Today begins the bipartisan, bicameral deficit reduction talks led by Joe Biden. Being a semi-public meeting, it’s a sure bet that nothing will happen at it. But if the Washington Post got this right, then Republicans have already made a major concession to start the negotiation:

Senior Republicans conceded Wednesday that a deal is unlikely on a contentious plan to overhaul Medicare and offered to open budget talks with the White House by focusing on areas where both parties can agree, such as cutting farm subsidies.

On the eve of debt-reduction talks led by Vice President Biden, House Majority Leader Eric Cantor (Va.) said Republicans remain convinced that reining in federal retirement programs is the key to stabilizing the nation’s finances over the long term. But he said Republicans recognize they may need to look elsewhere to achieve consensus after President Obama “excoriated us” for a proposal to privatize Medicare.

That search could start, Cantor said, with a list of GOP proposals that would save $715 billion over the next decade by ending payments to wealthy farmers, limiting lawsuits against doctors, and expanding government auctions of broadcast spectrum to telecommunications companies, among other items.

Um, Republicans aren’t dropping their Medicare phase-out plan because Obama was mean to them. They’re dropping it because it’s deeply unpopular and their constituents gave them an earful about it over the past two weeks. I’m sure this was preceded by freshman Republicans pleading with the leadership to stop the suicide mission. And no doubt Wall Street looking over the shoulder of the House GOP loomed large.

By the way, if Cantor thinks that Democrats and their allies will suddenly forgive and forget about Republicans and their vote to, yes, end Medicare, he’d better not watch TV in October 2012.

Now, Cantor is trying to take back the story. But both the story and his insistence that he’s still with Paul Ryan can be consistent. Cantor will press for the Ryan budget but the Medicare pieces won’t be a deal-breaker. I don’t know why he felt the need to pre-negotiate, but it’s a common Washington occurrence.

You can see with the examples above that the spending cuts may come in some areas of common ground. Slashing Big Ag subsidies makes sense, and according to Politico Republicans will set a “target” for cutting Big Oil subsidies, suggesting that Democrats won that debate as well. Now, my preference would be to see that money channeled into direct job creation (we’ll get there in a future post), but if you’re going to cut, that’s certainly fat that can be trimmed.

As for what else will come out of a debt limit deal, it looks to have caps and triggers as its major parts.

In addition to raising the debt ceiling from its current limit of $14.3 trillion, lawmakers would include legislative language in the bill that called for caps on government spending in over the next one or two years. The level at which that cap would be set is unclear and is likely to be a major fault line during discussions. In addition, lawmakers will include a debt failsafe “trigger” that would kick in once those caps expire. Such a policy — which would require that the ratio of debt-to-GDP be reduced to a certain level if Congress cannot stabilize it by the end of the decade — could take several forms. Democrats, however, will insist that revenue raisers or adjustments to the tax code be part of the deal.

“That’s the ball game,” one top Democratic aide said of ensuring that tax policy be part of the final arrangement to raise the debt ceiling.

“[T]hey want to make it a trigger that allows for revenue,” added another Democratic Senate aide. “But this arrangement wouldn’t preclude them from saying they will cap spending for, say, 2012. It would allow them to say here is your spending.”

This is a hybrid spending/deficit cap that puts off the real questions – like where to cut if the deficit goes above the cap – to a future Congress. But if Washington excels at anything, it’s how to design triggers that never trigger. And if this story is correct that the deal would seek to lower the deficit to 3% of GDP in 2015, then as Bill McBride says it’s a nothingburger.

I find this amusing. First the current CBO projection shows the deficit at 3% of GDP in 2015 – so this is a big yawn, plus a future congress can change the rules. Of course the 3% includes the expiration of the tax cuts at the end of 2012, but that just means another battle after the election. (Note: the tax cuts were really “tax shifts” since they shifted the burden to future taxpayers).

It looks like the debt limit will be a light sashay, with the real issues put off to the 2012 budget and beyond. Of course, this remains the wrong conversation to be having.