President Obama is an overachiever. Or ... something. He proposed a mere $2 trillion in cuts during previous budget negotiations, but the White House now says the president will look for $3 trillion to $4 trillion in cuts over the next ten years. The new target comes after a private meeting with House Speaker John Boehner, who reportedly agreed to $1 trillion worth of new tax revenues — in exchange for Obama putting Social Security, Medicaid, and Medicare (previously untouchable) on the table. It's unclear exactly how those programs would be trimmed, but cost-of-living adjustments have been bandied about in previous negotiations.
The Obama-Boehner meeting has congressional Democrats (already concerned that Obama would cave too easily to Republican demands) a little worried. Any cuts to those legacy Great Society programs won't be well received in liberal quarters — even the mention of Social Security in the same sentence as "cuts" gets blood pressure elevated on the left. In addition to the practical consequences of such a deal, it's not great political theater for the Democrats heading into an election year: It's a bit harder to argue that the GOP is coming for Medicare when the president opened the door.
Meanwhile, Boehner's tax concessions, which probably involve tightening tax breaks for oil and gas companies and owners of corporate jets, aren't quite as close to the bone — though Congress would have to enact additional, broader changes to the tax code to reach that $1 trillion goal.
The debt-ceiling debate adds more than a little urgency to the negotiations. The debt ceiling expires on August 2, and as Felix Salmon writes, "No responsible legislator would risk letting it pass. Beyond that date is uncharted territory: Here Be Dragons stuff." The Treasury Department is trying to figure out how they might slay some of those dragons (and, by the way, prevent "financial meltdown") if the deadline arrives without a deal. They've looked into whether the government could delay or prioritize payments, and, intriguingly, whether the New York Fed could broker a deal on the Treasury's behalf to raise its borrowing cap in global markets.
Salmon thinks there will be a move to declare the limit unconstitutional under the Fourteenth Amendment for sheerly practical reasons. It might be impossible to reprogram government computers to stop sending out checks to Social Security, $49 billion worth on August 3, "[n]ot to mention that no president ever wants to be the person who stiffed America’s seniors on their guaranteed monthly income."
Well, unless it's part of a budget deal.