Big economic tweak gets bipartisan support

“Fresh spending and tax cuts may worsen deficits in the short term, but they could serve to shrink them in the long run by boosting economic growth, increasing business profits and swelling personal paychecks - all of which increases the flow of tax revenue to federal coffers.”

“Rival lawmakers join to rally for deficit plan

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Erskine Bowles Says Era of Deficit Denial Is Over

Dec. 1 (Bloomberg) -- Erskine Bowles, a former chief of staff to President Bill Clinton, and Alan Simpson, a former Republican senator from Wyoming, talk about the outlook for President Barack Obama's debt-reduction commission. Bowles and Simpson talk with Peter Cook on Bloomberg Television's "Street Smart." (Source: Bloomberg)

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By Lori Montgomery and Shailagh Murray

Washington Post Staff Writer 
Saturday, December 4, 2010; 12:00 AM

An unexpected groundswell of support was building Friday around an aggressive blueprint for cutting long-term spending, raising taxes and stabilizing the growing national debt, as lawmakers in both parties called on President Obama to embrace the proposal and launch a serious effort to rebalance the federal budget.

Eleven of the 18 members on Obama's fiscal commission voted to endorse the package, short of the 14 needed to force quick action in Congress. But three Republican and three Democratic lawmakers were among those voting "yes," a show of bipartisan support that Senate Majority Whip Richard J. Durbin (D-Ill.), a commission member, hailed as a "breakthrough."

The reality of deficit reduction remains more complicated, however, particularly against a backdrop of stubbornly high unemployment and strident calls for short-term spending to boost the economy. The Bureau of Labor Statistics released a surprisingly weak jobs report Friday showing that the unemployment rate jumped to 9.8 percent in November. Emergency jobless benefits expired this week, and the price for keeping them flowing through next year, as Democrats favor, is $56 billion.

Meanwhile, tax cuts enacted 10 years ago during record surpluses are set to expire on New Year's Eve, and the two political parties are waging a bitter battle to extend some or all of them - adding trillions of dollars to future deficits. Even as they applaud the commission's work, lawmakers have so far demonstrated little appetite for the painful job of raising people's taxes and cutting their federal perks.

Many economists, including Federal Reserve Chairman Ben S. Bernanke, argue that this would be the wrong time to pursue austerity measures, anyway. Fresh spending and tax cuts may worsen deficits in the short term, but they could serve to shrink them in the long run by boosting economic growth, increasing business profits and swelling personal paychecks - all of which increases the flow of tax revenue to federal coffers.”