REUTERS/Eric Miller

Sen. Al Franken

WASHINGTON — The Senate was scheduled to have this week off after the Fourth of July holiday. Instead senators are back in Washington, and the federal budget is the topic taking center stage.

A group of Democrats, including Minnesota’s Al Franken, affirmed their support for higher top-tier taxes Wednesday, a day before a non-binding resolution calling for higher taxes on millionaires could hit the Senate floor. The senators’ endorsement of such plan came just after the chair of the Senate Budget Committee introduced his colleagues to a left-leaning budget plan that relies almost equally on tax increases and spending cuts to trim the federal deficit.

Speaking at a Capitol news conference, Franken and a handful of other Senators targeted the Republican House budget plan, contending the budget cuts Medicare funding at the expense of tax breaks for the wealthy. The group painted Republicans as supporters of tax cuts for, among other things, “yachts, race horses and gold mines.”

The group backed what it purported to be a more balanced budget solution that blended spending cuts and tax increases on the rich.

Franken harkened back to the Bill Clinton presidency, pointing to Clinton’s support for higher taxes in a deficit reduction package in 1993, just before an economic expansion.

 “Nobody here is saying raising revenue on the wealthiest Americans will solve this problem on its own,” Franken said. “Only with the right balance of spending cuts and increased revenues can we make real progress on the long-term fiscal crisis.”

REUTERS/Jonathan Ernst

Sen. Kent Conrad

Franken and other Democrats have an opportunity to support such a plan immediately. Senate Budget Committee Chairman Kent Conrad introduced a budget proposal Wednesday that would relay on equal parts spending cuts and tax increases to reduce the federal deficit by about $4 trillion over the next 10 years. To contrast, President Barack Obama’s deficit reduction plan achieves similar savings but relies on three-fourths spending cuts.

Though Conrad’s plan is unlikely to pass the Senate — Democrats hold only 53 seats, but 60 votes are required to end debate on bills — some Democrats stood behind the measure.

In a speech on the Senate floor, Minnesota Sen. Amy Klobuchar said she would support a budget plan that features a “mix of revenue with realistic spending cuts.

“The budget that Senator Conrad has been working on with the budget committee is an example of the mix of those revenues and spending cuts,” she said. “That's what we have to look at.”

Franken told MinnPost, “Sen. Conrad’s proposal achieves these [$4 trillion] savings in a balanced way: it makes responsible cuts while preserving investments in education, energy and infrastructure — key components to maintaining US competitiveness."

Both parties target tax loopholes
Part of Conrad’s budget would rely in part on ending some tax loopholes, exemptions and deductions built into the tax code that have been a hot topic for both parties to look at as potential options for solving the nation’s debt ceiling debate.

House Majority Leader Eric Cantor said Wednesday that he was open to considering ending certain loopholes as part of a deficit reduction package attached to an increase in the debt ceiling.

REUTERS/Larry Downing

Rep. Eric Cantor

President Obama has said ending such tax loopholes should contribute to such a plan, which must pass before Aug. 2. Cantor indicated that his could support some such measures, but with the caveat that “any discussion about loopholes must be accompanied by offsetting tax cuts. That's all. We are not for increasing revenues.”

The Senate has already voted to end  one of those loopholes — a $5.4 billion ethanol subsidy. Klobuchar is helping lead the effort to determine where to steer the savings.

She said on the floor Wednesday that an agreement on the ethanol subsidy “would be a template where one industry says, ‘OK, we understand we have got a big problem here, we're willing to put money up front for the debt, we're willing to look at what we need to do in the long-term to have a secure energy policy but also to help with the debt and end this subsidy.’ We'd like to see [the oil industry] do the same thing. We'd like to see a lot of these loopholes … closed, a lot of these subsidies end and to do it in a smart way.”

Cantor’s newly voiced support for ending the loopholes hinted at a potential opening for a deal between Congressional Republicans and the White House, though whether the savings from such a move goes toward tax breaks or deficit reduction remains a significant sticking point.

Speaking at the same press conference as Franken, Michigan Sen. Debbie Stabenow said turning the money around and using it for reducing tax levels is “not something we can afford anymore without evaluating every single one of those spending measures.”

Congressional leaders will meet with Obama at the White House today to continue debt limit talks.

According to the Washington Post, Obama will propose big reductions in Medicare spending and offer to tackle the rising cost of Social Security in exchange for GOP support for new revenues.

Devin Henry can be reached at dhenry@minnpost.com.