Under the deal President Obama signed on Tuesday, the top four Republican and Democratic leaders in Congress will each appoint three members to a special committee that must recommend by November 23 at least $1.5 trillion in additional deficit reduction through 2021. If a majority of committee members endorse a proposal, that plan is guaranteed a floor vote in both chambers by December 23 without amendment or Senate filibuster.

Those rules provide this group with vastly more leverage to stabilize the nation’s finances than any previous commission has possessed. The procedures effectively preempt a minority veto—either through the Senate filibuster or the informal House rule that legislation reaches the floor only if a “majority of the majority” party supports it. Because a majority proposal from the committee could be passed with any combination of Republican and Democratic votes, it provides a unique opportunity for the center of both parties to impose a balanced solution on the ideological vanguard of left and right.

* Crucially, Obama will vow to veto any entitlement cuts if revenue increases are not part of the solution.

That last one is key — a veto threat is a line the White House was unwilling to draw during the fall of 2010, when the battle over extending the Bush tax cuts was in full swing.

What’s in it?

Well, $1.5 trillion of it is higher taxes. About half of that is the expiration of the “rich people only” portion of the Bush tax cuts. The rest comes from closing loopholes and for the proposed new millionaire’s minimum tax so that high-income individuals won’t be paying lower marginal rates than the middle class.

Then you have about $1 trillion in war savings as the fighting winds down in Iraq and Afghanistan.

Last, you have the domestic spending element. That includes changes worth $248 billion to Medicare and $72 billion to Medicaid which the administration is promising fall on providers rather than patients and don’t involve any deep changes to the basic nature of the programs... There are also some other domestic spending cuts, worth about $200 billion...

the “other” cuts, which are as follows:
— $33 billion from agriculture subsidies.
— $42.5 billion from Federal employee retirement benefits, on both the civilian and military side.
— $4.1 billion from the disposal of unused government assets.
— $92.2 billion from restructuring government operations and reducing government liabilities.
— $77.6 billion from improving Federal program management and reducing waste and abuse.

The Budget Control Act increased the debt ceiling by $400 billion in August 2011. Concurrently, it requires the federal government to make $917 billion in spending cuts over a ten-year period as a first installment, in keeping with estimates from the Congressional Budget Office that assume that the current laws will stay the same, including the expiration of the Bush tax cuts from 2001 and 2003 that were extended for two years in 2010. Under the plan, government revenues are projected to rise after 2012.

* Increased investor uncertainty. Investors already have little confidence Republicans and Democrats can bridge a yawning ideological divide over tax policy and who should shoulder the burden for reducing deficits. The U.S. Congress has had trouble passing even routine legislation this year, leading to repeated disruptions of government services.

* The committee's failure is unlikely to trigger another downgrade of the U.S. credit rating. Rating agencies have said they will look at a range of factors in making any decision but that the committee's washout will not be decisive.

* Republicans are already making noises about altering the $1.2 trillion in automatic spending cuts, or sequesters, that are due to kick in 2013 as a result of the super committee's failure. They want to soften the planned $600 billion defense cuts. If Congress starts tinkering with the sequesters, however, financial markets could become unnerved by the unraveling of savings seen as already "in the bank." Again, the 2012 elections could determine the fate of these cuts.

* Democrats and Republicans will try to use the super committee's dead end for political gain. Democrats will say the outcome is further evidence Republicans just want to protect the rich from sharing the burden of deficit reduction. Republicans will argue that, once again, Democrats fail to grasp the gravity of escalating costs of healthcare benefits.

* The White House had been bracing for days for the committee's failure and believes President Barack Obama can weather it without major political fallout and may even be able to score points against Republicans as he seeks re-election.

If the committee charged with reducing the federal deficit fails to put forward a viable plan, Rep. Ron Paul says Congress won't allow the resulting automatic budget cuts to proceed.

The reason? The cuts threaten the military budget.

"The sentiment is very strong, both right and left," he said this morning at an event sponsored by the libertarian Cato Institute. "They're obsessed with militarism; they're obsessed with more wars; they're obsessed with our foreign policy."

If the committee fails to agree on a package or the full Congress fails to pass it, a so-called "trigger mechanism" would enact $1.2 trillion in automatic spending cuts to serve as the second installment of deficit reduction measures.These cuts would be split between the national security and domestic arenas, but the biggest entitlement programs would be excluded from these automatic cuts.

And so: Any news outlet that doesn’t leave readers and viewers with an absolutely clear sense that the primary sticking point was over whether the rich should see their contribution to deficit reduction increase or decrease is letting down its customers.