Senate Democrats Offer $3 Trillion Debt Deal

Source: Lori Montgomery / The Washington Post

Senate Democrats are urging the debt-reduction supercommittee to pursue a far-reaching agreement to slice $3 trillion from the federal budget over the next decade through significant cuts to federal health programs, including Medicare, and as much as $1.3 trillion in new taxes.

At a closed-door meeting Tuesday, Sen. Max Baucus (D-Mont.) told his colleagues on the panel that they should pick up where President Obama and House Speaker John A. Boehner (R-Ohio) left off in negotiations this summer during a bitter battle to raise the federal debt limit, according to congressional aides in both parties familiar with the meeting. Obama and Boehner were discussing a plan that included provisions to raise taxes, raise the Medicare eligibility age and use a less generous measure of inflation to calculate Social Security benefits.

Baucus, the aides said, proposed that the committee look at slightly larger revenue increases. That idea faced immediate push-back from Republicans on the panel, who have consistently refused to consider raising revenue through any means other than economic growth.

Baucus’s proposal suggests a plan about equally divided between tax increases and spending cuts, including as much as $500 billion in fresh savings from health programs, such as Medicare and Medicaid. Aides said Baucus also urged his colleagues to approve Obama’s request for as much as $300 billion in fresh measures aimed at stimulating the economy, another idea Republicans have resisted.

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