Can the Gang of Six deliver? Will it matter?

The most interesting phenomenon in Washington at the moment (and I said most interesting, not most entertaining, which we all know is the Donald) is the bipartisan Gang of Six senators who are working to achieve a long term budget deal to achieve $4 trillion in savings - a target similar to the Bowles-Simpson Deficit Commission report from December. Two members appeared on Meet the Press this week and reported that they were close to agreement.

The idea is that if this ideologically diverse group can reach an agreement - with progressive Dick Durbin, the #2 Democrat in the Senate and former senior senator to one, Barack Obama, leading one side, and the conservative Saxby Chambliss, friend of Speaker Boehner, on the other, then their plan can garner 60 votes in the Senate, gain the support of the President (with tinkering), and put the House in the position of choosing between historic deficit reductions and stalemate & the status quo. Speaker Boehner hems and haws, but then does the right thing, bucks the Tea Party and core conservatives, and forms a coalition with centrist Democrats to pass the plan.

My guess is that you don't appear on Meet the Press and say you are close to an agreement unless you indeed are going to get one. And I also think that these Senators have gone so far down this path, and already withstood abuse from their respective left and right flanks of their party (one for considering net revenue increases and the other for accepting the need for cuts in entitlements), that they will indeed cut the deal. The tax issue is clearly the most sensitive - and it appears that the way they square this circle is by cutting out tax deductions and credits, while leaving individual rates where they are now, getting rid of a lot of corporate loopholes and then cutting the overall corporate tax rate. They will say this is tax reform that generates new reveune without increasing individual tax rates and that it will help grow the economy. It remains to be seen how they propose to slow growth of Medicare or make Social Security solvent, but they probably endorse many of the Bowles-Simpson proposals.

Politically, this group looks at all the polls showing little public support for specific spending cuts or tax increases and argues that the public will support cuts and taxes in the context of a plan that reduces the deficit to a manageable level, makes entitlement programs sustainable, and is crafted to grow the economy. Maybe they are right, but it will be hard to notice any groundswell of public support for this package compared to the noisy opposition to tax increases and Medicare cuts that has already started to appear on the airwaves.

While a deal by the Gang might would be a big achievement, I have a hard time seeing many of the other political pieces falling into place. You don't get to be president without being an exceptional politician - and Obama is staying above the fray for a reason. There is also no softening on the right on the tax question. Boehner pretty much said this week that any increases in net revenues is a non-starter in the House. I'm not even sure that you get to 60 votes in the Senate or that the deal could survive the committee or Senate floor amendment process intact.

The idea that something this massive could be pushed through the American political system in what is left of 2011 seems unrealistic -- although there would be a sympathetic press corps cheering the Gang on. The more likely result is that Ryan and Obama's plans frame the debate for the 2012 election, the new or relected president claims a mandate for his or her plan and the Gang's agreement becomes the starting point for the negotiations in January 2013.