Republicans and Democrats remain far apart on how much tax hikes should contribute to deficit reduction. The deadline for the super committee to reach a deal is next Wednesday.
The bipartisan deficit 'super committee' is charged with finding $1.5 trillion in savings over 10 years. Can it find $450 billion more to fund Obama's jobs plan? Can it find $4 trillion? More?
The task of reining in the national debt lies in the hands of a super committee of 12, which gets down to business now that Congress is returning from its summer break.
Added to the political question of whether either one of the competing debt-limit plans can pass Congress is a practical question from the nonpartisan CBO: How much will they cut the deficit?
The proposal by the 'Gang of Six' senators Tuesday draws on ideas from the deficit commission. The middle-of-the-road plan will have to overcome partisan concerns and a lack of time.
Debt ceiling talks could result in a $4 trillion 'grand bargain,' or a smaller $2 trillion deal. Most economist say the bigger deal would be more helpful – and send a positive message to markets.
Ben Bernanke, head of the Federal Reserve, suggested Wednesday that lawmakers should instead focus on cutting the deficit over the medium to long term, in light of the slow recovery.
Fed chief Bernanke avoids taking a position on taxes while telling Congress it must act 'in a timely manner' to reduce the deficit. Failing to raise the debt limit, he says, would be a costly mistake.