News / USA

Failure Likely Imminent for US Deficit Panel

Members of the U.S. Joint Select Committee on Deficit Reduction attend a hearing on Capitol Hill (File)
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Cindy Saine

With only hours to go before an interim deadline, a special congressional committee appears set to announce its failure to reach agreement on ways to cut the U.S. deficit by $1.2 trillion over the next 10 years.

Republican and Democratic lawmakers already have begun to blame each other for the likely failure of the "supercommittee" to reach a deal.

The U.S. Capitol was largely quiet Monday, with most lawmakers already back in their home districts for the coming Thanksgiving holiday. But a handful of supercommittee members worked in a last-ditch effort to reach an agreement to cut the deficit. Democrat Senator John Kerry said there is still hope, but that there has to be real compromise.

"It is the insistence on extending the Bush tax cuts for the wealthy, which the vast majority of Americans do not think we should do," he told Bloomberg news, blaming Republicans for the supercommittee's failure so far.

What Happens if the supercommittee fails?


    - $1.2 billion in cuts split equally between defense and non-defense spending are triggered.

    - Estimated at $55 billion in each type of spending per year from 2013 through 2021.

    - Social Security, Medicare, and other programs exempt from cuts.

    - U.S. Defense Secretary Leon Panetta warns cuts could leave U.S. military with its smallest ground force since 1940s.

    -The automatic spending reductions are known as "sequestration."

Ideological differences have kept Republicans and Democrats from agreeing on how to rein in the country's budget deficits for much of the past year. Democrats refuse to accept big cuts to the social welfare programs for the poor and the elderly, and Republicans refuse the tax increases for the wealthiest Americans that Democrats are pushing.

Republican Senator Jeff Sessions, who is not a member of the supercommittee, told Bloomberg he had never held high hopes for the panel, which largely met in secret, to tackle the crucial issue of the country's debt.

"I think what Congress should do is fulfill its responsibility, to publicly, openly debate these serious issues, the most incredible issue of our time," said Sessions.

The committee was created in August when the White House, the Senate and the House of Representatives were unable to resolve a dispute on raising the U.S. debt ceiling. The government came within hours of being unable to pay its debts and the country's credit rating was downgraded for the first time in history.

President Barack Obama has not been involved in the supercommittee's efforts but has called on the panel to make tough choices and "do its job." In a written statement Monday, Republican House Speaker John Boehner blamed President Obama and Democrats for insisting on tax hikes on what Boehner called America's "job creators."

With the likely collapse of the U.S. debt talks and continuing concerns about the European debt crisis, world stock markets fell Monday. When Congress returns after its recess, there is likely to be more of each side blaming the other. Political analysts say it may be up to American voters to decide next year whether they want to focus on tax increases or cuts to social programs to reduce the deficit.

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