Tom Coburn was more effective as
John Ensign's spiritual advisor than as
a budget deal negotiator.
Greg Sargent
reports that Tom Coburn quit (or
semi-quit?) the Senate's "Gang of Six" after Dick Durbin refused to accept Coburn's demand for $130 billion in Medicare benefit cuts on top of the $400 billion in savings already on the table.
According to the aide familiar with the talks, the senators got into a heated argument on Monday night, after Coburn demanded an additional $130 billion in Medicare, in addition to the $400 billion in Medicare cuts recommended by President Obama’s fiscal commission, for a total of $530 billion in cuts for current recipients.
The Huffington Post reported yesterday that the additional amount sought by Coburn was $130 billion, and that the number represented a new demand. TPM’s Brian Beutler put the figure at $150 billion.
“Coburn came in on Monday and said, `I want $130 billion,’” the aide says. “The conservation was heated. There was yelling. Durbin said, `I am not doing this. That destroys Medicare. That goes even further than Paul Ryan. We’re not doing it.’”
The conversation went on for three hours or so, the aide says, but the senators could not break the impasse. “Because Coburn couldn’t get his way, he walked,” the aide says. Coburn called Durbin on Tuesday to tell him he was pulling out.
It's important for Democrats to remember that even if the GOP refuses to agree to a "grand bargain," under current law, the deficit will mostly take care of itself, at least over the short and medium term. The reason: Bush tax cuts will expire at the end of 2012.
The fact that they will expire represents the Democrats' main source of leverage in the fiscal policy debate—as long as they are willing to let them expire. This doesn't mean Democrats need to endorse raising taxes on the middle-class (even if they should), but it does mean they can't approach the fiscal policy debate the way they approached the tax policy debate in 2010. If they let this become another hostage-taking situation, they will lose all their leverage, and they will be blackmailed again.
Instead, they should take the position that the tax rates can only be changed in the context of a broader agreement. If Republicans won't accept a balanced proposal, Democrats need to blame Republicans for raising taxes. It's possible, though unlikely, that Republicans will agree to such a deal. If so, then it would be worth getting something done. But as Coburn demonstrates, it's much more likely nothing will get done. As a result, the Bush tax cuts will expire and we'll have this debate again in 2013. But that won't be a disaster, politically or fiscally, and as long as Democrats are willing to let Republicans kill the Bush tax cuts, they'll have all the leverage they need to get a decent deal done.