On Deadline, No Sign of a Debt Deal

Talks between congressional leaders charged with coming up with a plan by Wednesday to cut the national deficit by $1.2 trillion have descended into squabbling and finger-pointing, suggesting that automatic cuts to domestic programs, Medicare and defense spending—rather than a mix of cuts and tax increases—are inevitable.

Republicans remain stubbornly opposed to raising taxes on the wealthiest Americans, while Democrats insist that a deal could be reached if Republicans would agree to allow the Bush tax cuts for the rich to expire. — ARK

The New York Times:

The testy exchanges — which dominated the Sunday talk shows — made clear that leaders in both parties now see the so-called sequester — a term meaning an automatic spending cut — as the most likely solution to reduce the federal deficit by $1.2 trillion over 10 years, instead of a negotiated package of spending reductions and tax increases, something they have been unable to achieve over the last 10 weeks.

… The focus increasingly is turning to how to perhaps change the mix of automated budget cuts before they take effect in January 2013, if no budget deal is reached this week.

The Congressional Budget Office has estimated that domestic programs would be cut by 7.8 percent, Medicare spending would fall by about 2 percent, while the biggest cut would be to defense programs, which would be reduced by about 10 percent.

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