News / USA

Hopes Fade for US Deficit Reduction Deal

The U.S. Capitol building in Washington, Nov., 19, 2011.
The U.S. Capitol building in Washington, Nov., 19, 2011.

Last-ditch hopes for a bipartisan deal to improve U.S. government finances are waning, days before a deadline for a special congressional committee to recommend ways to achieve $1.2 trillion in deficit reduction over 10 years.  Although the so-called “supercommittee” technically has until Wednesday to act, a firm proposal is needed by late Monday so lawmakers and budget analysts can review the plan.

With hours remaining until Monday’s interim deadline, no one on the 12-member supercommittee says a deal is imminent. The Republican co-chairman, Congressman Jeb Hensarling of Texas, spoke on the U.S. television program Fox News Sunday.

"Nobody wants to give up hope. Reality is, to a certain extent, starting to overtake hope. It is a daunting challenge, no doubt about it," he said.

A Democratic supercommittee member, Representative Xavier Becerra of California, compared the situation to the final minutes of a sporting match.

"We are deep into the fourth quarter, but there is still time on the clock. I do not think any of us wants to let the time run out," he said.

Days ago, many lawmakers of both parties urged the supercommittee to bridge ideological gulfs and arrive at a compromise that cuts the deficit by more than the minimum $1.2 trillion specified in a budget deal signed into law earlier this year.  Recent weeks have seen some Republicans soften their opposition to new tax revenue, while many Democrats, including President Barack Obama, have long said they would be willing to restructure costly programs that provide income and health care for retirees.

But the ratio of spending cuts to tax hikes, and the specific composition of both, present a seemingly insurmountable stumbling block.

Representative Hensarling says Democrats continue to oppose meaningful spending restraint.

"We all know, and even the president will admit, that the great drivers of our debt are Medicare, Medicaid and health care. Nothing else comes close. But unfortunately what we have not seen in these talks is any Democrat willing to put a proposal on the table that actually solves the problem," he said.

Democrats counter that it is Republican insistence on preserving tax cuts for the rich that is the major sticking point. Once again, Congressman Becerra, who also appeared on Fox.

"Every plan that Democrats have put forward has included cuts to entitlement programs. But it has got to be balanced," he said. "You cannot say you are going to take benefits away from Social Security and Medicare, and not ask our wealthiest Americans [to pay more taxes] - why should they escape participation when we are asking seniors to help cover the costs of deficits?"

Failure by the supercommittee would trigger automatic spending cuts to domestic programs and national defense. In addition, a wide range of tax cuts enacted since 2001 will expire unless extended by Congress.

Economist Mark Zandi of Moodys Analytics, a financial ratings firm, says he does not foresee an immediate market panic if the supercommittee fails.

"I do not think there will be much of a reaction. It is all relative to expectations, and investor expectations with regard to the [super]committee have been and still are very, very low," he said.

But Zandi adds that a long-term failure by the United States to confront its debt problem would harm the economy and shatter investor confidence.  The U.S. federal deficit exceeds $1 trillion, contributing to a national debt of about $15 trillion.

You May Like

Turkey's Erdogan: Women Not Equal to Men

Speaking at conference in Istanbul, President Erdogan says Islam has defined a position for women: motherhood More

Ahead of SAARC Summit, Subdued Expectations

Some regional analysts say distrust between Pakistani, Indian officials has slowed SAARC's progress over the year More

Philippines Leery of Development on Reef Reclamation in S. China Sea

Chinese land reclamation projects in area have been ongoing for years, but new satellite imagery reportedly shows China’s massive construction project More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Changei
X
November 24, 2014 10:09 PM
Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Change

Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Mali Attempts to Shut Down Ebola Transmission Chain

Senegal and Nigeria were able to stop small Ebola outbreaks by closely monitoring those who had contact with the sick person and quickly isolating anyone with symptoms. Mali is now scrambling to do the same. VOA’s Anne Look reports from Mali on what the country is doing to shut down the chain of transmission.
Video

Video Ukraine Marks Anniversary of Deadly 1930s Famine

During a commemoration for millions who died of starvation in Ukraine in the early 1930s, President Petro Poroshenko lashed out at Soviet-era totalitarianism for causing the deaths and accused today’s Russian-backed rebels in the east of using similar tactics. VOA’s Daniel Shearf reports from Kyiv.
Video

Video Hong Kong Protests at a Crossroads

New public opinion polls in Hong Kong indicate declining support for pro-democracy demonstrations after weeks of street protests. VOA’s Bill Ide in Guangzhou and Pros Laput in Hong Kong spoke with protesters and observers about whether demonstrators have been too aggressive in pushing for change.
Video

Video US Immigration Relief Imminent for Mixed-Status Families

Tens of thousands of undocumented immigrants in the Washington, D.C., area may benefit from a controversial presidential order announced this week. It's not a path to citizenship, as some activists hoped. But it will allow more immigrants who arrived as children or who have citizen children, to avoid deportation and work legally. VOA's Victoria Macchi talks with one young man who benefited from an earlier presidential order, and whose parents may now benefit after years of living in fear.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.

All About America

AppleAndroid