There is no deal yet, but the ideas under consideration include reductions in spending on the big three entitlement programs: Social Security, Medicare, and Medicaid. That would be a huge concession for Democrats. In return, Republicans would agree to close some big tax loopholes, reducing some deductions and other so-called spending in the tax code as part of a tax reform deal that would also lower corporate tax rates. The net effect of that tax reform plan would be an increase in tax revenue.
As one senior administration official told me, "We need to do something unthinkable on entitlements. They need to do something unthinkable on taxes."
Another White House official acknowledged that Democrats won’t like the proposed reductions in Social Security and Medicare (an understatement), but that the changes would be modest compared to what Republicans have proposed in the Paul Ryan budget plan.