With just two weeks to go before the election, and the lame-duck session just around the corner, a small group of Senators is working in earnest to avert sequestration, which will go into effect in January. For months, advocacy groups on all sides have warned lawmakers of the significant negative impact such blunt, across-the-board cuts would have. However, only now that the implementation date draws near have legislators begun to tackle the biggest challenges associated with averting sequestration: namely, if deficit reduction measures can be implemented and targeted savings achieved in a more palatable way than the current across-the-board cuts, and is a bipartisan agreement to do this even possible?
Accordingly, a so-called “Gang of Eight” has been meeting regularly to come up with options for Congress to consider this fall. This new Gang of Eight is made up of Senators Chambliss (R-GA), Coburn (R-OK), Crapo (R-ID), Johanns (R-NE), Conrad (D-ND), Durbin (D-IL), Bennet (D-CO), and Warner (D-VA). Leading discussions with the Senators are Erskine Bowles and Alan Simpson—the architects of last year’s Bowles-Simpson plan for deficit reduction; their goal is a bipartisan “grand bargain” for deficit reduction that would avert the sequester. One option under discussion, and recently outlined by the Bipartisan Policy Center, would be to require Congressional committees to identify savings on their own in order to bypass the sequester; Congress could do this by passing a reconciliation-type package with legislative instructions that each Congressional committee must reach specific savings targets for programs within their jurisdiction. Another option could be to postpone the sequester for a few months, aligning cuts with the expiring Continuing Resolution for FY2013 appropriations (end of March) or the deadline by which Congress must again raise the debt ceiling (roughly mid-February), thereby forcing the incoming 113th Congress to reach an agreement on all three issues together. Although House Speaker Boehner has not been involved in the most recent negotiations on deficit reductions (citing previously passed bills as the House’s official position), the House leadership will likely be involved in discussions after the election. The Speaker said on a recent conference call that Congress will need to act on the impending fiscal cliff – and that it will be a busy November and December. NACHC is monitoring the issue closely so stay tuned for updates as we move through the election and into the lame-duck session this fall.