Political Memo: After Snips to Budget, a Thicket Looms

With time growing short before an Aug. 2 deadline to raise the federal debt limit, Republican and Democratic lawmakers meeting with Mr. Biden behind closed doors are just beginning to weigh the big fiscal trade-offs necessary for a compromise that could clear the way for a Congressional vote.

An accelerated schedule of meetings for next week will test whether the six members of the House and Senate talking with the White House are willing to entertain the serious political concessions and to make the hard choices needed to cut a deal in time.

In the colorful phrasing of Mr. Biden, the moment has arrived to find out who is willing to trade their side’s bicycle for the other side’s golf clubs.

“The really tough stuff that is left are the big-ticket items,” Mr. Biden said Thursday at the conclusion of the week’s third bargaining session, meetings that took lawmakers and administration officials to every corner of the federal budget in a search for consensus on ways to save federal dollars.

Lawmakers and aides say the negotiators quickly gobbled up low-hanging fruit like trimming agriculture subsidies and selling more of the telecommunications spectrum to generate revenue. There is a general consensus that federal workers are going to have to contribute more to their pensions, though the details are still to be determined. The Pension Benefit Guaranty Corporation will collect higher fees from stable companies, and some idle federal property could be up for sale.

But those actions are not going to produce anywhere near the $2 trillion or more in savings that both sides agree is the level required to win a debt limit increase while putting the government on course to save $4 trillion over the next decade — a goal set by Mr. Biden.

To get there, negotiators are going to have to make some excruciating choices about federal health care and safety-net programs, as well as the tax structure. At the same time, they need to reach a deal that not only can be sold to a bipartisan majority in the House and Senate, but also is credible enough to assure investors worldwide that Washington is getting serious about taking care of its financial health.

Representative Chris Van Hollen of Maryland, the senior Democrat on the Budget Committee and a participant in the talks, said one reason for setting three-hour meetings four times next week is to gauge whether he and his fellow budget bargainers can ever come to terms.

“We are picking up the pace in a big way, recognizing that we’ve got to determine whether we can reach agreement in principle or recognize that we are not able to bridge our differences,” he said.

Watching the clock, Senator Harry Reid, the Nevada Democrat and majority leader, on Friday called on the negotiators to keep working through the Fourth of July recess if necessary.

To Democrats, a major impediment is the Republican position against relying on any significant new revenues as part of the deal, insisting that most of the $2 trillion or more come from cuts in federal spending — although not from Pentagon spending, a major potential source of savings.

Democrats say they will never be able to sell a compromise without some new revenue to their colleagues in the House and Senate. They say the most affluent Americans should contribute to the debt limit deal through new taxes on hedge fund operators or by phasing out tax deductions for those at the highest levels of earnings.

But Representative Eric Cantor of Virginia, the majority leader who is representing House Republicans in the talks, on Thursday reiterated the deep Republican opposition to higher taxes.

“Our side will not support any attempt to raise the debt ceiling that is not accompanied by the kinds of cuts necessary or reforms necessary,” he said. “Nor will we support an attempt to raise the debt limit that raises people’s taxes. That, we don’t want to do.”

Republicans want to see Democrats embrace more changes in Medicare and Medicaid, the federal health programs for older Americans and the poor.

Democrats have so far pushed for modest changes like allowing the government to negotiate prescription prices with drug companies and to require drug industry rebates for people eligible for both Medicare and Medicaid — a proposal that could potentially generate tens of billions of dollars. But Democrats will not support any major Medicare overhaul, saying they believe that they have the political high ground on the issue at the moment.

To get a deal, lawmakers on both sides are going to have to bend considerably and back unpopular positions. They are then going to have to sell the plan to their rank and file on the grounds that they need to avert the economic disarray that could result from a failure to raise the debt ceiling.

Both sides say that all those in the talks want to reach a compromise. “There is no principal in that room that doesn’t want to get agreement,” Mr. Biden said.

Yet that is no guarantee that the deal will be done.

“I’m confident,” said Representative James E. Clyburn of South Carolina, another top Democrat in the talks. “But I’ve been confident before and come up short.”

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Anxious Eyes on the River As Flooding Threat Looms

 

CHARLESTON, Mo. — Maj. Gen. Michael J. Walsh of the Army Corps of Engineers is likely to make a lot of people angry over the next few days.

But which group of people is not so clear. It will depend on whether he decides to flood farmland in Missouri in order to save a town in Illinois from the ravages of the rising Mississippi and Ohio Rivers.

