Democrats propose new $110 plan for new taxes, spending cuts,
WASHINGTON — Senate Democrats on Thursday proposed a $110 billion plan to cut projected budget deficits and replace automatic spending cuts scheduled to take effect March 1.
The plan calls for a combination of tax increases and cuts in projected spending — echoing President Obama's demand that any alternative includes tax increases.
Senate Democrats hope to vote on their package the week of Feb. 25. Their proposal would allow the government to avoid the $85 billion in across-the-board fiscal 2013 cuts, known as the sequester. Instead, it would replace 10 months of sequestration with new taxes and different spending reductions spread out over 10 years.
The plan includes $55 billion in new tax revenue from a minimum 30 percent tax on most millionaires and ending some oil-industry tax breaks and a benefit that encourages companies to ship jobs overseas. About $55 billion would be saved by cutting $27.5 billion from Defense — exactly what is not specific — and saving $27.5 billion by ending direct payments to farmers. All savings are calculated over a 10-year period.
The White House praised the plan.
“Senate Democrats offered a balanced plan to avoid across-the-board budget cuts that will hurt kids, seniors, and our men and women in uniform. The plan includes spending cuts that won't harm middle-class families while closing tax loopholes that benefit the wealthiest,” said press secretary Jay Carney.
The package, however, faces at least two huge obstacles.
The legislation would need 60 votes to clear procedural hurdles in the Senate. Democrats control 55 seats, and Republicans have made it clear they're in no mood for more taxes.
Even if the proposal were approved, it still would need to be passed by the Republican-led House, which barely would have time to consider or change the measure.
Senate Budget Committee Chairman Patty Murray, D-Wash., insisted that once lawmakers hear from constituents, and the impact of the sequester becomes clearer, Republicans will soften their position.
“We have a week and a half to get public support with us,” she said.
Republicans, though, don't agree with Murray.
“This is not a solution. Even they know it can't pass — that's the idea,” said Senate Republican leader Mitch McConnell of Kentucky. “It's a political stunt designed to mask the fact that they've offered no solutions and don't plan to offer any. And it's a total waste of time.”