It calls for between $200 billion and $300 billion in new economic stimulus spending that would be paid for with lower interest payments from reducing deficits.
It also seeks around $400 billion in Medicare savings, with half coming in benefit cuts and the other half in cuts to healthcare providers. Details of that proposal were scant but tackling the popular Medicare program is always politically risky for politicians.
It is unlikely this specific deal being offered by the Democrats on the committee will be accepted by Republicans, because it calls for tax increases and more stimulus, but it still puts our social safety net in danger. It is another instance of the Democratic party steadily moving towards the official position of saying Medicare benefits can and should be cut.
As we have seen time and time again, the Obama administration and Congressional Democrats offer conservative leaning ideas to sweeten a compromise. The Congressional Republicans reject the compromise but then demand that only the GOP ideas that “even Obama supports” are part of a new bill.
While this latest Democratic offer is most likely doomed, it may be an attempt to make themselves appear to be the only “reasonable” party that is willing to compromise. But the real effect will be to move the whole debate farther rightward.