What John Boehner Wants From the Deficit Supercommittee

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Back in May, when Democrats and Republicans in Congress were in the early stages of jockeying for position in the impending debt debacle, John Boehner went to the Economic Club of New York to deliver an ultimatum. The federal debt ceiling wouldn’t be raised, he said, unless the spending cuts in the deal exceeded the size of the hike. “That is not going to happen,” I wrote, in a post that likened the House Speaker’s position – a politician explaining his party’s antics to business titans who just want Washington to behave — to “a kid summoned to the principal’s office.” I was wrong, at least so far. Boehner struck a deal that included dollar-for-dollar cuts in its first phase, and established a deficit-reduction “supercommittee” to find the remaining $1.5 trillion, with a trigger that inflicts painful penalties on both parties if they fail to comply.

Four months later, Boehner went to the Economic Club of Washington on Thursday to dictate the terms of the negotiations once again. “When it comes to producing savings to reach its $1.5 trillion deficit reduction target, the Joint Select Committee has only one option: spending cuts and entitlement reform,” Boehner told the audience, which gave him a standing ovation after a speech that urged lawmakers to “liberate our economy from the shackles government has placed on it.”

Boehner also urged the supercommittee to overhaul the U.S. tax code by lowering individual and corporate rates and closing loopholes. But completing this tricky task by the Thanksgiving deadline probably isn’t a feasible goal, he said. “It’s probably not realistic to think the Joint Committee could rewrite the tax code by November 23. But it can certainly lay the groundwork by then for tax reform in the future that will enhance the environment for economic growth,” Boehner explained. “The Committee can develop principles for broad-based tax reform that will lower rates for individuals and corporations while closing deductions, credits, and special carve-outs in our tax code. And I hope it will.”

Once again, he took tax increases off the table. “They destroy jobs. And the Joint Committee is a jobs committee,” he said. He said he would regard the expiration of the Bush tax cuts as a tax increase, removing another option at lawmakers’ disposal. And he repeated the familiar Republican mantra that deficit reduction will create jobs by dispelling long-term economic uncertainty, part of what he called the “triple threat” chilling job creation: meddlesome regulations, Washington’s “spending binges,” and an inequitable tax code.

Recognizing that the public are weary of partisan bickering, House Republicans have been careful of late to cloak their combativeness in calls for unity, and Boehner’s speech contained the requisite calls for bipartisanship. “If we want to create a better environment for job creation, politicians of all stripes can leave the ‘my way or the highway’ philosophy behind,” Boehner said. But amid pleas for the two parties to disagree agreeably, House Speaker took plenty of shots at President Obama, arguing that the initiatives in his jobs plan “seemed to have more to do with the next election than the next generation.”

He also criticized Obama for proposing to stimulate the economy by grafting new tax breaks onto an already complex system. “It strikes me as odd that at a time when it’s clear that the tax code needs to be fundamentally reformed, the first instinct out of Washington is to come up with a host of new tax credits that make the tax code more complex,” Boehner said.

The speech doesn’t make things easier for the six Democrats on the supercommittee, which held a closed-door breakfast meeting on Thursday morning after two public hearings that included no meaningful debate on how the group can accomplish their task. Both parties say they may be able to find common ground on tax reform, and supercommittee members from both sides — as well as many of their colleagues — have said they hope to achieve far more than $1.5 trillion in savings, which would likely entail a tax-code overhaul. Boehner is likely right that it’s unrealistic to expect that messy process to wrap up within two months. But by limiting the supercommittee’s role in that process to laying “the groundwork” — and by ruling out tax increases — he has effectively demanded that the savings come from the two areas Republicans have wanted all along: reductions in federal spending, and reforms to programs like Medicare and Social Security.

Democrats aren’t opposed to making changes that “strengthen” such programs, says a House Democratic aide. And President Obama is expected to call next week for tweaks that would save hundreds of billions of dollars from Medicare and Medicaid over the next decade, a move that could inflame liberal lawmakers and increase the odds that the supercommittee will look to such programs to meet their benchmark. Just as Boehner wants it. Having survived the crucible of the debt crisis, he is laying down his marker once again, and this time there’s little indication that things won’t go his way.