Corker bill would trade $900B in entitlement cuts for hike to debt ceiling

Sen. Bob Corker (R-Tenn.) said Wednesday he'd offer legislation to trade billions in entitlement savings for a hike in the debt ceiling. 

Corker said his bill would include $900 billion to $1 trillion in savings from Medicare and Medicaid, with an equivalent, dollar-for-dollar hike to the debt ceiling.

Corker offered no details on how he would find his entitlement savings. 

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“Let’s get busy, let’s not wait till the last minute, let’s not do it through closed-door meetings,” Corker said. “For every dollar we raise the debt ceiling, we reduce spending by one dollar.”

Entitlement reforms and a hike to the debt ceiling are central in talks between President Obama and Speaker John Boehner (R-Ohio) on a fiscal deal. 

But Corker said he didn't expect the two would reach an agreement by the end of 2012, when Bush-era tax rates are set to expire. 

He said deficit reduction and entitlement reforms likely would have to wait for action until February, when the nation will hit its debt limit. That event would force the administration to agree to concessions on entitlements to win approval from Congress for a hike to the debt ceiling. 

“I woke up this morning with almost a eureka moment that if they're not going to, I’ll get us started,” the Tennessee Republican said on the floor Wednesday. “What I plan to do over the next couple of days is offer legislation that would reform Medicare and Medicaid by $900 billion ... and offer it to how we raise the debt ceiling.”

The lawmaker said he wants to move the legislation through regular order, allowing committee input and amendments. He said his plan would “save this nation from catastrophe” and that solvency is the greatest threat to America right now, and that lawmakers should start working now so that a last-minute deal isn't pushed through.

On taxes, Corker said he thinks House Republicans will cave on passing tax-rate extensions for those making less than $250,000 a year while allowing rates on income above $250,000 to rise. 

“I know that at some point both chambers will come to the rescue of the 98 percent of people who are middle income. ... That alone would move us beyond this cliff at the end of the year,” he said. 

In debt talks with Boehner in 2011, Obama agreed to significant entitlement reforms that included raising the eligibility age for Medicare. He has taken a tougher line in the current talks, though he has not ruled out such changes. 

Republicans see entitlements are the real drivers of the deficit and are pressing to include changes in a deal. Obama would like to get a hike to the debt ceilling as part of the current talks. 

This story was updated at 12:48 p.m.