President Obama has doubled down on a go-big-or-go-home approach to deficit reduction. You want $2 trillion in savings? he's telling congressional negotiators. I raise you to $4 trillion.
Brian Beutler from TPM has news that a deal could be closer than we (well, I) think:
President Obama and leaders on Capitol Hill have committed themselves to moving ahead with a larger deficit reduction deal than negotiators once thought possible in the weeks ahead. In sum, Obama and House Speaker John Boehner (R-OH), along with other GOP and Dem leaders are now aiming for a 10-year goal of $4 trillion in deficit reduction, which would include defined cuts in entitlement, defense, and domestic discretionary spending. The cuts would amount to about 75 percent of the overall savings, and the biggest question now is whether the GOP will truly give ground on taxes -- in specific ways, that produce real revenue. The alternative is that those changes will remain ill-defined in ways that fail to guarantee deficit reduction, and convince already-uneasy Democrats to throw up their hands.
Beyond my general skepticism that a renegade Congress can reach a historic deficit reduction deal in four weeks, here are my three takes:
(1) It still comes down to taxes. Democrats want more revenue. Republicans won't raise rates. The only place to go is so-called loopholes. The tax code has half as much holes and cheese these days, with $1 trillion in tax exceptions to $2 trillion in real revenue. Most analysts expect we could get $100 billion per year over the next decade in new revenue.