Sam Stein
http://www.huffingtonpost.com/2011/07/25/harry-reid-debt-ceiling_n_908596.htmlSenate Majority Leader Harry Reid's (D-Nev.) $2.7 trillion debt ceiling proposal will not include reforms to the benefit structure of entitlement programs, several Democratic sources confirmed on Monday.
The plan, which is being crafted as a last-minute attempt to break through the political impasse on a deficit reduction package, would instead lean heavily on cuts to discretionary spending. The package will also reportedly include roughly $1 trillion in savings that will come from the drawdown of the wars in Iraq and Afghanistan (which the Congressional Budget Office does score). Reid's office was notably hesitant to confirm that detail, cautioning reporters to wait until the final package is unveiled. That said, if entitlement programs remain more or less untouched in the plan, there would be few other areas from which to draw ten-year savings.
Word that Reid is taking entitlements of the table will come as welcomed news to Democrats who are still smarting from the idea that the party has gone from demanding a "clean" debt ceiling bill to willingly backing $2.7 trillion in cuts without measures to increase revenue. The Obama administration had offered to support an increase in Medicare's eligibility age, the means-testing of certain Medicare programs, cuts to Medicaid benefits and a restructuring of the payments of Social Security benefits as part of a grand bargain with Republicans. GOP leadership ultimately rejected that proposal over complaints that the president was insistent that additional tax revenues be added to the mix to round out the plan.
A top Democratic aide confirmed on Monday that none of those specific entitlement reforms will be included in the party's most current debt-ceiling proposal. As for cuts to Medicaid or Medicare suppliers -- namely hospitals and pharmaceutical companies -- that remains less clear. According to House Majority Leader Eric Cantor's (R-Va.) office, both parties agreed to $334 to $353 billion in health savings during talks organized by Vice President Joseph Biden. Those talks, which never resulted in a formal agreement, do serve as one pillar of the $2.7 trillion proposal that Reid has put forward. But one Democratic source, who has been plugged into negotiations, says that Medicaid, at the very least, will not be touched under the Reid plan.
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