If the general gives the word, his team will blow up a two-mile stretch of levee, sending torrents of water across more than 200 square miles of Missouri farmland to take pressure off the levees that protect Cairo, Ill., to the north.

Missouri officials sued this week to block the corps from moving forward with the plan to swamp the Birds Point-New Madrid Floodway. Cairo has about 3,000 people; the 130,000 acres of farmland is home to about 200 residents in 90 homes. On Friday morning, Judge Stephen N. Limbaugh Jr. of Federal District Court in St. Louis ruled that the corps could go forward, if necessary.

General Walsh said he had sympathy for the farmers. “Many of the people who have lived in the floodway, I’ve known them for two or three years,” he said. “I know what this is going to do, if we open the floodway.”

But, he added, “when it comes down to a discussion of livelihood versus lives, the decision is a little easier to make.”

Col. Vernie Reichling, the corps commander of the Memphis District and General Walsh’s eyes and ears for the northern portion of the Mississippi River and Tributaries project, said, “We’re listening to the river.”

“It’s now an art — based on science, but it’s an art,” Colonel Reichling said.

As the river rises to historic levels, General Walsh, who commands the Mississippi Valley Division of the corps, is consulting with dozens of engineers, meteorologists and other experts on a decision that is complicated by the way the river is riding perilously close to the informal trigger point of 61 feet.

“If it was 68, that would be an easy decision,” he said. “If it was 58, I wouldn’t have to make the decision.”

If the river recedes rapidly, no action will be necessary. But if it stays near current levels, the risk to Cairo and other communities will remain high, and a decision not to act could leave residents of the economically depressed, largely African-American town feeling that they have been left to the vicissitudes of nature.

Cairo’s defenses can hold up against the pressure for only so long, Colonel Reichling said on a drive through the town to inspect the flood defenses.

“These are temporary restraining structures,” he said. “They’re not meant to permanently contain water.”

On Friday, the river stood at 59 feet, but it is expected to rise to a record 60.5 feet, still below the 61-foot mark, but some of the colonel’s experts are saying it may stay at that level for six or seven days. That creates problems of its own, further weakening the earthen levees and saturating the soil beneath.

“This has been the most amount of pressure that these systems have ever been under,” Colonel Reichling said. “We’re seeing a lot of seepage behind the berms.”

If General Walsh does order the levee breached, two barges loaded with 265 tons of explosives will make a 30-mile journey upriver from their current mooring in Hickman, Ky.

They will arrive at the Birds Point levee, where the explosives will be loaded into three sets of pipe spanning 11,000 feet buried in the soil. After laying a detonating cord, the corps team will prime them with C-4 explosives before installing the blasting cap and pushing the button — electronically, and from a safe distance. The operation will take 24 hours to complete.

The floodway is, in effect, a gigantic relief valve. The gap created by the controlled explosion on the west bank of the Mississippi would send water rushing at more than four million gallons per second into a basin bordered several miles to the west by a setback levee and encompassing some 200 square miles of farmland. The water would re-enter the Mississippi at the southern end of the basin by way of two openings that the corps will also blast. Using the floodway should reduce the height of the river above it by several feet.

General Walsh said this was not the most agonizing situation he had been in in his career in the corps. As the commander for the corps’ Gulf Region Division in Baghdad, he recalled, he managed construction of buildings in the villages where “we were always taking incoming fire” and a children’s hospital in Basra when “thugs and criminals were in control of the city.”

“We lost a number of folks while we were building that facility,” he said. Often, engineering decisions implicitly involve life-or-death decisions, based on safety tolerances and risk factors. “Almost every decision has that kind of connotation to it,” General Walsh said, but the Mississippi choice “is certainly a little bit more immediate.”

Russ Davis, chief of the Operations Division, said of the floodway: “Soldiers train to go to war, but hope they never have to. No one wants to do this.”

If General Walsh does order breaching of the levee, the result is likely to seem undramatic to those raised on action movies, said Paul N. Worsey, the director of explosives engineering education at the Missouri University of Science and Technology in Rolla.

? “It’s not like a nuclear weapon going off,” Mr. Worsey said. “It’s going to look like a big a big burp, then there’s going to be a big lake. It may end up, when it goes, being a very big anticlimax — apart from all of the water rushing in.”

Even if the General Walsh does not act at Birds Point, the crisis will not be over: the massive bulge of water will move inexorably downstream, threatening points south.

“We won’t be out of the woods,” Colonel Reichling said. “That water is going to move down to Louisiana, and we’re going to have to fight it again.”

