While the Republicans were passing cut, cap and balance, other Republicans were working behind closed doors against them on a bipartisan plan to reduce the deficit, a plan which includes a lot of new taxes. President Obama endorses the plan, enthusiastically I might add.
This nonsense of offering cuts in the “out years” needs to be looked at it for what it is – imaginary. It will never happen. It’s the epitome of kicking the can.
From Reuters: Senate Budget Committee Chairman Kent Conrad, one of the six Democratic and Republican senators who have been working since December on a deficit-reduction plan, said the proposed $3.75 trillion in savings over 10 years contains $1.2 trillion in new revenues.
One theory proposed by Beltway Confidential about this secretive new plan: The Gang of Six “Bipartisan Plan to Reduce Our Nation’s Deficits” claims their tax reforms would be scored by the Congressional Budget Office as a $1.5 trillion net cut. But no details are provided on how they arrive at this number other than saying they will abolish the Alternative Minimum tax. So how can this plan claim to be a “balanced approach” (which means higher revenues), yet also claim to be a $1.5 trillion tax cut?
This probably means they are using a CBO baseline that assumes the AMT continues as written today and that the current Bush rates expire. Last August, the CBO said those policies would amount to a $4.8 trillion tax hike. Which means the the Gang of Six plan probably raises taxes by about $3+ trillion over current rates. Read here: 3t in taxes