NYT Reports That Senators Are Working On A Fiscal Cliff Deal — And Paul Krugman Is Already Furious [View all]

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http://www.businessinsider.com/report-of-senate-fiscal-cliff-deal-2012-10

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This sounds very hazy, but Jonathan Weisman of the New York Times says work has begun among some Senate leaders will hammer out a plan that would cut $4 trillion out of the deficit over 10 years, and avert the fiscal cliff/sequestration nightmare due to hit on January 1 of next year.

First, senators would come to an agreement on a deficit reduction target — likely to be around $4 trillion over 10 years — to be reached through revenue raised by an overhaul of the tax code, savings from changes to social programs like Medicare and Social Security, and cuts to federal programs. Once the framework is approved, lawmakers would vote on expedited instructions to relevant Congressional committees to draft the details over six months to a year.

If those efforts failed, another plan would take effect, probably a close derivative of the proposal by President Obama’s fiscal commission led by Erskine B. Bowles, the Clinton White House chief of staff, and former Senator Alan K. Simpson of Wyoming, a Republican. Those recommendations included changes to Social Security, broad cuts in federal programs and actions that would lower tax rates over all but eliminate or pare enough deductions and credits to yield as much as $2 trillion in additional revenue.
There are so many hurdles for something like this, including the tax issue, not to mention trying to craft something palatable to the House.


Read more: http://www.businessinsider.com/report-of-senate-fiscal-cliff-deal-2012-10#ixzz289NIXfSu