Deficit hawks urge deep cuts by supercommittee (AP)

WASHINGTON ? Four prominent deficit-cutters told Congress' bipartisan supercommittee on Tuesday that they should raise revenues and make major changes to expensive health programs on their way to a debt-reduction compromise that should exceed their $1.2 trillion, 10-year mandate.

But in an indication of the partisan divisions that have stalled the evenly divided panel, lawmakers on the committee spent much of their time touting their own plans for mopping up red ink and sparking the economy.

If the two parties prove unwilling to make concessions ? like Republicans accepting higher revenues and Democrats backing significant overhauls to programs like Medicare ? then "they are both complicit in letting America destroy itself," testified Pete Domenici, a former GOP senator from New Mexico who headed the Senate Budget Committee.

"I think it would be devastating," Alice Rivlin, a White House budget director under President Bill Clinton, said of the outcome should the panel fail. "We could face a long period of stagnant growth, another recession that would be worse than the one we're slowly climbing out of."

Erskine Bowles, a White House chief of staff under Clinton, said the public would reward the lawmakers "if you're bold and do it in a smart manner" ? a euphemism for going well beyond their goal of finding at least $1.2 trillion in savings.

But he sounded a note of pessimism: "I have great respect for each of you individually. But collectively, I'm worried you're going to fail."

All four budget experts urged the panel to go trillions beyond its savings target.

The testimony came with the supercommittee so far showing little sign of progressing toward a bipartisan deal. The panel has until Nov. 23 ? three weeks away ? to recommend proposals for savings. If it fails or if Congress does not enact a package by Dec. 23, $1.2 trillion in automatic cuts to defense and many domestic programs would begin in 2013.

Reinforcing the sense that the panel has been stumbling, many remarks by supercommittee members were aimed at their own favorite proposals.

Rep. James Clyburn, D-S.C., asked about the impact on poor people of deep spending cuts while House Ways and Means Committee Chairman Dave Camp, R-Mich., asked about curbing taxes on profits U.S. companies earn abroad. Murray asked about a "balanced approach" to deficit reduction that relies on revenues and benefit program savings. Sen. Pat Toomey, R-Pa., inquired about the merits of raising revenue by spurring economic activity.

With Democrats insisting on tax increases as their price for accepting savings from Medicare and other major benefit programs, conservative anti-tax activist Grover Norquist came under fire from two quarters. Norquist has long circulated a pledge against raising taxes that scores of Republicans have signed.

Republicans, "these poor folks, are being led like puppets by Grover Norquist," Senate Majority Leader Harry Reid, D-Nev., told reporters.

And at the supercommittee hearing, former Sen. Alan Simpson, R-Wyo., told the panel that Norquist "should run for president, there's no question about his power."

Sen. Patty Murray of Washington, top Democrat on the supercommittee, said the panel is entering "the final critical phase" of its work. But she warned that both sides have to compromise ? a clear shot at Republicans who so far have been unwilling to accept higher taxes as part of a deal.

"Everyone needs to be putting some real skin in the game and offering serious compromises," Murray said.

Rep. Jeb Hensarling of Texas, the supercommittee's No. 1 Republican, said expensive health programs like Medicare are the top budget problem and said "tinkering around the edges" with those programs would achieve little.

Asked afterward about evidence that Republicans are willing to compromise on taxes, Hensarling said, "Republicans want to raise revenue, we want to raise it through pro-growth policies."

Democrats want to raise revenue by making tax code changes that directly raise more money for the government.

Domenici and Rivlin produced a bipartisan deficit-cutting plan last year producing trillions in budget savings. Bowles and Simpson wrote a similar package. Both blueprints relied heavily on revenue increases and on savings from benefit programs.

Source: http://us.rd.yahoo.com/dailynews/rss/us/*http%3A//news.yahoo.com/s/ap/20111101/ap_on_go_co/us_supercommittee_debt

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