Yet another glimmer comes from within Republican ranks. A behind-the-scenes discussion is under way, on and off Capitol Hill, that could clear the way for some GOP lawmakers to agree to close tax loopholes – a move that would raise government revenues – on grounds that cutting these "tax expenditures" will actually reduce the sway of big government and spur economic growth. It's a delicate issue for elected Republicans, almost all of whom have pledged not to raise taxes – and not to end tax breaks, unless the resulting revenue increase is offset dollar for dollar by new tax cuts.
Much is at stake as the Joint Select Committee on Deficit Reduction, as the panel is officially known, knuckles down ahead of its pre-Thanksgiving deadline. The panel could opt to undo decades of work by K Street lobbyists who carved out tax and other advantages for their causes and corporations. It could raise the standing of Congress by presenting a viable plan that distributes the pain, or it could further sink the institution's public esteem by dissolving in acrimony and stalemate. It could put the federal government on the path to fiscal responsibility, or it could punt – and risk a rebuke from the markets and the rating agencies that determine America's creditworthiness.
"The super committee represents our best, and possibly only, chance to make the real reforms needed to return our country to fiscal health," said Rep. Mike Simpson (R) of Idaho in a statement, as the Nov. 2 bipartisan letter made its way to the panel.
No one, however, should be sanguine about the panel's prospects. Powerful forces drive lawmakers to hold to partisan lines. For Republicans, it's a commitment to no net increase in taxes. For Democrats, it's no significant cuts to entitlement spending, such as Medicare, Medicaid, or Social Security, unless Republicans agree to tax hikes.
That impasse puts taxes at the center of any bid to reach a deal. Nearly every Republican in Congress – and all six GOP members of the deficit panel – have signed the "taxpayer protection pledge" maintained by Americans for Tax Reform (ATR) and its president, Grover Norquist.