Obama's new budget includes about $800 billion in new revenue over ten years and $800 billion in spending cuts, not counting savings from chained-CPI, to replace the sequestration cuts. The chained-CPI method of inflation calculation, which reduces Social Security spending and also boosts revenue (by slowing the upward adjustment of income tax brackets for inflation), is included as a concession to Republicans demanding the Obama propose "entitlement cuts" (Obama cut $716 billion over ten years in Medicare spending in the ACA and last year proposed another $400 billion in federal Medicare spending reductions, but never mind). Chained-CPI, with Obama's offsets for low-income seniors, saves a projected $130 billion over ten years. Sargent, trying to scope out administration intentions in light of Obama's new budget, writes:
Senior administration officials who briefed a number of us late yesterday repeatedly insisted that the White House will not move any further in the GOP’s direction if Republicans try to pocket the entitlement cuts while refusing to make any concessions. The officials say that without new revenues, no deal is possible.And then, assessing the import of Obama's chained-CPI "concession" (which he had already put on the table, publicly, in December):
It’s welcome that the White House is vowing not to budge off its current offer, but only the White House can ensure that this promise holds over time.The White House has not vowed not to budge off its current offer. It has vowed not to deal if Republicans put no revenue on the table. As his been true since the 2011 negotiations, Republicans can clean Obama's clock by offering some revenue.
