Earlier this month, Congress passed and the President signed into law the Budget Control Act. A key component of this legislation prevents an additional hike in the federal debt limit without a matching cut in federal spending equal to or greater than the amount of the increase or accompanied by a balanced budget amendment to the Constitution.
To accomplish these budget cuts, the Budget Control Act established a “Joint Select Committee on Deficit Reduction.” As mandated by law, the joint committee is composed of 12 members of Congress, 6 from each Chamber. The following appointments were made: Senators Max Baucus (D-MT), John Kerry (D-MA), and Patty Murray (D-WA) by Majority Leader Harry Reid (D-NV); Senators Jon Kyl (R-AZ), Pat Toomey (R-PA), and Rob Portman (R-OH) by Minority Leader Mitch McConnell (R-KY); Congressmen Fred Upton (R-MI), Dave Camp (R-MI), and Jeb Hensarling (R-TX) by Speaker of the House John Boehner (R-OH); and Congressmen James Clyburn (D-SC), Xavier Beccera (D-CA), and Chris Van Hollen (D-MD) by Minority Leader Nancy Pelosi (D-CA).
The joint committee is charged with the goal of reducing the federal deficit by an additional $1.5 trillion. The committee members have an enormous task at hand and must follow a strict timeline. They have until Thanksgiving to produce and to vote on legislative language that reduces the deficit by at least $1.2 trillion. The reported bill must be accompanied by Congressional Budget Office estimates. A majority—seven of the twelve members—of the committee is required to approve the package. If approved, their draft legislative language must be introduced in the House and Senate and then be voted on by December 23 and passed before going to the President’s desk for his signature. The law mandates transparency in the process. The final report and legislative language must be made public, in addition to the dates, times, and subject matter of all related hearings.
The Congressional Budget Office baseline estimate under current law will be used to establish the joint committee’s recommendations. Therefore, the committee cannot count revenue from increasing taxes or from expiring tax rates as savings and contribute those savings to their overall level of required deficit reduction. In effect, this baseline requirement prevents massive tax increases from being included in the committee’s final proposal. The committee must identify at least $1.2 trillion in real cuts or savings.
Whether or not the Committee succeeds in identifying at least $1.2 trillion, time will tell. As many have expressed with high hopes and low expectations, and I concur, identifying and agreeing to these cuts will be a challenge. One thing is for certain though—at least $2.1 trillion total in deficit reduction over the next ten years will be achieved. The Budget Control Act has built in safeguards to ensure that if the committee fails to produce legislation with $1.2 trillion in cuts, cuts up to this magnitude will happen automatically. While sequestration is not the optimal solution desired by either end of the political spectrum, across-the-board cuts will be triggered to achieve deficit reduction should the Committee fall short of the required target or fail to produce a report that would pass both chambers by the December 23 deadline.
I also want to clear up the misconceived notion that this committee is a “super-committee” with no oversight and no accountability. It is a Joint Select Committee, established for a particular purpose for a particular time. The Deficit Reduction Committee is similar in structure to the House Permanent Select Committee on Intelligence or a Conference committee, which is a temporary panel of House and Senate Members, whose purpose is to reconcile differences in legislation that has passed both chambers. While the Deficit Committee has received more press and attention than other joint or select committees, it does not have any special powers. In fact, while the joint committee only comprises 12 members of Congress, all Members of Congress, House and Senate Committees, and yes, the American people, can play an active role in the committee’s process. As I stated before, all recommendations from the committee will have to pass both bodies of Congress and be signed by the President before becoming law.
It is no shock that we are where we are today. People can point fingers at both parties, and rightly so, but Washington has a spending problem, and has for decades. We did not get here overnight, and we will not get out of this debt crisis overnight. The federal debt has continued to build up over the years, and this Congress and the American people have decided that enough is enough.
Since the beginning of this Congress, House Republicans have taken the lead in conducting strict oversight over federal agencies. The Budget Control Act, while by no means perfect, is a step in the right direction. Instead of sending the President a blank check absent any control, this law puts our bloated deficit on a diet, constrains future spending, and paves the way for future reform. The joint committee and Congress have the opportunity to not only identify cuts of $1.5 trillion to reach its statutory goal, but to surpass it with further cuts. It is time to regain control, rein in the government spending, and get serious about our country’s future.
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