In a letter to President Obama, House GOP leaders are urging the president to consider a fiscal plan proposed last year by Erskine Bowles, Bill Clinton's former chief of staff and the co-chair of Obama's deficit commission.
The plan proposed by Bowles last year includes $1.1 trillion in spending cuts and $800 billion in new tax revenue. "Notably, the new revenue in the Bowles plan would not be achieved through higher tax rates, which we continue to oppose and will not agree to in order to protect small businesses and our economy," the GOP leaders write. "Instead, new revenue would be generated through pro-growth tax reform that closes special-interest loopholes and deductions while lowering rates. On the spending side, the Bowles recommendation would cut more than $900 billion in mandatory spending and another $300 billion in discretionary spending. These cuts would be over and above the spending reductions enacted in the Budget Control Act."
The Republican leaders point to the Bowles plan as a genuine compromise between Obama's proposal to raise taxes $1.6 trillion and the House-passed budget, which included revenue-neutral tax reform and major reforms to Medicaid and Medicare. "Indeed, the Bowles plan is exactly the kind of imperfect, but fair middle ground that allows us to avert the fiscal cliff without hurting our economy and destroying jobs," the Republicans leaders write. "We believe it warrants immediate consideration."
The letter is signed by Speaker John Boehner, Eric Cantor, Kevin McCarthy, Cathy McMorris Rodgers, Paul Ryan, Dave Camp, and Fred Upton.You can read it in full here:
December 3, 2012
The White House
1600 Pennsylvania Avenue, Northwest
Washington, DC 20500
Dear Mr. President,
After a status quo election in which both you and the Republican majority in the House were re-elected, the American people rightly expect both parties to come together on a fair middle ground and address the nation’s most pressing challenges.
To that end, shortly after the election, we presented you with a balanced framework for averting the fiscal cliff by coupling spending cuts and reforms with new tax revenue. We then welcomed Secretary Geithner to the Capitol on November 29 with every expectation that he would lay out a similarly reasonable path.
Regrettably, the proposal he outlined on behalf of your Administration contains very little in the way of common ground. The proposal calls for $1.6 trillion in new tax revenue, twice the amount you supported during the campaign. The proposal also includes four times as much tax revenue as spending cuts, in stark contrast to the “balanced approach” on which you campaigned. While administration officials are claiming that this proposal contains 2.5 dollars of spending cuts for each dollar in new revenue, counting as part of this ratio previously enacted savings – as if these were new spending reductions – only confuses the public debate. What’s worse, the modest spending cuts in this offer are cancelled out by the additional ‘stimulus’ measures the Administration is requesting. And, this proposal would remove any and all limits on federal borrowing.
We cannot in good conscience agree to this approach, which is neither balanced nor realistic. If we were to take your Administration’s proposal at face value, then we would counter with the House-passed Budget Resolution. It assumes an overhaul of our tax code with revenue remaining at historically normal levels and proposes structural reforms to preserve and protect the Nation's entitlement programs, ensuring they are sustainable for the long-term rather than continuing to grow out of control. Some of its key reforms include: