What to Watch for in Deficit Talks
Policy + Politics

What to Watch for in Deficit Talks

Congressional negotiators from both parties are set to sit down Thursday afternoon for their latest meeting on deficit reduction with Vice President Biden. The huddle, which begins at 1 p.m. at the Capitol, marks the group’s fifth meeting. On the agenda: the budget process, discretionary spending and the contentious issue of revenue. Here are some things to keep an eye on as the talks convene.

Senate Finance Committee Chairman Max Baucus (D-Mont.), who along with Senate Appropriations Chairman Daniel Inouye (D-Hawaii) is one of two Senate Democrats tapped to attend the talks, will likely make the case for new revenue. Then the focus is likely to turn to discretionary spending, spending caps and other enforcement mechanisms.

Republicans are seeking something along the lines of the CAP Act, a proposal by Sen. Bob Corker (R-Tenn.) that eventually caps all government spending – including defense and entitlements – at 20.6 percent of gross domestic product. (The current federal spending level is at more than 24 percent of GDP.)

Democrats, including the White House, are looking for a cap on the size of the federal deficit, rather than a cap on spending. Republicans oppose this idea, arguing that it would allow room for revenue increases.

The participants in Thursday’s meeting – who include Biden, Inouye, Baucus, House Majority Leader Eric Cantor (R-Va.), Senate Minority Whip Jon Kyl (R-Ariz.), Rep. Chris Van Hollen (D-Md.) and House Assistant Minority Leader James Clyburn (D-S.C.) – will continue down the list of potential items involved in deficit reduction. The negotiators have yet to focus extensively on Medicare, one of the most contentious issues in the debate.

Read more at The Washington Post.