Reconstituted Gang of Six causes a stir

Remember the Gang of Six? Well, apparently they’re back, and they’re generating quite a bit of attention this morning with their nearly-finalized debt-reduction plan.

Democratic and Republican senators are rallying behind a $3.7 trillion deficit reduction plan unveiled Tuesday morning by the five remaining members of the Gang of Six.

Sen. Tom Coburn (R-Okla.), who pulled out of the Gang of Six in May, has rejoined the group and praised the plan as something that could win the 60 votes needed to pass the Senate.

I have not yet seen any of the details, but the plan would reportedly produce $3.7 trillion in savings over the next decade, including $1 trillion in new revenue by scrapping a series of tax breaks and tax expenditures.

Wouldn’t the new revenue necessarily mean knee-jerk GOP opposition in the House? The Gang’s members think they know a way around this.

Coburn … noted the Congressional Budget Office would score the plan as a $1.5 trillion tax cut because it would eliminate the Alternative Minimum Tax. It would generate a significant amount of revenue out of tax reform and reduction of tax rates, which authors believe would spur economic growth.

Without additional information, I haven’t the foggiest idea what could make $1 trillion in revenue look like a $1.5 trillion tax cut. It’s also unclear the extent to which the Gang tackles entitlements. I assume the details will be forthcoming soon enough, and I’ll flesh this out after I get a closer look.

In the meantime, all kinds of senators seem awfully excited about this. The Gang held a briefing this morning, presenting the plan to about 50 senators, and won some positive reviews. Just relying on media accounts, Texas’ Kay Bailey Hutchison (R), Nebraska’s Mike Johanns (R), Colorado’s Michel Bennet (D), Ohio’s Rob Portman (R), and Delaware’s Chris Coons (D) all came away impressed, and said so on the record.

So, now what? That’s unclear, too. It’s hard to imagine how this plan — the details of which are still being ironed out — could possibly be factored into the debt-ceiling talks. Regardless of merit (or lack thereof), there’s just not enough time.

And then there’s the House, which continues to believe even a penny of additional revenue is an assault on all that is good and holy. Republicans in the lower chamber are likely to care less about how the CBO would score the plan, and care more about giving Democrats the revenue they’re seeking in the compromise.

It’s nice, I suppose, to see a bipartisan group of senators getting along and working together in a reasonably productive way, but (a) the plan is still likely to be pretty bad; (b) it’s a month too late to resolve the current crisis; and (c) House passage appears to be a fantasy.

Other than that, the Gang of Six is in great shape.