Supercommittee Profile and the Odds of Success

Regular readers know that we have been following the deficit issue and the debt ceiling debate very closely.  It is a daily topic of discussion around our office.  The work of the Supercommittee will be interesting for students of politics, since it constitutes a somewhat novel experiment.

To launch our coverage, we present this profile of the members.  While I endorse the description, the background research and writing is the work of my son, Derek, who is a poli sci student at Illinois.  I have added my own fearless forecast at the conclusion.

The Supercommittee Snapshot -- by Derek Miller

A main provision in the debt ceiling deal signed by President Obama is the creation of a 'supercommittee' to find a $1.5 trillion more in cuts to the deficit by November. Otherwise, an automatic $1.2 trillion in cuts is triggered - something neither party particularly wants.

Now that the appointment process has been completed, the committee is really starting to take shape. Citizens and investors alike should be very interested in the representatives' initial attitudes and positions.

Senators:

Senate Finance Committee Chairman Max Baucus (D-Mont.): Baucus has something of a bad reputation among many in his own party. The Washington Post notes that Baucus "was the only Democratic senator on the Simpson-Bowles commission who did not support the final product" - which was  a mix of cuts to Social Security, Medicare/Medicaid, discretionary and defense spending, as well as revenue increases via tax reform. Among his objections were the elimination of farm subsidies and deep cuts to entitlement programs; it is reasonable to expect him to defend these programs with similar enthusiasm over the coming months.

Sen. Patty Murray(D-Wash.): Murray currently serves as the chairwoman of the Democratic Senatorial Campaign Committee, therefore her appointment has been met with criticism by those across the aisle. RNC Chairman Reince Priebus was particularly outspoken about her appointment, saying "The Select Committee is no place for someone whose top priority is fundraising and politics." While she certainly has strong incentives to make Democrats look good for the 2012 elections, it is likely that she will gauge taking action to be more politically popular than gridlock.

Sen. John Kerry (D-Mass.): Kerry is seen by Republicans as a fierce partisan, given his recent anti-Tea Party statements ("I believe this is without question the Tea Party downgrade"), not to mention his status as the 2004 Democratic presidential nominee. However, he has liberals worried that he will bargain away too much. The senator's spokesperson said today that "Kerry’s got a bipartisan track record on issues big and small including building consensus on issues that had defied all consensus," which strongly suggests he will attempt to forge a conciliatory deal in the Supercommittee.

Senate Republican Whip Jon Kyl*(Ariz.): Jon Kyl is one Republican who almost certainly not break the party line in these upcoming negotiations. In a recent interview with The Arizona Republic Kyl said: "“Whatever we do, we’ve got to be careful that we don’t hurt the prospects for economic recovery and job creation. In fact, we should be doing things that support job creation, and that’s one of the reasons why we don’t want to be raising taxes.” However, he is adamant that the Supercommittee not fail completely, as the default cuts fall heavily on defense spending - and national defense is one of his major issues.

Sen. Pat Toomey*(R-Pa.): By all accounts Toomey seems genuinely dedicated to getting something done in the Supercommittee. On Fox Philadelphia this morning he remarked that "There's a real, genuine desire to get something accomplished here." It appears as though he will toe the line with Jon Kyl in stating any revenue increases  would prove counterproductive to job growth - although he has characterized the tax code as "indefensible."

Sen. Rob Portman* (R-Ohio): Portman is relatively new to the Senate, but has experience in this area as the former White House budget director for George W. Bush. He is known to be slightly more moderate than Toomey or Kyl. According to the Colombus Dispatch he may go along with opening new sources of revenue in order to cut the deficit - despite having taking the Grover Norquist Taxpayer Protection Pledge.

Congressmen:

Rep. Chris Van Hollen (D-MD): Though Van Hollen has the least experience on Capitol Hill, Politico reports that he "played a central role in the debt-limit negotiations that averted a default." He has a reputation as an eloquent speaker who is able to communicate the party message effectively. All Democratic appointees have been urged by the Blue Dogs to "develop a fair and feasible path to fixing out long-term debt." Given Van Hollen's ambition for leadership, it appears likely that he will be willing to compromise.

