The plan by Senate Democrats would cut spending by $2.7 trillion over the next decade, while increasing the government's ability to borrow by $2.4 trillion.
- Extends borrowing authority through 2012.
- Cuts $1.2 trillion from discretionary programs. These are the day-to-day operating budgets, grants and programs of government agencies, such as the Interior, Education Justice and Defense departments and the Environmental Protection Agency.
- Claims savings of $1 trillion from winding down the wars in Iraq and Afghanistan.
- Saves $400 billion from lower interest payments.
- Cuts $100 billion from mandatory programs, including agriculture, Fannie Mae and Freddie Mac. Includes savings from reducing waste, fraud and abuse.
- Creates a bipartisan legislative committee to recommend future cuts, with a guarantee that if the panel can agree on a plan, it will receive a vote in Congress.
The plan by House Republicans would reduce spending by $1.2 trillion over 10 years, while increasing the government's ability to borrow by about $1 trillion.
- Extends borrowing authority until about February.
- All cuts would come from the day-to-day operating budgets of government agencies, known as discretionary programs.
- Imposes caps on future spending.
- Requires the House and Senate to vote on - but not necessarily pass - a balanced budget constitutional amendment by the end of 2011.
- Creates a bipartisan legislative committee to recommend $1.8 trillion in future cuts to programs such as Medicare, Medicaid and Social Security, in exchange for increasing the government's ability to borrow an additional $1.6 trillion.