Cantor drops out of Gang of Biden 

The Wall Street Journal‘s Janet Hook and Corey Boles have the scoop:

House Majority Leader Eric Cantor Thursday said he was pulling out of the bipartisan budget talks headed by Vice President Joe Biden for now because the group has reached an impasse over taxes that only President Barack Obama and Speaker John Boehner (R., Ohio) could resolve.

Still, Mr. Cantor remained optimistic about the prospects for a deal. He said the Biden group had already made significant progress and had tentatively identified more than $2 trillion in spending cuts over the next 10 years. But he said there could be no agreement on an overall package without breaking the impasse between Republicans’ refusal to accept any tax increase, and Democrats insistence that some tax hikes be part of the deal.

Cantor also seemed to confirm that there is agreement on cuts to entitlement programs:

Mr. Cantor said the $2 trillion in spending reductions identified include savings both from the discretionary and the mandatory side of the federal budget. … The majority leader wouldn’t go into specifics, but said that reductions had been broadly agreed to across the budget including in federal spending on health-care programs. He said that the group had yet to agree on a mechanism to control future spending, such as setting firm spending caps for example.

The Democrats at the table have been very firm that Social Security is off the table. So these "savings" from mandatory spending must be coming from Medicaid or Medicare. Only Obama could realistically sign off on cuts to these two hallowed liberal programs.

Cantor says the Gang of Biden accomplished a lot, but it seems that the biggest questions, tax hikes and entitlement cuts, are going to be decided exactly where everyone thought they would be: between Obama and Boehner.

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