(J. Scott Applewhite / Associated…)
A top Republican said Tuesday that as much as $150 billion in spending reductions has been identified as potential common ground between the White House and congressional negotiators seeking an agreement on deficit-reduction measures in exchange for raising the nation's debt limit.
“You first look at the things where there might be some overlap between our budgets and their budgets,” said Sen. Jon Kyl (R-Ariz.), the Senate Republicans’ chief negotiator in budget talks. He said that initially about $100 billion in cuts were identified, then subsequent areas of agreement were noted. “We’re discussing in the magnitude of $150 billion in cuts,.” he said
Finding possible agreement on $150 billion in budget cuts is a start, but far from the more than $2 trillion in budget reforms that would be needed over the next several years to meet House Speaker John A. Boehner’s demand that spending reductions be greater than the amount of additional borrowing authority needed to keep the country from default.
The nation hit its nearly $14.3-trillion debt limit this week, but Treasury Department officials have indicated that they can maneuver resources to avoid defaulting on the nation’s obligations until Aug. 2.
With the national debt accumulating at a rate of $125 billion a month, estimates are a $2-trillion increase would be needed to avoid hitting the statutory debt limit again until late 2012.
Kyl declined to discuss specific areas of agreement from the last meeting of congressional negotiators and Vice President Joe Biden, who has been leading the closed-door talks.
But areas of common ground between the president’s proposed 2012 budget and the House Republican-passed plan include possible reductions in agricultural supports, changes in federal employee pension plans and an expansion of the Federal Communication Commission’s spectrum authority.
Both sides have also indicated privately that changes to the Medicaid health program for low-income Americans, seniors and the disabled are also an area for consideration, though Kyl said healthcare reforms have not yet been addressed in the talks.
Tax policy remains a dividing line as Republicans insist that any savings generated from closing tax loopholes be used for tax reductions rather than deficit reduction.
Democrats have argued that new tax revenue could be used to close the deficit gap.
Senate Majority Leader Harry Reid (D-Nev.) said Tuesday that Democrats would push to include their proposal to end tax breaks for the big five oil companies as part of the talks. The legislation is being voted on Tuesday but is unlikely to advance in Congress.
Widespread agreement has emerged between Democrats and Republicans that $4 trillion in deficit reduction is needed over the next decade to begin to reduce the national debt from alarmingly high levels.
Talks between the congressional leaders and the administration have paused this week as the House is in recess, but they are likely to resume next week when both the House and Senate are in session.