Biden-led group agrees on $200 billion in savings

WASHINGTON: A bipartisan group of six Senate and House lawmakers, led by Vice President Joe Biden, has found common ground on at least $200 billion in cuts by focusing on mandatory federal spending, such as agriculture subsidies, outside of politically sensitive entitlement programs like Medicare, according to people close to the negotiations.

The negotiators are moving toward a package of immediate spending cuts and deficit-cutting benchmarks -- intended to reassure US investors and the bond market -- as hopes faded this week for a grand bargain sought by a separate group of six senators to reduce the nation's debt through revisions in entitlement programs and the tax code.

"You need to walk before you run," said Maryland Representative Chris Van Hollen, the top Democrat on the House Budget Committee and a member of Biden's group, which reconvenes next week. "We have not engaged on the clearly politically nuclear issues yet."

The narrower focus of the Biden talks stands in contrast to the work done by the so-called Gang of Six, led by Senators Mark Warner of Virginia and Saxby Chambliss of Georgia, that hit an impasse as they sought an agreement to reach $4 trillion in debt reduction over 10 years by trimming defense spending and entitlement-program benefits and raising revenue by closing tax loopholes.

The $200 billion would not satisfy Republican demands for cuts equal to any increase in the U.S. debt ceiling and are a starting point for future negotiations.