bargain or a temporary measure that would delay the automatic cuts several months.

Sen. John McCain, R-Ariz, Senate Armed Services Committee ranking member, has raised the notion of passing a bill that would delay the automatic cuts by three months. Other lawmakers have talked of a slightly longer delay.

For his part, Hatch favors putting the sequestration cuts on hold a full 12 months.

“I prefer a year, and really dedicate it — the administration and Congress — to passing tax reform,” Hatch said.

Sen. Claire McCaskill, D-Mo., an Armed Services Committee member, said, “sequestration won’t happen. I think there will be some kind of compromise that will occur. But probably not until after the election.”

McCaskill said a group of a dozen or so senators from both parties are quietly in talks about what might compose a massive debt-reduction package. Senate Armed Services Committee Chairman Carl Levin, D-Mich., told reporters last week he is “involved in discussions,” adding that other senators also are holding informal talks.

But sequestration-avoidance will require both chambers’ approval. So what kind of talks are going on among House members? “None, to my knowledge,” said one senior House lawmaker, who requested anonymity to speak bluntly.

House Armed Services Committee member Rep. Hank Johnson, D-Ga., told Defense News he is not involved in any negotiations and “hasn’t heard of any talks that are going on in the House.”

A senior GOP House Armed Services Committee aide, during a Sept. 14 conference call with reporters, appeared to quash any lingering hopes for a pre-Election Day deal.

“We’ll return in the lame-duck [session] and hope we can get the Senate to come up with their own plan” for avoiding sequestration, the aide said, noting the House has approved several measures that would do just that.

But none of those bills, which all passed largely along party lines, are going anywhere in the Senate.

In interviews and public statements, senior congressional Democrats continue insisting they only will support a “balanced approach” that includes tax hikes on the wealthiest Americans and more federal spending cuts.

House Minority Leader Rep. Nancy Pelosi, D-Calif., during a Sept. 13 floor statement, called legislation the lower chamber approved last week that would require the president to replace the planned $500 billion in Pentagon cuts “silly” and “a mirage.” That measure would have kept in place cuts to domestic programs such as Medicare, angering congressional Democrats and the White House, which warned President Barack Obama would veto the measure.

In a separate Sept. 14 conference call, comments by senior Obama administration officials cast a light on how far apart the two sides stand — even as defense officials and economists warn of the national security and economic travesty that would be sequestration.

“Republicans have been unwilling to compromise,” one senior administration official told reporters. GOP lawmakers have been open to “no area of compromise on revenue.”

In one of the most bitterly partisan times for Washington in recent memory, the two parties have been talking past each other for nearly two years. That continued Sept. 14, with the HASC aide saying “everything [House lawmakers] have done is defense and nondefense — it resolves everything.”

Several hours earlier, the agitated-sounded administration official noted the August 2011 legislation that set up the threat of the $500 billion Pentagon cut “was passed by Congress, including a lot of Republicans who celebrated it.

“Now that the rubber is hitting the road, they are backing off a deal they made … and that they celebrated,” the senior White House official said.

“The Republicans want to walk away from a deal they made with the president and with themselves.”

Despite the partisan shot-taking, the HASC aide urged the Senate to act on some kind of sequestration-killing bill, saying that is the lone way to get House-Senate conferees into a room to try and hammer out a final version to send to Obama.

“Let’s get something passed out of the Senate,” the committee aide said, “and then we’ll take a look.”

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