The Congressional "Super Committee" trying to agree on $1.2 trillion of deficit reduction over the next 10 years has about 10 days left to come to a consensus.
David Walker, a former Comptroller General of the U.S. and the founder and CEO of "Comeback America Initiative," thinks that the Super Committee will eventually reach a compromise. But the $1.2 trillion of cuts will barely dent the deficit the U.S. is projected to have over the next 10 years, Walker says, so this round of cuts should only be the beginning.
Our country is now run by "wingnuts," Walker says, so the Super-Committee has not made much progress on its negotiations. But the threat of more reputational damage combined with automatic cuts to defense spending if the Committee is unable to reach agreement, should prompt the Committee to form a consensus before the deadline.
What Walker would like to see is the Committee recommending far more than the required $1.2 trillion of deficit reduction and extending this "special process" (Super Committee, no filibusters) for the next round of budget negotiations.
Meanwhile, one of the most important decisions the Super Committee may make is whether to extend the stimulus payroll tax cut and unemployment benefits through 2012. If it does not, these emergency stimulus measures will roll off at the end of this year. And Goldman Sachs estimates that the failure to renew these measures could reduce 2012 GDP by as much as a point.