WASHINGTON (AP) -- Leaders of a bipartisan "Gang of Six" senators said Tuesday that they're nearing agreement on a major plan to cut the deficit by more than $4 trillion over the coming decade in what could be a bold entry into a debate on the deficit long bogged-down by bitter partisanship.
The Gang of Six plan is separate from a politically freighted effort to lift the nation's borrowing cap and avoid a first-ever default on U.S. obligations. President Barack Obama and Capitol Hill Republicans, however, have failed to reach an accord on what kind of spending cuts to pair with any increase in the borrowing cap as the government teeters toward a possible default in two weeks.
The group's effort was sealed after Oklahoma Republican Tom Coburn rejoined the group after winning concessions on additional cuts to costly federal health care programs. Coburn left the group in May, which dealt it a big setback and delayed an agreement since the two other GOP members of the group - Mike Crapo of Idaho and Saxby Chambliss of Georgia - appeared reluctant to release the plan without Coburn's backing as well.
The group has been laboring for months in an up-and-down effort to reach an agreement that largely mirrors the work of President Barack Obama's fiscal panel, which proposed $4 trillion in cuts over a decade. The fiscal commission plan won positive reviews from many lawmakers but its plan failed to win a vote in Congress.
The Gang of Six plan calls for an immediate $500 billion "down payment" on cutting the deficit as the starting point toward cuts of more than $4 trillion over the coming decade that would be finalized in a second piece of legislation.
The idea is that a bipartisan plan would gain critical mass in the Senate, powered by the endorsement of conservatives like Coburn and liberals like Dick Durbin of Illinois, the No. 2 Democrat in the Senate and a member of the group.
Both Republican and Democratic leaders, however, remain wary of the effort, since it would raise revenues by about $1 trillion over 10 years and cut popular benefit programs like Medicare and Medicaid.
Like the deficit commission, the Senate group's plan calls for a fundamental overhaul of the tax code that would slash special tax preferences and deductions as a way to lower tax rates - along the lines of the 1986 tax reform measure signed into law by President Ronald Reagan. In addition to skimming some of the revenue to reduce the deficit, advocates of the plan say it would spur the economy and fill federal coffers further because of such growth.
The measure also calls for tight "caps" on the daily operating budgets of federal agencies, as well as a major overhaul of programs like Medicare, Social Security, and farm subsidies. The details of the changes would be left to congressional committees to draw up.