In Congress, deal-making mood may emerge from budget issues

The New York Times reports that, as lawmakers on Capitol Hill face "so many potentially calamitous tax and budget issues," necessity may bring consensus.  

The New York Times: Weighing The Effect Of An Exit Of Centrists
But Congress is facing so many potentially calamitous tax and budget issues that another theory is brewing: a combination of Democrats, once averse to changes to social welfare programs, and senior Republicans may form some sort of new deal-making consensus through sheer necessity to avoid large tax increases and significant military cuts. "If Republicans think by embracing the Tea Party it is a loser politically," said Senator Charles E. Schumer of New York, the No. 3 Democrat, "it may strengthen the hands of the mainstream conservatives" to make deals with the 10 or so moderate Democrats in the Senate who are interested in reforming Medicare and other programs (Steinhauer, 10/8).

Meanwhile, in related news, states consider cost-containment strategies as congressional leaders wrestle with the prospects for a long-term deal that could include Medicare and Medicaid --

Politico Pro: States Taking New Look At Cost Containment Strategies
Will states buckling under surging health care costs be scared straight by the fiscal cliff? Any long-term deal to head off fiscal disaster is likely to feature efforts to control the growth of Medicare and Medicaid, and in some scenarios, states could be left without billions of dollars in federal support. As a result, some experts say states will begin warming to proposals aimed at slowing health care costs within their borders, if only to get ahead of a likely gut-punch from Washington. "The prospect of what the federal government is going to do on Medicare and Medicaid is scaring the heck out of people," said Harvard University economist David Cutler. "They think, 'They're just going to kill us and they're going to do it in some awful way. One way or the other, we are going to get slammed.' What they don't want is what Washington always gives them, which is just payment cuts." Cutler and a group of mostly left-leaning health care experts recommended last month that states consider setting "global targets" to help pressure their "fragmented health care systems" to reduce costs (Cheney, 10/8).