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Democrats Try to Band Together on Entitlements Ahead of Fiscal Cliff Talks

Senate Democrats are keeping their proposals for curbing the cost of social programs under wraps in order to avoid a split in their ranks as talks on the fiscal cliff begin Friday.

In order to preserve their leverage, Democratic leaders want to hold off as long as possible specific discussions of how they would trim the cost of entitlements.

“They are negotiating from a stronger position without doing that,” a Senate Democratic aide said Thursday.

Republicans have stressed that they will insist on cuts in domestic spending, what some call entitlement reform, as part of any agreement that would include more tax revenue.

Some liberals in the caucus are urging a high bar for any agreement that includes significant spending cuts. Sen. Jay Rockefeller, D-W.Va., is crafting a letter with Sen. Tom Harkin, D-Iowa, urging President Barack Obama to strike a fiscal cliff deal only if there is a 1-to-1 ratio of tax increases to spending cuts. Obama has previously signaled he would seek an agreement with $2.50 in spending cuts for every new dollar in revenue.

Senate Majority Leader Harry Reid, D-Nev., has discouraged the lawmakers from sending the letter because it would give the impression that Democrats were divided and would take the focus off of Republicans, who are under pressure to allow for a tax rate hike.

As many as 13 Democratic senators, including Rockefeller and Harkin, have signed the letter, a source said, pointing to a possible fracturing among Democrats over spending in areas such as Medicare.

Although Obama has said further changes need to be made to Medicare to control its costs, the Rockefeller-Harkin letter virtually rules out any extensive modifications to entitlement programs.

“We urge you to reject changes to Medicare, Medicaid and Social Security that would cut benefits, shift costs to states, alter the structure of these critical programs, or force vulnerable populations to bear the burden of deficit reduction efforts,” the letter says. “Each of these programs is a vital lifeline to the middle class. Social Security does not contribute to the federal deficit, and the Trust Fund is solvent until 2033. Medicare and Medicaid are already very efficient.”

If Democrats are unwilling to agree on enough changes to entitlement programs to satisfy Republicans, it is all but impossible that the GOP would agree to Democratic demands on taxes as part of a plan to avoid across-the-board spending cuts and a wholesale expiration of tax cuts.

Senate Finance Chairman Max Baucus, D-Mont., declined to say Thursday whether he would entertain raising the Medicare retirement age or means testing of Medicare, as he left a closed door meeting of the committee.

Baucus, who will play a major role in the fiscal cliff negotiations, said the committee had a “very constructive meeting” discussing various ideas for averting the fiscal cliff. “We’re at the point where a lot of views were aired, but not dogmatically,” Baucus said of the bipartisan meeting. “It’s a very open discussion. The goal is to get the committee to reach an agreement.”

Sen. Debbie Stabenow, D-Mich., who sits on the Finance and Budget committees, declined to say whether she would accept changes to Medicare and Medicaid. “I’m not going to get into that,” she said. “We’ve already begun that in health reform. We’ve already begun to bring down costs, and there’s certainly more we can do.”

Still, some liberals in the caucus are underscoring their opposition to cuts to entitlement programs as fiscal cliff negotiations begin in earnest, and have signaled they have no problem engaging in a pressure campaign directed at the president.

“We must not balance the budget on the backs of the elderly, the sick, the children, or the poor,” Sen. Bernard Sanders, I-Vt, said. “We’re going to send a loud message to the leadership in the House, in the Senate and President Obama: Do not cut Social Security, do not cut Medicare, do not cut Medicaid.”

Joined by Harkin, Sen. Sheldon Whitehouse, D-R.I., and several House Democrats, Sanders spoke Thursday in a Senate committee room before a boisterous crowd of more than 100 people, including some wearing shirts with the words, “Tax the Rich.”

White House spokesman Jay Carney reiterated Thursday that Obama is taking nothing off the table.

“Now, the president is not wedded to every detail in his plan,” Carney told reporters. “He has made that clear. He is willing and ready to compromise, and he welcomes the tone and content of the statements that many Republican leaders have said about their willingness to include revenues and to compromise.”

Such talk raises fears among some Democrats that Obama may give up prized programs in his search for a “grand bargain” with Speaker John A. Boehner of Ohio.

Sen. Ron Wyden cautioned that negotiations are at the “early, kind of sparring” stages, and that the parties might yet come to an agreement to curb the growing cost of Medicare.

The key, the Oregon Democrat said, is to “intertwine policy judgments with the numbers.” Democrats, for example, must know that the Medicare guarantee and traditional Medicare are protected, he said. Then, he said, questions over the eligibility age for Medicare could be addressed in detail, with allowances made for retirees from different fields, for instance.

“You’ve got to make some of these policy judgments in order to have a real process of bipartisan agreement on the numbers,” Wyden said. “If you just go walk into a meeting and say it’s going to be this number and that number, it get pretty challenging in a hurry.”

Humberto Sanchez contributed to this report.

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