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Senate Dems likely to offer sequester deal

Feb. 8, 2013 - 01:15PM   |   Last Updated: Feb. 8, 2013 - 01:15PM  |  
Senate Armed Services Committee Chairman Carl Levin, D-Mich., said members of his party will craft a plan to avert pending Pentagon spending cuts.
Senate Armed Services Committee Chairman Carl Levin, D-Mich., said members of his party will craft a plan to avert pending Pentagon spending cuts. (AFP)
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On the heels of a two-day policy retreat on the Maryland shore, a senior U.S. Senate Democrat says members of his party will craft a plan to avert pending Pentagon spending cuts.

"I think Senate Democrats will offer a plan on the sequester," Senate Armed Services Committee Chairman Carl Levin, D-Mich., told reporters Feb. 7.

Before the Feb. 4-5 Senate Democratic retreat in Annapolis, Sen. Barbara Boxer, D-Calif., told Defense News that party members would discuss a sequester-avoiding bill during the event.

Levin said he intends to push his Democratic colleagues to include in the measure his plan to close tax loopholes that allow major corporations to house funds outside the United States to avoid paying taxes on some profits.

He contends shuttering those tax loopholes would "raise enough revenue to avoid sequestration." To achieve all the savings necessary to avoid twin $500 billion cuts to planned defense and domestic spending, Levin said his plan would also call for "some targeted spending cuts."

"I hope that is part of a Democratic approach to avoiding sequester," he said.

"I'm going to be sharing it today and tomorrow with my Democratic colleagues," Levin told reporters Feb. 7.

"It is unconscionable that we lose hundreds of billions of dollars of revenue because some corporations in this country avoid paying taxes by shipping revenue overseas to tax havens," he said.

Boxer has talked about applying what some Democrats and the Congressional Budget Office see as savings that will be generated when the U.S. mission in Afghanistan ends or is dramatically scaled down by late 2014.

The Levin and Boxer plans, however, remains longshots, because Republicans contend using the planned war funds in deficit-reduction math is a false equation.

More importantly, House Republicans are digging in to prevent President Barack Obama and congressional Democrats from raising any additional federal revenues as part of talks to avoid the sequester cuts and a coming fight over raising the federal debt ceiling.

"The sequester was President Obama's idea to begin with, and Democrats already got the tax hikes they wanted last month," House Speaker John Boehner, R-Ohio, said in a Feb. 8 statement.

Obama in the past has "threatened to veto any effort to replace it unless taxes went up," Boehner said. "Well, he got his tax hikes. Now we need to address our spending problem."

Boehner offered some "friendly" advice to Obama and Senate Democrats on what the upper chamber can do to avoid the pending federal cuts — and all so far have been unappealing to Democratic leaders and rank-and-file members.

Two of those suggestions are to pass bills the House passed last session that feature spending cuts most Democrats oppose. The third option is to do something the Senate, as Republicans are fond of saying, has failed to do in years: Pass a budget.

"Pass a budget that replaces the ... sequester with reforms that help balance the budget in 10 years," Boehner said. "If the Democrats running Washington could pass and stick to a budget, these challenges would be easier to address."

The sequester cuts are slated to kick in March 1 unless Congress and the White House agree on $1.2 trillion in deficit-reduction measures, or find a way, as Obama proposed earlier this week, to again delay them by a few months while talks plod on.

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