NYT Reports That Senators Are Working On A Fiscal Cliff Deal — And Paul Krugman Is Already Furious

TBI ^ | 10-2-2012 | Joe Weisenthal

[blam]

NYT Reports That Senators Are Working On A Fiscal Cliff Deal — And Paul Krugman Is Already Furious

Joe Weisenthal
October 2, 2012, 4:47 AM

Wikimedia Commons

This sounds very hazy, but Jonathan Weisman of the New York Times says work has begun among some Senate leaders will hammer out a plan that would cut $4 trillion out of the deficit over 10 years, and avert the fiscal cliff/sequestration nightmare due to hit on January 1 of next year.

First, senators would come to an agreement on a deficit reduction target — likely to be around $4 trillion over 10 years — to be reached through revenue raised by an overhaul of the tax code, savings from changes to social programs like Medicare and Social Security, and cuts to federal programs. Once the framework is approved, lawmakers would vote on expedited instructions to relevant Congressional committees to draft the details over six months to a year.

If those efforts failed, another plan would take effect, probably a close derivative of the proposal by President Obama’s fiscal commission led by Erskine B. Bowles, the Clinton White House chief of staff, and former Senator Alan K. Simpson of Wyoming, a Republican. Those recommendations included changes to Social Security, broad cuts in federal programs and actions that would lower tax rates over all but eliminate or pare enough deductions and credits to yield as much as $2 trillion in additional revenue.

There are so many hurdles for something like this, including the tax issue, not to mention trying to craft something palatable to the House.

But at least it's worth noting that some form of the 'Grand Bargain' is being kicked around somewhere in Washington.

Meanwhile, Paul Krugman is already flipping out.

(snip)

[WildHighlander57]

Hmmm, not everything is a “waste”....

some of us worked in the factories designing and making things like F-14, F-15, F-18 radars, B-52 infrared sensors, stuff like that.....

and still work in the factory designing and making smaller versions of these.

Been doing this for 33 years, need 10 more to retire

[ridesthemiles]

Obama piled $6 Trillion upon us in less than 3 1/2 years......and these guys are talking about a $4 trillion reduction in 10 years!!!

This doesn’t make a lick of fiscal/financial sense to me.

[Southack]

The public always gets rolled by each DC crisis du jure. If a “deal” is in the making, it is just a way to put a pretty face on BOHICA.