Capital Corner:  The State of the Supercommittee

Jim Brandenburg, CPA, MST, Shareholder - Tax   email | bio
October 2011 

As many of you have heard, a special select committee (also known as the "Super Committee") in Congress was recently appointed and will soon begin its work. The Super Committee, which is comprised of key senators and congressmen from both parties, was created as a result of this summer's negotiations regarding increasing the federal debt ceiling. The committee was given specific tasks to address, including:

•   Identifying spending "cuts" in the projected spending of the federal budget over the coming decade; and/or
• Considering tax increases, which might include overall tax reform.

If a consensus plan for spending cuts and/or tax increases is reached by this committee, the plan must still run the obstacle course of being passed by both the House and the Senate before moving on to the president for his signature. If no plan is reached by the Super Committee before the end of the year, then under the agreement reached this summer to raise the debt ceiling, automatic spending cuts will be triggered and will apply to both military and non-military domestic programs. (Keep in mind, spending cuts in Washington are not necessarily reductions in spending when compared with the prior year's spending on a particular program; rather, they are just lower increases in the projected levels of future spending. So, when all the rhetoric is tossed around, remember, a spending cut may not actually be a true cut in spending.)

This Super Committee is relatively unique in Washington, and growing attention will be focused on it. Lobbying by various groups will be intense, as will be political pressure from inside the Capitol. Due to the fact the establishment of this super group of legislators and its format are new, it is hard to anticipate what will be produced. It could perhaps be more of the same: lots of talk, lots of spin, and lots of politicking that in the end does not lead to a breakthrough agreement.  And even if something does come out of the Super Committee, the agreement could be shot down by either the House or the Senate.  

Perhaps this is a "glass half empty" outlook, or perhaps the real reason for my lack of concentration on the national Super Committee is my (and probably yours as well) distraction with the current sports scene in Wisconsin. Yes, the dairy state now is the envy of the sports world with our Packers, Badgers and Brewers in the national limelight. In fact, the State of Wisconsin could be said to have its own Super Committee-not comprised of Governor Walker, Senators Kohl and Johnson, or any other elected official, but instead ours would include the leaders of these sports teams - GM Ted Thompson and Coach Mike McCarthy of the Packers; AD Barry Alvarez and Coach Bret Bielema of the Badgers; and GM Doug Melvin and Manager Ron Roenicke of the Brewers. I believe that if the Wisconsin Super Committee was assigned the task of fixing the nation's debt crisis and budget deficit, they would roll-up their sleeves, get down to work, stop pointing fingers and get the job done! I know it will never happen, but it probably couldn't hurt. 

Anyway, we'll see what happens in Washington, but in the meantime enjoy Wisconsin's Fall to Remember! 

Here We Go Brewers, Here We Go...Go Pack Go...and On Wisconsin!