–Rep. Hensarling: ‘Convinced’ Panel Will ‘Seize’ Historic Challenge
–Rep. Hensarling: ‘We Know It Will Not Be Fun’
–Sen. Murray: Panel ‘Ready To Get To Work'; Will Release Sked Soon
–Sen. Baucus: ‘Very Encouraged’ By Tone of Private Meeting

By John Shaw

WASHINGTON (MNI) – The co-chairmen of Congress’s Select Committee
on Deficit Reduction emerged Thursday from a private breakfast meeting
with their colleagues on the panel saying they are determined to work
toward an agreement.

In comments to reporters, Republican congressman Jeb Hensarling and
Democratic Senator Patty Murray said the panel is ready to move into
action.

Hensarling said he is “convinced” the panel is facing a historic
challenge to assemble a major deficit reduction package, adding that
this opportunity “can be seized, must be seized.”

“We know it will not be fun. We know it will not be easy. We know
it will not be popular,” Hensarling said.

“We stand ready to get to work,” Murray said, adding the panel may
release its hearing schedule as early as today.

Senate Finance Committee Chairman Max Baucus, a member of the new
panel, said he was “very encouraged” by the private breakfast the
deficit panel held Thursday.

“It exceeded my expectations. I’m very encouraged,” he said.

The Deficit Reduction Committee has held two public meetings so
far: an organizational meeting last week and a session Tuesday with
Congressional Budget Office Director Doug Elmendorf.

In the first two sessions it has become clear that the panel is
divided on whether the focus of deficit reduction efforts should be on
spending cuts or a package that includes both spending cuts and
additional revenues. Republicans prefer the former, Democrats the
latter.

The committee also appears divided on the scope of its ambitions,
with some members urging the panel to secure about $4 trillion in budget
savings while others want it to focus on the panel’s statutory goal of
finding $1.5 trillion in savings.

Former Federal Reserve Board Chairman Alan Greenspan told a
congressional panel Tuesday that Congress’s new deficit reduction panel
should secure $4 trillion in budget savings over a decade “at a
minimum.”

But other lawmakers argue that given the limited time that the
panel has to work, it should focus on its mandated goal of $1.5 trillion
in savings.

Senate Minority Whip Jon Kyl has urged the panel to embrace its
goal of $1.5 trillion in savings. “We have a lot of work to do in a very
short period of time, and it’s tedious work,” Kyl said Tuesday during
the panel’s second meeting.

“It will take us a lot of time to complete. And I have expressed a
little bit of frustration that we need to get moving and that job will
be harder than some people realize,” Kyl said.

Kyl has said that he doubts the deficit panel has the time or the
ability to craft fundamental reforms of entitlement programs or the tax
code, but should focus on incremental steps.

During the panel’s Tuesday’s hearing with Congressional Budget
Office Director Doug Elmendorf, Kyl said he wants to focus on
eliminating inefficiencies and waste from Medicaid and Medicare rather
than trying to alter the structure of these programs.

Elmendorf said there is “no evidence” the savings that could be
achieved in these areas would produce savings that would even make
substantial inroads into achieving $1.5 trillion in savings.

The Joint Select Committee on Deficit Reduction is charged to
submit a report to Congress by Nov. 23, 2011 that reduces the deficit by
$1.5 trillion between 2012 and 2021.

The final package, if one is agreed to by the majority of the
panel’s 12 members, must be voted on without amendment by the House and
Senate by Dec. 23, 2011.

If the panel fails to agree on a spending cut package or Congress
rejects its plan, a budget enforcement trigger would secure $1.2
trillion in budget savings through across-the-board cuts.

The cuts would be equally divided between defense and non-defense
programs but would exempt Social Security, Medicaid and low-income
programs.

** Market News International Washington Bureau: (202) 371-2121 **

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