 

Decision Looms for Laos Dam, but Impact Is Unclear

 

On Tuesday the four countries that share the lower reaches of the Mekong River will announce whether they agree to the construction of a controversial dam, a decision that could forever alter the character and natural diversity of one of the world’s longest and most bountiful rivers.

The proposed dam, known as the Xayaburi for the province in Laos where it is located, is a test case for a 1995 agreement signed by Laos, Thailand, Cambodia and Vietnam to share the river’s resources — its fish, water and the minerals carried by the silt that fertilize the soils of places like the Mekong Delta. The agreement, which called for a process of consultation on actions affecting the river, was seen as a major step toward greater cooperation for countries that a few decades ago, during the Vietnam War, were often at odds.

But Laos appears to be undermining the spirit of that cooperation. All four countries retained the right to build dams with or without agreement by neighboring countries. And here at the proposed site of the Xayaburi Dam, work has been under way since November. The area is teeming with trucks and hundreds of workers who have cleared an access road, built barges and set up concrete mixing facilities.

China, which was not part of the cooperation agreement, has already built four dams closer to the river’s source. Yet the dam in Laos is considered by many as pivotal because it could affect fish migration patterns and kick off the construction of at least five other dams already slated for the lower reaches of the Mekong.

Studies by experts on Xayaburi’s environmental impact are filled with apprehension and criticism, doubts that may be the seeds of future conflicts between countries sharing the river.

Senator Jim Webb, a Democrat from Virginia who heads the Senate’s Subcommittee on East Asian and Pacific Affairs, last week criticized the dam project for what he called a failure to meet international standards. He predicted that a lack of coordination between the countries that share the Mekong would have “devastating consequences.”

“The United States and the global community all have a strategic interest in averting regional conflict by preserving the health and well-being of the more than 60 million people who depend on the Mekong River,” he said in a statement.

The news media in Vietnam, which normally hew to the government’s line, have been unusually critical of the project. Farmers in the Mekong Delta fear that an accumulation of dams on the river could reduce the volume of water that reaches Vietnam, exacerbating the problem of saltwater seeping into farming areas from the sea.

A report published by the head office of the Mekong River Commission, the organization set up to coordinate dam projects on the river, described “fundamental gaps in knowledge” about how migratory fish would be affected by the dam. Experts hired by the commission estimated that the dam would curtail the migrations of anywhere from 23 to 100 species of fish. It described as “ineffective” a device proposed by the Thai construction company carrying out the project to allow fish to bypass the dam. And it said there was a “strong possibility” that one of the river’s most distinctive species, a giant catfish that can exceed the weights of several full-grown men, would become extinct.

But perhaps most striking is the commission’s estimate that the dam’s ability to produce electricity will be severely compromised within a few decades because the dam’s reservoir will fill up with silt. (The plan calls for a generating capacity of 1,285 megawatts, enough to power a small or medium-size city; most of the electricity will be sold to Thailand under an agreement already signed between the dam’s builder and a Thai utility company.)

“It is expected that under proposed operating conditions, the reservoir would effectively lose about 60 percent of its capacity due to sedimentation after 30 years,” the commission’s report says.

Thus, critics say, the dam will have permanent consequences for life in the river, including possible extinction of larger species, but may only produce several decades of electricity.

The Laotian government has responded to questions and criticisms about the dam with a stout defense of the project. The dam, which is situated between steep hills and will span a distance of about eight football fields, will have the same impact as a “natural waterfall,” the government said in response to the report by the Mekong River Commission.

Embracing hydropower will alleviate the need for “big power plants which cause a lot of pollution,” the government said. “Hydropower project development which is a green energy shall be strongly promoted and supported,” it concluded in its response.

Landlocked and sparsely populated, Laos is counting on revenues from hydropower to help lift the country out of poverty and finance government programs.

The government says it plans to become “the battery” of Asia with a total of 70 hydroelectric projects, 10 of which are already in operation. The Xayaburi Dam would take seven years to build.

CH. Karnchang, the Thai construction company carrying out the project, refused to allow a reporter to visit the proposed dam site. But it was possible to reach it by chartering a boat and walking several kilometers along the river bank.

In villages near the dam site people seem divided about the project. The government has proposed moving people who live in villages that will be flooded by the dam’s reservoir to a spot farther upstream and says it will provide electricity, which they currently do not have. But some villagers said they were told their new dwellings would not be along the riverbank.

“The government has already told us three times that we need to move out,” said Sripan Sukaew, a fisherman who lives in this village overlooking the dam site. “I’ve been fishing since I was born. This is better than working as a day laborer in Bangkok.”