Obama-GOP deal on deficit/debt—Likely components

Bob Cusack at The Hill has a recent post on what might be included in any Obama/GOP deal to cut the deficit and raise the debt ceiling.  Here is a brief rundown according to Cusack.  Read Cusack’s original post here for source of opposition to these proposals and why they may not be feasible.

http://thehill.com/homenews/news/170539-a-rundown-of-what-could-be-put-in-the-obama-gop-debt-deal

Here are items that might end up in the final deal, if one is reached:

Deal would call for cutting deficit by $4 trillion over 10 years.

• Medicare may get power to negotiate price of drugs.
• Means testing may become part of Medicare, with lower benefits for wealthy beneficiaries.
• Medicaid cuts are likely along with a possible change to block-grant program—The real fight will be over keeping cuts from completely gutting the program, not preventing cuts totally.
• Major changes are likely with Social Security, particularly a switched to the “chained” CPI for calculating Cost-of-Living increases (COLA).
• A number of “special interest” tax breaks such as those on ethanol, oil and gas, corporate jets and yachts may be eliminated.
• Some kind of increase in “user fees” for government services are likely.
• Some effort may be made to address the alternative minimum tax (AMT) issue.
• The corporate tax rate may be lowered.
• Defense spending will likely be cut.
• Farm subsidies may be cut drastically.
• Financial aid for colleges may be cut.
• Pensions for federal workers may be cut.
• Mortgage deduction for second homes may be eliminated.
• A repatriation proposal to allow companies to bring foreign-based income back to the U.S. at a reduced tax rate may be included.
• President may be required to submit a budget every other year at the beginning of the first session of Congress.
• Eliminating Bush tax cuts probably WILL NOT be included.
• Balanced Budget Amendment probably WILL NOT be included since it could not pass anyway.