U.S. Debt Deal FAQ
Posted on Aug 3, 2011
Still foggy on the basics of this week’s debt and deficit deal? The Guardian has published a no-nonsense guide explaining the meaning and function of the congressional “super committee,” the “trigger,” the “balanced budget amendment” and more, including the deal’s potential future. —ARK
What’s the ‘super committee’?
A 12-member congressional panel to meet in November and come up with a plan to reduce deficits by $1.2tn to $1.5tn over 10 years. It can consider tax or revenue increases. If it fails to produce a plan acceptable to Congress, the deal triggers steep, automatic cuts in spending of a similar size.
How does this trigger work?
The trigger is designed to encourage the committee to produce meaningful ways to cut the deficit. If it fails, across-the-board spending cuts in discretionary spending starting from fiscal year 2013 will be set in motion, with half coming from defence – a painful prospect for many Republicans. Medicaid and social security payments are protected, with limited cuts to Medicare programmes – painful for Democrats.
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