Senate Democrats plan to vote Tuesday on Sen. Majority Leader Harry Reid's newly offered debt-ceiling plan that includes $1.2 trillion in spending reductions over 10 years.
The Reid plan explicitly exempts Medicare and Medicaid from any cuts, although it derives some of its “savings” from an expected decrease in spending by those two programs on fraudulent claims. The plan would put off any long-term debt-reduction deal and the next debt-ceiling expiration until after the 2012 elections.
“This proposal satisfies the Democrats' core principles by protecting Medicare, Medicaid and Social Security,” Reid said at a Monday news conference.
Reid said President Barack Obama supported his new plan.
The Senate approach is sharply different than the debt plan that Republicans said they plan to bring up for a vote this week in the House. That plan, according to a leaked document, also would derive $1.2 trillion in cuts but increase the debt ceiling only enough for a few months. It then would require Congress to finalize a longer-term debt agreement with an additional $1.6 trillion in deficit reductions over the next 10 years.
“The two-step framework that the speaker and I laid out to our members today is not perfect—as we've said for months, we would have much preferred to vote to increase the debt limit only once, but the president and his party continued to make demands which we cannot meet—namely tax increases,” House Majority Leader Eric Cantor (R-Va.) said in a written statement.