Barney Frank: Have Geithner fly commercial to help cut the deficit

Rep. Barney Frank (D-Mass.) is hunting for ways to cut into the deficit and is eyeing Treasury Secretary Timothy Geithner’s travel budget.

The ranking member of the House Financial Services Committee told the supercommittee on deficit reduction Thursday that having Geithner fly commercial instead of using military transport could save “several million dollars a year.”

{mosads}Prohibiting Treasury officials from using military air transport, a practice begun under former Treasury Secretary Hank Paulson and continued by Geithner, could contribute to reining in the deficit. Each flight of this kind costs at least $150,000.

The Treasury Department said Thursday that Geithner flies economy class on commercial airlines for all domestic flights, and only takes military planes on international trips when he wants to work in transit. A Treasury spokesperson added that secretaries for “many years” have done the same, not just Paulson and Geithner.

The recommendation was part of a series of tweaks from Frank that he said could save at least $74 billion over the next decade and potentially much more because several have not been scored for deficit impact yet.

Frank joined his ranking member colleagues in offering a specific list of deficit-cutting recommendations that fall under his jurisdiction.

Legalizing and regulating Internet gambling in the U.S., a longtime cause for Frank, could raise $41.8 billion over 10 years. And a “modest increase” to the fees Fannie Mae and Freddie Mac charge to guarantee mortgages could reap another $28 billion over that same time frame. Reforming the National Flood Insurance Program to charge higher premiums that fall in line with actuarial values could yield another $4.2 billion.

One idea from Frank that has not been scored yet would be to impose a risk-based fee on financial institutions with more than $50 billion in assets and hedge funds larger than $10 billion in size. A similar idea was put forward as part of the debate on the Dodd-Frank financial reform law, but was ultimately scrapped.

Increasing fees paid by Wall Street to financial regulators could also help tackle the deficit. The Securities Investor Protection Corporation exists to protect investors in the case their broker-dealer fails. It is funded through fees paid by the industry. By increasing the size of that fund from $2.5 billion to at least $10 billion, the government could enjoy enhanced revenues via those fees.

Similarly, increasing the size of a reserve fund for the Securities and Exchange Commission from $100 million to at least $1 billion would have a similar effect because it is also funded via industry fees.

This post updated at 3:21 pm.