Why the Super Committee Failed

By JEB HENSARLING

All now know that the Joint Select Committee on Deficit Reduction has failed to reach an agreement. While there will still be $1.2 trillion of spending cuts as guaranteed under the Budget Control Act, we regrettably missed a historic opportunity to lift the burden of debt and help spur economic growth and job creation. Americans deserve an explanation.
President Obama summed up our debt crisis best when he told Republican members of the House in January 2010 that "The major driver of our long-term liabilities . . . is Medicare and Medicaid and our health-care spending." A few months later, however, Mr. Obama and his party's leaders in Congress added trillions of dollars in new health-care spending to the government's balance sheet.
Democrats on the committee made it clear that the new spending called for in the president's health law was off the table. Still, committee Republicans offered to negotiate a plan on the other two health-care entitlements—Medicare and Medicaid—based upon the reforms included in the budget the House passed earlier this year.


The Medicare reforms would make no changes for those in or near retirement. Beginning in 2022, beneficiaries would be guaranteed a choice of Medicare-approved private health coverage options and guaranteed a premium-support payment to help pay for the plan they choose.
Democrats rejected this approach but assured us on numerous occasions they would offer a "structural" or "architectural" Medicare reform plan of their own. While I do not question their good faith effort to do so, they never did.
Republicans on the committee also offered to negotiate a plan based on the bipartisan "Protect Medicare Act" authored by Alice Rivlin, one of President Bill Clinton's budget directors, and Pete Domenici, a former Republican senator from New Mexico. Rivlin-Domenici offered financial support to seniors to purchase quality, affordable health coverage in Medicare-approved plans. These seniors would be able to choose from a list of Medicare-guaranteed coverage options, similar to the House budget's approach—except that Rivlin-Domenici would continue to include a traditional Medicare fee-for-service plan among the options.
This approach was also rejected by committee Democrats.
The Congressional Budget Office, the Medicare trustees, and the Government Accountability Office have each repeatedly said that our health-care entitlements are unsustainable. Committee Democrats offered modest adjustments to these programs, but they were far from sufficient to meet the challenge. And even their modest changes were made contingent upon a minimum of $1 trillion in higher taxes—a move sure to stifle job creation during the worst economy in recent memory.

WSJ Editorial Page Editor Paul Gigot appears on OJ Live to discuss why the super committee couldn't reach an agreement. Plus, a discussion of the recent passing of business leader Ted Forstmann.

Even if Republicans agreed to every tax increase desired by the president, our national debt would continue to grow uncontrollably. Controlling spending is therefore a crucial challenge. The other is economic growth and job creation, which would produce the necessary revenue to fund our priorities.
In the midst of persistent 9% unemployment, the committee could have enacted fundamental tax reform to simplify the tax code, help create jobs, and bring in over time the higher revenues that come with economic growth. Republicans put such a plan on the table—and even agreed to $250 billion in new revenue by eliminating or limiting most of the deductions, credits, loopholes and tax expenditures mainly enjoyed by higher-income Americans. We offered this to avoid the even larger tax increases already written into current law that will intensify the pain Americans are feeling during these difficult economic times.
Republicans were willing to agree to additional tax revenue, but only in the context of fundamental pro-growth tax reform that would broaden the base, lower rates, and maintain current levels of progressivity. This is the approach to tax reform used by recent bipartisan deficit reduction efforts such as the Bowles-Simpson fiscal commission and the Rivlin-Domenici plan.
The Democrats said no. They were unwilling to agree to anything less than $1 trillion in tax hikes—and unwilling to offer any structural reforms to put our health-care entitlements on a permanently sustainable basis.

Enlarge Image

Getty Images

Congress goes home for the holiday.

Unfortunately, the committee's challenge was made more difficult by President Obama. Since the committee was formed, he has demanded more stimulus spending and issued a veto threat against any proposed committee solution to the spending problem that was not coupled with a massive tax increase.
Despite the president's disappointing lack of leadership, I believe my co-chair, Sen. Patty Murray, and every Democrat acted with honor and integrity and negotiated in good faith to the end. It was, of course, difficult to negotiate with six Democrats who, as Democratic committee member Jim Clyburn said on Nov. 13, "never coalesced around a plan" themselves. But I believe this failure was not due to lack of effort or commitment.
Ultimately, the committee did not succeed because we could not bridge the gap between two dramatically competing visions of the role government should play in a free society, the proper purpose and design of the social safety net, and the fundamentals of job creation and economic growth.
A great opportunity has been missed, but America's fate will not be sealed by the failure of a temporary congressional committee. Spending cuts will begin anyway in 2013, but in a manner many of us, including our secretary of defense, believe could fundamentally harm our national security. I am committed to ensuring that full deficit reduction is realized, but Congress must work to achieve these savings in a more sensible manner that does not make us less safe.
As Winston Churchill said, "Americans can always be trusted to do the right thing, once all other possibilities have been exhausted." Despite my disappointment with the committee's setback, I remain confident that we will yet again prove Churchill right.
Mr. Hensarling, a Republican congressman from Texas, was co-chair of the Joint Select Committee on Deficit Reduction.