Vice Chairman of the House Dem Caucus Xavier Becerra (D-Cali): Becerra has experience in this area, having been a member of the Simpson-Bowles deficit commission. He has a relatively safe seat in a liberal district, and is in fact one of the most liberal Democrats in the House. According to The Hill, Beccera has lately been "the party's loudest advocate for shoring up the Social Security program without eroding any benefits." All indications are that he will remain steadfast in his defense of entitlement programs.

Rep. James Clyburn (D-SC): Clyburn, the third highest ranking House Democrat, brings 20 years of experience to the table - including several in the House Appropriations Committee, which is famous for it's tendency to produce bipartisan compromise deals. Clyburn is particularly close to Pelosi, so it is reasonable to think that he will likely try to represent her negotiating spirit. Last week Pelosi stated that her objective was  "to be as forceful as possible and as unified as possible to send a message to the American people about what the difference is here" but also not to "[draw] lines in the sand."

Republican Conference Chairman Jeb Hensarling*(R-Texas): Hensarling was a member of the President's debt commission, but opposed its final result because it contained revenue increases. According to the Miami Herald he is "one of the most avowed fiscal conservatives in Congress," a characteristic sure to stand out as he co-chairs the Supercommittee.

Ways and Means Committee Chairman Dave Camp* (R-Mich): Camp has taken a surprising opening stance towards the upcoming negotiations. According to The Hill, Camp says "Everything is on the table," suggesting that there may be some scenarios in which revenue increases could help spur economic growth. However, he has pledged not to raise taxes, and a Ways and Means Committee spokesman maintains Camp has not changed his position on new revenues. It is certain that he will be under serious pressure for Norquist's group if indeed he does agree to raise taxes.

House Energy and Commerce Committee Chairman Fred Upton (R-Mich): Upton is particularly notable because he is the only Republican representative not unilaterally opposed to revenue increases. He has been criticized often within his own party for crossing the aisle on a number of high-profile issues, notably vying for increases in discretionary stimulus spending and attempting to decrease the Bush Tax Cuts. Steve Kornacki of Salon.com notes that Upton has been under fire from Tea Partiers as of late, suggesting that the appointment to the Supercommittee may be an attempt to pressure him into more conservative positions.

*Denotes representatives who have taken the Grover Norquist Taxpayer Protection Pledge[PDF]. This pledge requires that the representative "oppose any and all efforts to increase the marginal income tax rate" and "oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates." Simply put, these representatives have promised to oppose any and all revenue inceases proposed to cut the nation's deficit.

While most major news outlets and political commentators do not expect much from this Supercommittee, its members have serious incentives at play. Almost nobody wants the default $1.2 trillion in cuts to take effect. In combination with the potential political benefits of overcoming 'business as usual' in Washington, it is clear that many lawmakers see an advantageous end game.

Jeff's Odds on the Outcome

Derek has done a nice job of showing the diversity and biases of the Supercommittee members.  He accurately notes that most observers see a probable deadlock from this group.  They believe there is too much disagreement, and little has changed from the debt ceiling debate.

Everyone seems to be missing a key point.  There is an advantage to making sure that potential dissenters have a role in the process.  It then becomes easier to sell the final deal to the entire legislative body.  The sharp divergence in viewpoints was essential for this to have any chance of working.  By contrast, the twists and turns of the debt ceiling debate played out in a way that some important group always felt left out of the process.

While I plan to give this more thought, my early line is 2-1 that the Supercommittee will reach an agreement.  If they do, I expect it to become law.

Comments

[oldprof]

Jack -- I think there will be further negotiations before the "Bush" tax cuts expire. I expect most to be extended.

It is the nature of compromise that everyone is disappointed with the outcome.

