Tough decisions on taxes, SS loom

From CCN Money:

Washington has a compromise problem. And now, lawmakers face a seemingly impossible task — find a way to institute reforms that have eluded policymakers, all while markets and rating agencies watch with rapt attention.

After risking default, the nation’s lawmakers agreed last week on a plan to raise the debt ceiling.

The deal slashed spending. But it included no tax hikes and no entitlement reforms — items that virtually every budget expert says are needed.

Those tough choices were kicked down to a 12-member bipartisan super committee tasked with finding another $1.5 trillion in budget savings.

“What we need to do now is combine those spending cuts with two additional steps: tax reform that will ask those who can afford it to pay their fair share and modest adjustments to health care programs like Medicare,” President Obama said this week.

That sounds easy enough — but it will actually require mountains of political will and lawmakers who are willing to risk their jobs.

“There is no question about the political backlash they will face,” said Julian Zelizer, a professor of history and public affairs at Princeton University. “There are a lot of reasons to be skeptical.”