Bowles sees "progress" on "fiscal cliff"


(CBS News) On CBS News' "Face the Nation," two deficit reduction experts discussed the stalled talks in Washington over the "fiscal cliff." Despite the logjam and lack of progress between President Obama and House Speaker John Boehner about how to avert end of the year spending cuts and tax hikes that could throw the economy back into recession, former President Clinton chief of staff Erskine Bowles said he is "more encouraged" than he had previously been.

"I think we made some progress this week, Bob. I'm more encouraged than I was," Bowles, who co-chaired Mr. Obama's fiscal commission in 2010, told host Bob Schieffer.

"We were going through the kabuki theater, one side making an offer and the other side rejecting it. That's natural in any deal," Bowles said. He called that progress. "Any time you have two guys in there tangoing you have a chance to get it done."

Bowles said movement is apparent because both sides have taken positions that differ from previously hardened stances. He noted Boehner's willingness to increase taxes and the president's openness to cut entitlements.

Although Bowles expressed some optimism, he said the president has to go further. He said the president's proposal to cut around $350 billion to Medicare is "not enough."

"We simply made promises we can't keep. We've got to face up to it," Bowles said of the health care program for seniors. "We're going to have to do more."

Former Sen. Alan Simpson, R-Wyo., who co-chaired the president's fiscal commission with Bowles and now runs the Fix the Debt campaign, agreed.

"The entitlements are the engine on the train driving us to the cliff. They were on automatic pilot," Simpson said.

He added that the AARP and other senior groups "will have stripped the treasury dry in 30 years" because of the rising cost of health care and number of baby boomers aging into entitlement programs. That's why he said he danced "Gangnam Style" in a You Tube video to persuade young kids to "get off your can."

"[T]hey're the ones who are going to get it kicked right in the fanny," the 81-year old said. "Nobody has any humor in Washington. There ain't none left."

"[I]f anybody out there who is, quote, rich doesn't think their taxes go up, the drinks are on me," Simpson said.

But Simpson advocated a position similar to Boehner's. He promoted raising taxes by limiting tax expenditures through tax reform that should take place after the New Year. Simpson emphasized, like Bowles did, that entitlements must be reformed.

Simpson and Bowles became prominent voices in the deficit reduction debate in 2010 while co-chairing a bipartisan committee that came up with a plan to reduce the deficit by $4 trillion over 10 years. At the time, the president did not embrace the plan and Congress failed to pass it.

Bowles said it would be a "disaster" to go over the "cliff" because it would slow the economy by four percent and businesses are already "slowing their head count" and cutting their capital expenditures.

Simpson said Washington lawmakers who are playing politics with the "fiscal cliff" by saying it would help their argument down the line are acting "terribly bizarre and juvenile."

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    Leigh Ann Caldwell is a political reporter for