Snowe, Collins support closing tax loopholes to lower debt

By Mal Leary, Capitol News Service
Posted July 10, 2011, at 3:44 p.m.

AUGUSTA, Maine — Don’t look for members of Maine’s congressional delegation to support cuts in Social Security or Medicare as part of the debt limit legislation, but all four say a debt reduction package that includes budget cuts and new revenues is likely.

“There are solvency problems with both programs,” Sen. Olympia Snowe said in an interview on Friday, “They have to be addressed but not as part of the debt reduction talks.”

She said any debt reduction plan worked out by President Barack Obama and congressional leaders will still need the support of members of both parties and both Medicare and Social Security have strong bipartisan support.

“The talks between the President and congressional leaders should have happened in January,” Snowe said. “Everyone knew we would be coming up against the debt limit and that we needed to take action to reduce spending but it kept being put off until it has to be addressed and it has to be addressed.”

She said she has no idea what will come out of the budget talks but she believes to get enough votes to pass it will have to have cuts in spending and additional revenue.

“We are not talking about raising tax rates,” she said, “but there are a lot of tax credits that are not needed and should be repealed.”

Sen. Susan Collins agreed. In an interview Friday she said the Senate has already voted to end the tax subsidy for ethanol production and that would save close to $6 billion a year. She said there are many other agricultural subsidies that should be repealed.

“We spend billions of dollars a year in subsidies that go to some very wealthy corporate farmers,” she said. “It has always troubled me that if you grow blueberries or potatoes you get absolutely no price subsidy, but if you grow corn, wheat, soybeans or rice you get a guaranteed price and the taxpayers pay the bill.”

Collins said there are also plenty of examples of wasteful spending that can be cut. She said a second type of engine for the new joint strike fighter aircraft is unneeded and eliminating would save billions.

She said while she hopes the Obama and congressional leaders can work out a package, she believes the best process would be in the regular budget process that has not been followed.

“With all of these short-term extensions and budgets we have seen a lot of unintended consequences,” Collins said. “It is better to have issues vetted in the hearing and mark-up process.”

Second District Rep. Mike Michaud said he is worried about a polarization in the House that could block passage of any package. He said in an interview that there are democrats vowing to vote against any package with budget cuts and republicans vowing to vote against any package with increased revenues.

“There has to be both,” he said. “It’s my hope we can get both sides to talk and to compromise because we have to solve this because failure is not an option.”

Michaud said the current level of debt, where 40 cents of every tax dollar is being used to pay interest on the federal debt, is unsustainable. He said to get his vote a package will need to substantially reduce the debt through a combination of new revenues from losing tax loopholes and cutting spending.

“That includes some cuts to programs I don’t want to cut,” he said, “because we have to solve this.”

In an interview First District Congresswoman Chellie Pingree said she would vote for an increase in the debt limit without a package of cuts and revenues. She said the issue of reducing the deficit should be separated from the debt limit because of the potential impact on the economy if the United States can’t pay its bills.

“Much of what is going on now is sort of the political politics that makes the economy nervous, makes the American people nervous and does not move us forward, “she said.

Pingree said she hopes a deal can be brokered to raise the debt limit and avoid the unknown consequences of a United States Treasury that can’t pay the bills.

“Hopefully we are moving closer to getting an agreement on this so we can move on to addressing the issues we need to address like taking steps to help create more jobs in this country,” she said.

All four members of the delegation said they do not have any inside information about what is being negotiated, but Collins said she is willing to bet the package will be a long-term major package and not just a short-term fix.

 

http://bangordailynews.com/2011/07/10/politics/delegation-worried-about-debt-limit-proposals/ printed on August 23, 2014