Jeff

[Jack Reacher]

2-1 is probably about right. But I am cynical enough to believe the committee was designed to now come to an agreement.

So, we are out the 2 Trillion dollars. And much higher taxes starting 1/2013.

Way to negotiate, republicans.

[FedUp]

Pat,

Since i'm sure you're VERY familiar with the Constitution. I'm sure you're aware that creating and passing budgets are the responsibility of Congress. (NOT the execuetive branch)

However, since Congress can't seem to put Country ahead of party it would be nice to see an adult lead them to the correct answer. However, given the separation of powers, there's not much the President can do. Aside from a speech or two.

Unfortunately the best way for each side to play the game politically is to have no deal and then attempt to blame it on the other side in time for 2012.
Thus proving that our system has become so disfunctional that they care more about be re-elected than actually governing the country.

[Pat]

PS. final thoughts cut off: "The core problem is that you need a President to LEAD and do the consensus-building and not delegate leadership to a committee. Obama hasnt done that."

PPS. Thanks for indulging my overlong comment!

[Pat]

Jeff, I appreciate your economic insights and your valuable commentary. Some points that I think you are missing on this item.

First, it is NOT good news that a Republican is off the cut-entitlements bus. While this is simply a pro forma statement of Republican talking points, that they have not and will not cut current benefits, being 'gun shy' on this means no real substance in any 'deal'. The real reason a 'grand bargain' never happened, and you need to fight through the clutter of DC spin and media bias to get to the kernel of truth, was that wannabe-Speaker Pelosi and Senate Democrats said no to entitlement reforms, and gave Obama a dressing down over this in July when news came out of discussions with Speaker Boehner on it. It's why Obama 'moved the goalposts' Speaker Boehner saw he was being taken for a ride and got off the bus, cutting off any hopes for the 'big deal'.

The dynamic of Democrat refusing any compromise that 'solves' entitlements exists because they want "Medi-scare" as a 2012 issue. On the flip side, if the Republicans see no reasonable Democrat effort on entitlements, they have no incentive to cave/agree on tax hikes, the grand bargain quid pro quo. Poof, no grand bargain, no serious budget reform.

That leaves the super-committee to either (A) fail to reach agreement, posturing ensues, Pelosi/Reid use it to blame 'intransigent' Republicans, etc. (could be their plan all along); (B) they put tax hikes and entitlements aside, and come up with a deal to mainly cut from discretionary accounts ( maybe a nick on entitlements and a few tax credit reductions, nothing more).

(B) is not as hard as it looks because they are needing to find $1.2+ T or so in cuts in a $40 TRILLION 10-year budget. Is 3% that hard? Senator Coburn had about $9 trillion in cuts in his proposal. Simpson-Bowles had $7 trillion or so. The ideas are out there, its just a matter of deciding to agree to cut Government spending.

But when you have someone like Sen Baucus, who opposed Simpson-Bowles final report, which you report above thus: "Among his objections were the elimination of farm subsidies and deep cuts to entitlement programs" ... it's hard to see how meaningful budget reductions will get such spending-addicted Democrats on board.

And while the Republicans had a mix of viewpoints on their side,the Democrats picked all liberals, a signal of a hard line.

Moreover, if the Democrats do come up with a plan and peel off Moderate Upton and Portman, and leave fiscal hawks Toomey and Hensarling out of it, then the 'deal' will be DOA in the House with the conservatives in GOP caucus. The Toomey / Hensarling position is the "Cut, Cap and balance" approach, the very one the Democrats rejected.

Bottom-line: I think expectations for a serious common-ground result of this are low for a reason. As with the July debt deal negotiations, posturing trumps consensus-building and any deal might well be voted down in the Congress. The core problem is that you need a President to

[oldprof]

Thanks, Paul.

Once again, this is an out-of-consensus prediction, where I could be wrong. I'll monitor.

Jeff

[Paul Nunes]

This article is one more example wy i find your blog so valuable; i very much value your insight on political outcomes. great work jeff and derek!