During a closed-door session, Sen. Baucus extended the proposal to the debt reduction committee, which is charged with finding $1.2-1.5 trillion in savings by Thanksgiving under the new Budget Control Act. Failure to submit the recommended savings or failure by Congress to enact the recommendations by that time will result in across-the-board automatic cuts, including a 2 percent cut in Medicare payments.
Sen. Baucus’ proposal also includes other measures, such as $1.3 trillion in new taxes and $300 billion in investments to stimulate the economy. These ideas have already been rejected by GOP debt reduction committee members, who have adamantly fought against any new taxes and economic stimulation. Sen. Baucus’ plan was backed by a majority of other Democratic debt reduction committee members.
Specific details of Sen. Baucus’ proposal, particularly potential Medicare and Medicaid cuts, have not been disclosed due to the nature of the committee’s closed-door sessions.
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