With less than a month to make a deal, there's a trillion dollar gap between the deficit-reduction plans proposed by Democrats and Republicans on the Super Committee. Late last night, the committee's Republicans gave Democrats a first glimpse of their plan, responding to a $3 trillion plan proposed by Democrats earlier in the day. This morning, different aspects of the GOP deal were leaked to The Wall Street Journal and Politico. Here's how they compare to the Democrats' plan:
Total deficit reduction While Democrats decided to go big, with 10-year savings of $2.5-$3 trillion through entitlement cuts and tax increases, the Republicans balked, preferring a $2 trillion plan, raising much less in revenue and tax increases.
Social Security In a rare area of agreement, the respective plans leaked to The Wall Street Journal show both plans want to find savings in Social Security via the way cost-of-living adjustments are calculated. As the WSJ notes, "That seemingly technical proposal is very controversial because it would slow the growth of Social Security and other benefits. It also would raise revenue over time because it affects the formula for adjusting tax brackets for inflation."
Benefits and health care savings The GOP plan leaked to Politico shows Republicans want to cut $150 billion more than Democrats in these areas (a total of $400 billion). These cuts don't include Medicare and Medicaid (we'll get to that later) but they likely include cuts to food stamps and federal nutrition programs, according to Politico.
Discretionary spending Yesterday, it was unclear what Democrats wanted to cut from defense. Now it appears some of those cuts will take place in discretionary spending, according to Politico. "Republicans list about $250 billion in savings here attributed generally to reducing personnel costs. Democrats appear willing to ask for $400 billion in savings — but want half of it to come from defense, a sore point for the GOP."
Medicare and Medicaid The GOP plan has $500 billion in Medicare cuts and $185 in Medicaid cuts, according to the WSJ. Politico says most of those savings will come from "high patient co-pays" or "increased Part B premiums charged to higher income beneficiaries." Democrats reportedly accept some of these changes but not all. According to Reuters, their plan calls for $400 billion in Medicare savings.
Stimulus Democrats want $300 billion to spend on infrastructure and other programs to create jobs or promote economic growth, reports the WSJ. That's slightly higher than the report from Reuters yesterday which pegged the number between $200 billion and $300 billion. Republicans oppose this measure.
Tax revenue While Democrats want to find $1 trillion in new revenue, the GOP plan is much more modest, reports Politico. The Republican plan depends on "changes in the CPI [that] would again yield some revenue, but the greater share of the tax revenue here — about $200 billion — is attributed to the impact of future tax reform spurring economic growth.'