–Bowles And Simpson To Release Revised Plan Wed, Vote On Friday
–Bowles: ‘A Partial Solution Is Not Going To Help Us’
–Bowles: Revised Plan Will Be ‘Better, Stronger’
–Simpson: U.S. Has A ‘Serious Problem’
–Simpson: Deficit Panel Has ‘Done Our Level Past’

By John Shaw

WASHINGTON (MNI) – The co-chairmen of the National Commission on
Fiscal Responsibility and Reform, former senator Alan Simpson and former
White House chief of staff Erskine Bowles, said Tuesday that they will
release a revised deficit reduction plan Wednesday that calls for nearly
$4 trillion in budget savings over a decade.

At a briefing, Simpson and Bowles said they will release a revised
plan that attacks the nation’s serious deficit problems.

They said they will call on their 18 person panel to vote on the
plan Friday.

Both said they have no idea if it will secure the 14 votes that are
required to bring it to the floor of the House and Senate for its
consideration.

“America, you have a serious problem,” Simpson said of the nation’s
deficit predicament.

“We have worked hard … . We have done our level best,” he said.

“The problem is real, the solutions are painful, there are no easy
choices,” Bowles said.

“This is the moment of truth,” Bowles said.

Bowles said he hopes his panel has focused the attention of the
American people on the nation’s dire fiscal problem.

“The era of deficit denial in Washington is over,” he said.

Bowles said they have decided not to offer a milder plan to attract
more support.

“A partial solution is not going to help us,” Bowles said, adding
the new plan will be “better, stronger.”

Their initial draft would bring the federal budget deficit down to
2.2% of gross domestic product by 2015. It would reduce the nation’s
debt to 60% of GDP by 2024 and to 40% of GDP by 2037.

But to achieve these fiscal goals it would force sweeping, even
fundamental, changes to the federal budget — changes far beyond what
any Congress or administration has even contemplated, let alone
accepted.

The plan would wring deep savings out of every corner of the
federal budget, including defense and Social Security.

The Bowles-Simpson plan would put in place tough discretionary
spending caps that would help achieve about $1.4 trillion in savings. It
calls for $733 billion in entitlement savings and $751 billion in
savings from overhauling tax expenditures over a decade.

The plan calls for fiscal changes that would bring federal spending
down to about 21% of GDP and boost revenues to bring them up to 21% of
GDP. The plan would balance the federal budget by 2037.

President Obama created the commission on Feb. 18 by executive
order after an attempt by lawmakers to create a panel by statute failed
in the Senate.

The commission is charged to issue a report by Dec. 1 that would
cut the deficit to about 3% of gross domestic product by fiscal year
2015 and begin slowing the growth of debt over the long term.

In order for the panel to issue recommendations, 14 of the 18
members need to reach an agreement.

The commission includes the chairmen and ranking members of the
Senate and House Budget committees, the chairman of the Senate Finance
Committee, and a former White House budget director and vice chairman of
the Federal Reserve Board.

It also includes some of the fiercest partisans of recent budget
battles, including five congressional Republicans who appear to believe
that tax increases should be off the table for fixing the U.S.’s fiscal
challenges and several Democrats who say that all key social programs
should be kept off limits.

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

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