Key points of US debt deal

PRESIDENT Barack Obama announced on Sunday that Republican and Democratic leaders have greed on a last-ditch deal to raise the US borrowing limit and avoid a catastrophic default, and urged lawmakers to "do the right thing" and approve the agreement.

Here is a summary of the deal, based on documents provided by both parties, as well as interviews with lawmakers and aides:

• The deal will allow Obama to raise the debt ceiling by at least $2.1 trillion in three steps.
  

Congress will have the chance to register its disapproval on two of these, but will not be able to block them unless it musters a two-thirds vote in both the House and the Senate - an unlikely prospect.

• It envisions spending cuts of roughly $2.4 trillion over 10 years, which Congress will approve in two steps - an initial $917bn when the deal passes Congress, and another $1.5 trillion by the end of the year.
  

• The first group of spending cuts will apply to discretionary programmes Congress approves annually, covering everything from the military to food inspection.
  

• Those programmes will be capped each year for 10 years. The caps will be relatively modest at first to avoid stifling the shaky economy - spending for the fiscal year that begins on October 1 will only be $6bn below the current level of $1.049 trillion.
  

The caps will have a greater impact in later years, when it is hoped that the economy will have recovered.

• About $350bn of the $917bn total will come from defence and other security programmes which now account for more than half of all discretionary spending. Republicans are resisting this idea and it is one of the few areas of dispute left.
  

• Automatic across-the-board spending cuts will kick in if Congress does not observe the caps in coming years.

• A 12-member congressional committee, made up equally of Republicans and Democrats from each chamber, is to be tasked with finding a further $1.5 trillion in budget savings.
  

• That committee could find savings from an overhaul of the tax code and restructuring benefit programmes like the Medicare elderly health programme - the politically risky decisions that lawmakers have not been able to agree on so far.
  

• The committee wil have to complete its work by November 23. Congress will have an up-or-down vote, with no modifications, on the committee's recommendations by December 23.
  

• If the committee cannot agree on at least $1.2 trillion in savings, or Congress rejects its findings, automatic spending cuts totalling that amount will kick in starting in 2013.

• Those cuts will fall equally on domestic and military programmes. Medicare will face automatic cuts as well, but they will be capped and fall entirely on medical providers. Social security, Medicaid, federal employee pay and benefits for veterans and the poor will be exempt.
  

• The plan also calls for both the House and the Senate to vote on a balanced budget amendment to the constitution by the end of the year. This measure is not likely to receive the two-thirds vote in each chamber needed for passage, but its inclusion will make it easier for conservatives to back the overall deal.