This shouldn’t surprise anyone after the events of this summer, but the Super Committee is reportedly deadlocked over whether its plan to cut $1.2 trillion from the federal deficit should include tax cuts.
Democrats presented the committee with a plan to cut the deficit by nearly $3 trillion over 10 years, of which 50 per cent would come from revenue increases. In exchange, they offered to accept $400 billion in cuts to Medicare, including $200 billion in cuts to benefits.
But Republicans are standing by their pledge not to accept any tax increases coming out of the committee — taking the larger deal off the table, and jeopardizing the lawmakers’ chances of reaching an agreement at all.
One Republican aide told CNN that the committee is “deadlocked” over the issue — with just weeks left to reach a deal.
The committee must vote on its recommendations before Thanksgiving — and the Congressional Budget Office must “score” the plan before then, which could take weeks. Congressional sources say if a deal is not reached in the committee by next week, they won’t likely meet the statutory deadline.
Standard and Poor’s hinted today that such an outcome could precipitate another downgrade, and the other ratings agencies may not be far behind.
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