House Budget leaders offer sequester, fiscal cliff strategies
February 13, 2013 | By Robert Weiner and Richard Mann | firstname.lastname@example.org
House Budget Committee Ranking Member Chris Van Hollen, D-Md., and Vice Chairman Tom Price, R-Ga., agreed that the recurring fiscal cliffs and sequestration are bad for the nation but disagreed on ways to stop them.
Price opened a unique bipartisan leaders' Feb. National Press Club Newsmakers event decrying the "magnitude" of the $16 trillion deficit -- "too many zeros."
An orthopedic surgeon, Price said that "if you didn't make the right diagnosis, the patient only got better by dumb luck."
"We have a spending debt crisis, not a revenue crisis," Price said.
Price wants Congress to address the rising costs of Medicare, Medicaid, and Social Security, and said that "the Senate ought to do a budget", which it has failed to do for three years.
"It's vital to get our fiscal house in order if we are to restore vitality," Price said. "You can't balance solely on raising taxes, you can't balance solely by spending cuts, you have to get the economy rolling. You have to have tax reform, an energy plan, and pro-growth economic policies."
Van Hollen and Price agreed that Congress should act now to end both the sequester and long-term deficits with a "mix" of spending cuts and tax reforms. When Van Hollen said there should be a vote on a comprehensive approach but the House leadership has not allowed one, Price said, "I wish there were a vote as well."
The House Democratic proposal "combines cuts and revenues designed to replace the sequester," Van Hollen said.
However, the two had serious differences in what should be included in the legislation.
"Our focus has to be on expanding economic growth, boosting job creation not only for people at the top, but for the middle class," Van Hollen said. "You can't say yachts will rise but all the other boats will run aground. We want rising incomes for everybody. You have to invest to maintain our competitive edge. That means K-12, college, vocational education, and investing in medical science and research, [National Institutes of Health] NIH, roads and bridges, and other places. We have to make good on our commitments for health and retirement security."
Van Hollen called the budget cuts that protect the top alone "short sighted" and labeled the fiscal cliff an "artificial crisis."
Price laid out the House Republican goals: "increase economic freedom, create economic opportunities for individuals and balance the budget within a 10-year period, so that we can create economic vitality and jobs."
"Revenue in our country in 2012 returned to its 10-year average," Price said. The solution to the deficit is additional spending cuts, not increased revenue," he added.
Van Hollen decried the philosophy of "cutting and austerity." He said that "the UK is now in a second recession. Good thing we didn't listen to their advice. We wouldn't have the job numbers."
Questions included whether the debt ceiling legislation that limits U.S. payments and freezes congressional salaries pending passage of a budget is even constitutional given the 14th Amendment stating that "the validity of the public debt of the United States shall not be questioned" and the 27th Amendment mandating that there is "no law varying the compensation for Senators and Representatives until an election shall have intervened."
Price said that the debt ceiling offers the opportunity for a "good conversation" to determine budget priorities, and Van Hollen said it was a "very legitimate question" as you look at the "words in the Constitution."
Other questions included whether what has been paid into Social Security and Medicare provide solvency despite government use of the money and whether their finances even count in the deficit. Both members agreed that Social Security and Medicare are long-term problems, but Van Hollen pointed out that it is incorrect to say either runs out of money soon.
"Social Security is 100% solvent until 2034" with "funds in the trust fund able to fully pay benefits until that date," and Medicare Part A (hospitalization) until 2024, and then after that day, "it's not as though the trust fund goes down to zero, the trust fund can still pay 75%," Van Hollen said.