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Debt Deal May Not Have to Be All Cuts

Senate Democrats Want to Add Stimulus

Bill Clark/Roll Call
At a press conference Wednesday, Senate Democratic leaders, including Majority Leader Harry Reid (far right), argued that any deal to raise the debt limit and reduce the deficit should include provisions intended to stimulate job growth.

Suddenly, the debt limit negotiations aren't just about distributing painful cuts. They're also about including sweeteners that could make it somewhat easier for Members to stomach the political risks of such a plan.

In fact, Senate Democratic leaders Wednesday demanded new job-creating stimulus measures to be included alongside any spending cuts or entitlement reforms in bipartisan debt negotiations led by Vice President Joseph Biden.

After a disappointing May jobs report, Democrats sensed an opening to put Republicans on the defensive rather than simply play on the GOP's preferred turf of spending cuts.

Democrats aren't proposing a specific package but are instead floating various ideas they hope might get bipartisan support, including another payroll tax cut, infrastructure spending, job training programs, research and development and clean energy incentives.

"This is a stimulus program," said Sen. Charles Schumer (N.Y.), the No. 3 Democratic leader, adding that a package would be paid for in the long run as part of the larger deficit reduction effort.

"Let's say it costs $50 billion or
$100 billion, we're going to have to make that up to keep with the president's goal of $4 trillion in deficit reduction over 10 years," Schumer acknowledged.

He said the payroll tax cut in particular would be hard for Republicans to oppose, even though a number of them have said they don't like the idea.

"It's hard to figure out why Republicans would say 'no' for three reasons: It's pro-business, it's a tax cut and ... many of them have supported it in the past. ... You ask yourself, 'Are they against all job creation?'" he said.

Schumer said the U.S. Chamber of Commerce and other business groups across the country would get behind the idea, and the White House likes it.

"We're talking about policies that should be able to pass the Senate because they've received support from Democrats and Republicans in the past," Senate Majority Leader Harry Reid (D-Nev.) said.

But Republicans aren't particularly enthusiastic about trying to lessen the pain of any deficit reduction plan.

Sen. Dan Coats said the credibility of stimulus programs is shot.

"I think the Democrats have pretty much run out of stimulus options. ... I think the focus ought to go back to what this is all about, and that is [the] government overspends and overtaxes," the Indiana Republican said.

House Republicans accused Democrats of "reopening the failed stimulus playbook."

And a Senate GOP leadership aide questioned the seriousness of Schumer's pitch.

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