Exclusive: Democrats seek up to $3 trillion in budget savings

Reuters News
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Posted: Oct 26, 2011 11:49 AM
Exclusive: Democrats seek up to $3 trillion in budget savings

WASHINGTON (Reuters) - Democrats are proposing $2.5 trillion to $3 trillion in measures to reduce the budget deficit, including revenue increases and significant cuts to Medicare, congressional aides told Reuters.

The plan was unveiled on Tuesday at a closed-door meeting of a special 12-member congressional panel, the so-called "super committee", that is tasked with finding at least $1.2 trillion in deficit reduction over 10 years.

It was the first formal proposal by Democrats on the committee and is aimed at galvanizing talks that are quickly running up against a November 23 deadline.

The congressional aides did not say why Democrats were proposing such a big deal, but Democratic congressional leaders have repeatedly called on the committee to go beyond its mandate to fix the country's fiscal mess.

According to congressional sources, the plan includes a roughly equal mix of spending cuts and revenue increases; between $200 billion and $300 billion in new economic stimulus spending that would be paid for with lower interest payments from reducing deficits; and around $400 billion in Medicare savings, with half coming in benefit cuts and the other half in cuts to healthcare providers.

(Editing by Sandra Maler)