GOP senators hope for breakthrough in deficit talks with the White House

Senate GOP centrists, including some who have bucked their party’s
leaders on a series of issues in recent weeks, hope they can reach a
breakthrough this week that could lead to a deal to end the sequester.

While a grand-bargain deficit-reduction plan seems out of reach, Sen. John McCain (Ariz.) and other Republican senators believe a compromise that would end or reduce the sequester and increase agency budgets is possible. Such a deal could involve cutting entitlement spending down the road and agreeing to some higher taxes.

{mosads}“The way these things usually work, you talk and talk and talk, and then suddenly, and you reach an agreement,” McCain said Tuesday.

Sen. Bob Corker (R-Tenn.) said talks between White House staff and GOP senators last week showed signs of progress, and that this week could be the point where things get going for real.

“I thought we had a really good week last week. I thought we become more focused in what we are looking at. The next meeting will be very, very important,” he said.

McCain has been at the center of a series of deals that have angered some conservative Republicans and revived his “maverick” nickname.

The 2008 presidential candidate helped write an immigration reform bill that won 14 GOP votes but appears dead on arrival in the GOP House. He was also instrumental in reaching a deal that led to the approval of several of President Obama’s controversial nominees.

Some saw McCain’s efforts as undercutting Senate Minority Leader Mitch McConnell (R-Ky.).

McConnell spokesman Michael Brumas said Tuesday that the members of the debt talks have been regularly briefing the leader and entire conference on their talks.

Corker and McCain helped provide the 60 votes needed to confirm Obama’s controversial Labor Secretary Thomas Perez this month. The vote was crucial to preserving the deal on filibusters.

On Tuesday, Sen. Lindsey Graham (R-S.C.) said he and McCain had been asked by the president to travel to Egypt for talks with that country’s new leaders, another sign of the cooperation between the White House and some GOP senators.

Graham joined McCain in supporting the immigration deal, as did Sen. Kelly Ayotte (R-N.H.), who declined to discuss the debt talks Tuesday, and Sen. John Hoeven (R-N.D.).

If McConnell is worried about the talks, he’s not showing it.

McConnell told the National Review in an interview published Monday that he was not opposed to the talks with the White House.

“We don’t have any rules that you don’t talk to any Democrats,” McConnell was quoted as saying.

In addition, several of the participants in the talks, including Sens. Johnny Isakson (R-Ga.), Saxby Chambliss (R-Ga.) and Ron Johnson (R-Wis.), did not support the immigration deal and voted against Perez’s nomination.

This week is seen as crucial in the deficit talks given the looming August recess and just handful of legislative days in September before the fiscal year ends. Without a deal by Oct. 1, the government would shut down. In the fall, Congress also faces a second deadline for raising the government’s borrowing limit.

“We talk a lot, and we’ve come up with some principles and some numbers. It’s very tough,” McCain said. “The only thing that is a little concerning is that we’re going out of session, and there’s not much going on in August.”

GOP senators involved in talks with White House chief of staff Denis McDonough and other administration officials say they want to see a solid plan from the White House.

“We’re a sounding board, and if we start getting some concrete proposals that make sense, it could happen, but I’m not predicting it,” Isakson said.

Corker said two options are being discussed: a small deal that would replace some of the next eight years’ automatic spending cuts with different spending cuts and new taxes, or a larger, multi-trillion-dollar deal that would include broader changes to entitlements and the tax code.

“The notion of substituting some mandatory spending reductions for some discretionary spending reductions is more sensible … the bigger thing might be a bridge too far,” Corker added. “I think this week, we’ll have a better sense of which direction we’re trying to go.”

McDonough is leading the White House team, which also includes deputy chief of staff Rob Nabors and Budget Director Sylvia Mathews Burwell. They have been having frequent talks with senators, which follow up on a series of dinners and meetings Obama held earlier this year.

McCain said he has been having calls and meetings with senior White House staff “almost every day.” Other members said the GOP senators met among themselves on Monday.

Participants say they have tried to expand on elements in which the sides agree.

“It’s about figuring out about what we agree on. Don’t worry about what we don’t agree on,” Johnson said Tuesday.

Obama has floated cutting entitlement benefits by using a new inflation formula known as chained consumer price index (CPI). It would increase payments under Social Security and other programs at a lower rate to adjust for inflation. For Democrats, chained CPI has the benefit of raising taxes by lowering the adjustment of tax brackets.

Obama has also proposed more means testing for Medicare.

McCain and other defense hawks are eager to turn off automatic spending cuts to the Pentagon. They have signaled some flexibility on tax issues.

In 2014, the Defense budget is set to be hit with a $52 billion cut under sequestration.

Some Republicans have called for the party to only approve a government funding bill that defunds ObamaCare, a proposal McCain sees as foolish. 

“It’s a nonstarter,” McCain said. “We are not going to defund ObamaCare until we have 60 seats in the Senate.”