The Gang's All Here
The Gang of Six has been working on a fiscal plan for months now, and it appears that they are now ready to step into the debt debate in the eleventh hour. More positively, it looks like they may have a wide swath of support in the Senate.
Just this morning, the Gang unveiled its proposal to put the debt on a sustainable path to a group of 40 to 50 Senators. There, Sen. Tom Coburn (R-OK), just a day after releasing his budget plan, announced that he was back with the group. The reaction from the meeting has been very positive, with indications that the Gang of Six plan could pass the Senate. The Washington Post reported:
"President Obama on Tuesday praised a new bipartisan plan emerging in the Senate, calling it 'broadly consistent' with the White House’s approach to raising the debt limit and describing it as a 'very significant step.'
'We’re in the same playing field,' he said, speaking from the White House.
The ambitious plan to slice $3.7 trillion from the federal budget over the next decade was gaining momentum in the Senate on Tuesday, after more than 40 Republicans and Democrats attended a morning briefing on the proposal.
The plan, drafted by a bipartisan group of senators known as the “Gang of Six,” has been in the works for months. After struggling to reach consensus and apparently disbanding last week, the group now says it’s nearing agreement on a proposal, which could offer an alternative strategy for pushing an increase in the debt limit through Congress before the Aug. 2 deadline.
'We’ve gone from a Gang of Six to a mob of 50,' exulted Sen. Joe Manchin (D-W. Va.), as he emerged from the meeting. The proposal, Manchin said, 'shows great promise.'
'I will support it. It is a fair compromise,” added Sen. Kay Bailey Hutchison (R-Tex.). 'This is a way forward where we can do the work that we have come here to do.'
The details of the proposal are unclear so far, but the Gang has based its work off of the President's Fiscal Commission, which capped both security and non-security discretionary spending, reduced health and other mandatory spending, made Social Security sustainably solvent, and reformed the tax code to dramatically reduce rates, broaden the tax base, and make the code fairer and more efficient. The Gang's plan has been reported to save between $3.7 to $4.7 trillion depending on which set of projections it is compared to.
We are very encouraged by the support the Gang of Six seems to have in the Senate. CRFB president Maya MacGuineas said in a statement:
"If enough lawmakers are willing to stepup to the plate along with the Gang, it would renew our chances of getting a 'grand bargain' sufficient to reassure markets that we can put our fiscal house in order and to reassure the public that Washingon is still fit to govern. This is how Washington is supposed to work -- let's hope it does."
The Gang represents a real opportunity for a major bipartisan plan that sufficiently deals with our rising debt. If there is to be a grand bargain, it seems likely they will be the foundation for it given that they have been negotiating this proposal for months and know the ins and outs of where lawmakers can find consensus. Fiscal Commission co-chairs Erskine Bowles and Alan Simpson agree:
"[B]eyond the policy – good, balanced, bipartisan policy – today the Gang of Six offers us something more: hope. Hope that there is indeed an arena for bipartisan compromise on this crippling debt and these endless deficits. Hope that in fact Washington is not broken. Hope that America can continue to be great – something that won’t be possible if we go broke. Hope that a crisis can be averted and our children and grandchildren will continue to have the same opportunities and bright future we had."