The Senate’s No. 2 Democrat called the GOP’s willingness to consider new tax revenues to help lower the nation’s debt a “breakthrough” and encouraged his party to reciprocate by putting entitlement reforms and spending cuts on the table.
Republicans on the debt-reduction supercommittee Monday offered limits on popular tax breaks, such as the mortgage-interest deduction, in exchange for significantly lower income-tax rates. Democrats then countered with an equal blend of spending cuts and tax revenue over the next decade, details of which were reported late Wednesday.
The two parties still aren’t close to reaching a debt-reduction agreement before a Thanksgiving deadline. But Senate Majority Whip Richard J. Durbin’s comments, along with the competing partisan deals that offer fresh concessions, suggest a possible thaw in the ongoing negotiations to lower the nation’s $14.9 trillion debt.
“I assume that what we heard from Republicans is a breakthrough that can lead to an agreement, and that’s what we need,” the Illinois Democrat told reporters at the Capitol on Wednesday.
The GOP plan initially was dismissed within Democratic circles on Capitol Hill. But Mr. Durbin said that while he wasn’t endorsing the Republicans’ latest offer, he characterized it as an “honest effort” and suggested his party should respond with concessions of its own.
“The fact that some Republicans have stepped forward to talk about revenue, I think, is an invitation for Democrats to step forward and talk about entitlement reform as well as spending cuts,” he said. “Therein lies the core of an agreement.”
The Democratic offer includes $1 trillion in spending cuts and $1 trillion in higher tax revenue over the next decade, congressional aides said. The deal is a scaled-back version of a plan Democrats floated last month that called for $1.3 trillion in tax increases.
The Democrats’ latest proposal also jettisoned a plan to slow the growth in future cost-of-living increases in Social Security benefits, a provision liberal Democrats oppose.
The new offer generated a lukewarm response among some GOP officials.
“Right now, we are waiting for a response to what the second-ranking Democratic leader in the Senate called ’a breakthrough’ - and we’ve seen nothing,” said Michael Steel, a spokesman for House Speaker John A. Boehner, Ohio Republican.
The Republican debt-reduction plan - which, like the Democratic offer, wasn’t made publicly available - calls for a net increase in individual income-tax revenues of about $300 billion over the coming decade.
The GOP plan would cut the top tax rate from 35 percent to 28 percent, Democratic aides said, which they complained would allow wealthier earners to receive large tax cuts while middle-class workers would lose out on deductions for mortgage interest and state and local taxes.
Meanwhile, a bipartisan group of 45 senators, an outgrowth of the “Gang of Six”-debt reduction group, met this week to consider drafting a letter to encourage the supercommittee to “go big” and find budget savings of $4 trillion - between two and three times its goal.
The 12-member bipartisan supercommittee is tasked by Nov. 23 to find ways to lower the debt by $1.5 trillion. Failure would trigger $1.2 trillion in automatic spending cuts, with about half directed at the Pentagon.
This article was based in part on wire service reports.
• Sean Lengell can be reached at slengell@washingtontimes.com.
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