Tennessee Sen. Bob Corker is circulating a 10-year, $4.5 trillion plan loaded with controversial proposals, including a less generous inflation adjustment for Social Security, and a gradual increase in the regular Social Security retirement age to 68 and the Medicare eligibility age to 67.
Corker's plan also includes $749 billion in higher tax revenue claimed by capping itemized deductions at $50,000, a proposal that hits wealthier taxpayers the hardest.
Corker has yet to attract any Democrats in support. But he's a rarity on Capitol Hill in that he's offering specific spending cuts and tax increases instead of vaguely-worded bromides about how to tackle the country's deficit woes.
Corker offered a broad outline of the 242-page measure on the editorial page of Monday's Washington Post. A more detailed summary circulating on Capitol Hill contains a fuller description, including higher Medicare premiums for upper-income earners and new revenue from Medicare co-payments and deductibles.
Federal workers would get hit with higher contributions to their pensions and would receive an $11,000 voucher payment to finance their family's health insurance, saving taxpayers about $7 billion a year.
The fiscal cliff is a one-two punch of automatic cuts to the Pentagon and domestic programs—the punishment for the failure last year of a deficit supercommittee to craft a budget deal. Economists warn it could send the United States back into a recession, and high-level talks between the White House and top Republicans like House Speaker John Boehner, R-Ohio, continue in hopes of meeting a year-end deadline to avoid the cliff.
Corker's plan is a longshot. For starters, he rejects the idea of settling for a "down payment" on the deficit that would be used to punt the big decisions on the budget to next year, even though that's the recommendation of Boehner. And his plan is tilted to painful choices on Social Security and Medicare that Democrats are unlikely to embrace.
"Kicking the can down the road—setting up a process for token deficit reduction today with the promise of more reforms later—is misguided and irresponsible and shows a total lack of courage," Corker says.
The White House insists that instead of limiting deductions, any budget solution must include higher tax rates on upper-income earners.
"Math tells us that you can't get the kind of balanced approach that you need without having rates be part of the equation," White House Press Secretary Jay Carney said Monday. "We haven't seen a proposal that achieves that, a realistic proposal that achieves that."