Michele L. Swers Georgetown University Associate Professor of American Government :
A balanced budget is not likely in the near future. When President Clinton and the Republican Congress were negotiating, they did agree on some budget cuts and rules to try to restrain spending but they were also aided by the increased tax revenue that came from a good economy. Today to create a balanced budget would require significant and painful cuts in discretionary defense and social welfare spending as well as cuts in entitlement spending, particularly Medicare because the Great Recession means tax revenue will not significantly increase anytime soon unless we raise taxes.
To date, Congress finds it easier to agree on expanding health benefits, thus the expansion of Medicare to include a prescription drug benefit without paying for it under a Republican president and Congress. However, Congress has not been able to implement significant cuts in health spending witness the planned cuts in payments for providers which are annually increased through a convoluted set of negotiations to pass a "doc fix".
With no appetite to raise taxes and disagreement among President Obama and Congressional Republicans on where to cut spending and how much to cut, future budget deals will likely reduce the size of the annual deficit but will not eliminate them in the near future. Beyond cutting spending, there is a possibility that President Obama and the Republican Congress could reach a deal on tax reform to increase government revenue by streamlining the system and eliminating loopholes much the way President Reagan and a Democratic Congress reached a tax reform deal in the late 1980s.