Open Thread: What Will Happen With Supercommittee Defeat?

The congressional supercommittee tasked with finding ways to reduce the federal deficit is looking like they will admit defeat sometime today. The failure of the supercommittee will create and end of the year battle over jobless benefits and an expiring payroll tax, among other programs set to expire at the end of December.

Democrats on the committee are seeking to extend jobless benefits, which currently supports about 3.5 million people for up to 99 weeks of unemployment, and the one-year payroll tax cut. However, extending all the programs through 2012 would add around $300 billion to the annual budget. Sen. Jeff Sessions (R-Ala.) explained that extending the payroll tax holiday is not the biggest problem in the face of the "greater threat" of the national debt.

What do you think will happen if and when the supercommittee fails? Let us know your thoughts in the comments.

As reported at the Washington Post, Sessions continued:

"If the supercommittee fails, I think there will be a stark realization by every member of the U.S. Senate that we’re at the end of the year and these complex challenges have not been dealt with,” Sessions said. “It’s likely to be a really difficult period.”

The battles over which cuts to make comes at the same time as a number of officials are gearing up for their 2012 campaigns. If the supercommittee fails to produce a plan, it will lose its power to push a tax-and-spending plan through the House and Senate, eliminating any easier compromises on the expiring provisions.

Republicans have mixed views on where cuts should be made:

...Rep. Nan A.S. Hayworth (N.Y.) said she is “extremely sympathetic to extending” the payroll tax holiday, but Rep. Jason Chaffetz (Utah) said he would have trouble supporting it without matching cuts in spending.

“I’m in favor of lower taxes. But, when you don’t couple it with a spending decrease, it’s a real problem,” Chaffetz said. “And we don’t seem to be able to cut anything around here.”

President Obama has called for extending payroll tax cuts and overhauling unemployment insurance, a $447 billion cost, all while not increasing budget deficits. His suggestion was raising taxes on corporations and those earning a higher income. 

And naturally, any failure to reach a deal is sure to be blamed by the liberal media on conservatives. Will the right be able to effectively push back against this? Where do you think the biggest cuts should be made?

Economy Open Thread