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Deficit Panel Impasse Intensifies

Bill Clark/CQ Roll Call
After Democrats circulated a memo Wednesday dismissing a GOP plan, deficit panel member Sen. Jon Kyl said those on the left need to show some movement on their side.

“We are waiting for them to bring us back a fair and balanced proposal,” Murray said after the Democratic meeting. “They clearly understand that the proposal that was given to some of our Members is not fair and balanced, and they understand that they need to bring back a fair and balanced proposal.

“I believe that they understand the dynamics of where we are,” Murray continued.

Democrats circulated a memo Wednesday dismissing the GOP plan — which Toomey largely crafted — charging that lowering the top rate for individual income taxes to 28 percent would require “even more dramatic cuts” to the tax expenditure system than the hypothetical eliminations put forward. Because there are no detailed specifications for the Toomey plan, the document was based on previous scores to other proposals as well as projected cuts that might achieve similar savings.

Meanwhile, Republicans believed they came to the table with a serious offer. In a closed-door, full Senate GOP Conference meeting Wednesday afternoon, the super committee Republicans presented the plan to their colleagues. And though any proposal that touches taxes generally has been dismissed by Republicans, Senators leaving Wednesday’s session indicated the plan was received warmly.

And Members of both parties indicated that including revenues marks a shift in the GOP position — though how large a shift certainly depends on whether you’re viewing the plan from the right or left side of the aisle.

“It recognizes the seriousness of the problems we face and the eagerness of Republicans to get a result,” Senate Republican Conference Chairman Lamar Alexander (Tenn.) said. “If you think about it, Pat Toomey, Portman and [Sen. Jon] Kyl [R-Ariz.] come in and tell a whole roomful of Republicans that we’ve put $250 billion in tax increases on the table and not get a murmur of dissent is remarkable and a major step by Republicans.”

Sen. Lindsey Graham (R-S.C.) said he believed Republicans had crossed “an ideological bridge that I’m impressed with ... It’s a huge deal.”

But Democrats believe the ratio of cuts-to-revenues is still off and did not indicate Wednesday that they will make a counter-offer. It puts the panel in a tough spot. Even if Republicans on the super committee wanted to move further on taxes, they may be hampered by rank-and-file Republicans in the House and Senate.

Some Democrats, however, remained hopeful that Republicans could keep moving their way.

“The word ‘revenue.’ It is a breakthrough. I think you have to honest. There haven’t been many who stepped forward. ... This is the first time, at least publicly, that we know that it’s on the table,” Senate Majority Whip Dick Durbin (D-Ill.) told reporters Wednesday, before adding that he still believed that no deal would be better than a bad deal.

But Kyl said Democrats need to show some movement on their side. “They need to make the next move; they walked away from our proposal, and we think we have a reasonable offer,” he said.

Steven T. Dennis and Humberto Sanchez contributed to this report.

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