The United States is on course to slash its budget deficit nearly in half next year. Closing the gap that quickly, which in Washington is referred to as going over a “fiscal cliff,” could easily trigger a recession.
“Unfortunately, for the last 10 days, with the House and Congress gone for the Thanksgiving recess … much progress hasn’t been made,” Dick Durbin, the No. 2 Senate Democrat, told ABC’s “This Week” program.
Serious negotiations are expected to resume this week. Democratic and Republican lawmakers have been trying to convince the public – and financial markets – that they are willing to compromise and can reach a deal before the end of the year.
Durbin indicated Democrats might accept a reform of the government’s Medicare health insurance program for the elderly that would make higher-income seniors pay more for their care.
Democrats traditionally oppose limiting Medicare benefits according to income, a practice known as “means testing.” Durbin said Medicaid, a public health insurance program for the poor, also could be overhauled.
But Durbin said Social Security, the federal government pension program, needs only small tweaks to ensure long-term solvency rather than major reforms.
A deadline looms over the talks. Without action by lawmakers and President Barack Obama, roughly $600 billion in tax increases and spending cuts will start to hit households and companies in early January.
via Reuters
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