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I have this optimistic fantasy — that the chairmen of Congress’ fiscal super committee, Sen. Patty Murray (D-Wash.) and Rep. Jeb Hensarling (R-Texas), will get together for a “two-pitcher lunch” and agree to “go big” on debt reduction.
The original two-pitcher lunch occurred April 18, 1986, rescuing bipartisan tax reform from what looked like certain death and propelling it to overwhelming Congressional passage and dramatic benefits to the economy.
Right now, unless something equally stunning happens, the Joint Committee on Deficit Reduction will deadlock this month, possibly triggering huge cuts in domestic and defense spending in 2013 but also guaranteeing continued national economic and political malaise.
What could turn the economy around — and restore a measure of respect for Congress — would be an agreement that substantially reduced the nation’s long-term debt burden.
It would take a bold step from Murray and Hensarling — like a $4 trillion proposal — to break through partisan wrangling over how to get to $1.2 trillion or $1.5 trillion in cuts over 10 years.
Granted, in 1986 the two-pitcher lunch wasn’t bipartisan. It was Sen. Bob Packwood (R-Ore.), chairman of the Senate Finance Committee, eating cheeseburgers and drinking beer with his top aide, Bill Diefenderfer.
But the outcome — Packwood’s decision to stop protecting special interests and “go radical” on tax reform — galvanized a bipartisan response and resulted in near-unanimous Senate approval of a measure to close loopholes and lower tax rates.
As recounted in “Showdown at Gucci Gulch” by Jeffrey Birnbaum and Alan Murray, the definitive account of the ’86 tax fight, immediately before the lunch, the Finance Committee had essentially killed reform, wrangling over how to keep each Senator’s favorite loopholes.
Packwood’s epiphany electrified the committee and Senate and led to reforms that — when signed into law by President Ronald Reagan — lowered the top individual tax rate from 50 percent to 28 percent and the corporate rate from 48 percent to 34 percent, stimulating economic output and increasing government revenues.
Earlier, in late 1985, tax reform also almost died in the House when Republicans defeated a Democratic bill.
It was saved when GOP Conference Chairman (and reform champion) Jack Kemp (N.Y.) broke ranks to vote for the bill and then persuaded Reagan to talk GOP Members into changing their votes to push the issue along to the Senate.
Tax reform was a great idea in the 1980s, but fiscal reform today is vital to the nation’s well-being. Otherwise, the national debt will devour the economy.
“Going big” has the backing of 100 House Members and 44 Senators of both parties, plus a host of deficit hawk groups such as the Committee for a Responsible Federal Budget.
And there’s a recent example where “going big” instead of wrangling over the small led to major results — President Barack Obama’s 2010 debt commission, a majority of whose members agreed on measures, including tax reform, to lower the nation’s debt by $4 trillion.
When the commission’s co-chairmen testified before the super committee last week, they said that instead of scaling down their plans to win majority support, “the tougher we made our proposal, the more people came aboard.”