On Friday the Republican leadership walked away from yet another deficit reduction proposal from President Barack Obama, throwing the negotiations over raising the debt ceiling into chaos. If Congress doesn’t raise the ceiling by August 2 there could be extremely dire consequences for everyone from homeowners to states to social security recipients to small business owners. In order to avoid those consequences the president is willing to agree to a deal that is actually much more conservative than any of the other bipartisan plans offered recently.
The infographic above shows that the president’s latest offer to House Speaker John Boehner (R-OH) is heavily titled toward spending cuts. In fact, the president’s offer contained about $1 trillion less revenue than the recent proposal from the so-called Gang of Six, a group that includes three Republican senators and three Democratic senators. It also represents significant movement from the president’s original debt reduction framework, which itself was already more conservative than the recommendations from the chairs of the debt commission (Erskine Bowles and Alan Simpson) last December.
Unfortunately the Republican leadership still turned the president down despite his willingness to offer cuts to programs Democrats traditionally defend and to agree to much less revenue than all other bipartisan deals.
Note: The amount of deficit reduction in each plan shown here was derived by comparing the plan to a baseline that approximates the effects of continuing current policies. That means extending all the Bush tax cuts, indexing the alternative minimum tax to inflation, and preventing scheduled but never implemented cuts to Medicare doctors. The baseline also adjusts defense spending to account for a projected drawdown in troops deployed for overseas military operations.