Two Republican senators want to use the threat of an economic meltdown to raise the retirement age and cut Medicare. Sens. Bob Corker (R-TN) and Lamar Alexander (R-TN) introduced a plan today that would raise the federal debt limit by $1 trillion in exchange for $1 trillion in cuts to Medicare, Medicaid, and Social Security, as The Hill reported:

The Corker-Alexander dollar-for-dollar plan has several components.

It would structurally reform Medicare by creating competing private options giving seniors greater choice of healthcare plans. It would not, however, cap Medicare spending.

The plan would also give states more flexibility to manage Medicaid programs and prevent states from “gaming the federal share of the program with state tax charges.”

It would gradually raise the Social Security retirement age and use the “chained CPI” formula to calculate cost-of-living adjustments, curbing the growing cost of benefits.

In exchange, it would direct the debt limit be increased by the same amount as the savings generated from entitlement reform.

The U.S. will hit its debt limit on or around December 31st. The Treasury Department estimates that, using extraordinary measures, it could avoid default for another two months or so. Allowing the U.S. to default on its debt via not raising the debt ceiling could cause a complete financial meltdown. The 2011 debt ceiling debacle — during which House Republicans nearly pushed the country into a default due to their intransigence on taxes — cost the country about $19 billion in higher interest payments and at least one million jobs.

Corker and Alexander are threatening more economic chaos in order to achieve one of the most regressive potential policy changes. Though lawmakers point to America’s increasing life expectancy in order to justify raising the retirement age, life expectancy is only increasing for wealthier workers in non-physical jobs. As the Center for Economic and Policy Research put it, “there has been a sharp rise in inequality in life expectancy by income over the last three decades that mirrors the growth in inequality in income.”

On Friday morning, outgoing Sen. Olympia Snowe (R-ME) attributed the GOP’s reluctance to reach a balanced deal that could avert the so-called fiscal cliff to Grover Norquist’s pledge, which prevents Republicans from supporting a tax increase. President Obama has called on lawmakers to pass a package that maintains the Bush tax cuts for families earning less than $250,000 a year, though Republicans have thus far ignored his call and unsuccessfully attempted to advance a much more modest measure that preserved tax breaks for incomes under a million dollars.

Appearing on CNN’s Starting Point, Snowe — who backs a deal that would maintain current tax rates for families earning $400,000 and less — called on Republicans and Democrats to compromise, but noted that the no-tax pledge may be holding them back:

ALI VELSHI (HOST): Talk to me about this. I certainly don’t want to demonize people who ideologically believe taxes shouldn’t go up on anyone or don’t want taxes to go up because they think it’s damaging to the economy. I think there are a lot of Americans who are quite prepared to demonize people who will not change their view or cast a vote because it offends Grover Norquist. What role do the pledges play in our inability to compromise?

SNOWE: Well, I’m certain it does play a role. I’ve never signed these pledges because my obligation to the people who elected me and that’s the way it should be for each member of Congress, because times change. The circumstances change, you have to address the issue at hand. It is important to have extending the tax cuts for especially the middle income but secondly to put spending cuts on the table.

Watch it:

With four days left until the end of the year, President Obama will host the congressional leaders in the Oval Office today in hopes of reaching a compromise. The House and Senate are back in session, but House Speaker John Boehner (R-OH) refuses to take an up or down vote on a Senate-passed bill extending tax cuts to Americans earning less than $250,000 and Senate Minority Leader Mitch McConnell (R-KY) is now demanding spending cuts to pay for an extension to the federal unemployment insurance program that expires at the end of the year. The Washington Post reports that McConnell “for the first time was engaged directly in talks with the White House. He signaled an interest in cutting a deal.”

Yet Norquist is still urging lawmakers to stand by his hardline position, tweeting, “We had an election Boehner was elected speaker. Now lame duck obama should get over it (Also 30 GOP governors).”

Unless a deal is reached with management, some 14,000 East Coast port workers plan to go on strike on Sunday, affecting ports from Boston to Miami. Here’s what you need to know about the impending strike:

1) Management wants to cut workers’ pay. The largest sticking point in the negotiations between the port workers and a coalition of companies known as the United States Maritime Alliance (USMX) is a payment to workers for each container they unload. Instituted in the 1960s, the payments are meant as compensation for the mechanization of America’s ports, which allows one worker today to do what used to take three workers. As the New York Times explained, “The companies want to freeze those payments for current longshoremen and eliminate them for future hires.” The companies also want to cut future raises for workers to below the rate of inflation.

2) Port workers are highly skilled. The companies claim that workers are paid too much, rendering east coast ports uncompetitive. But the workers — whose numbers have dropped from 35,000 to 3,500 due to automation — are highly trained and “cannot be easily replaced.” They also do not work consistent hours. According to the union, “longshore labor cost amounts to between 3% and 4% of the shipper’s total cost.”

3) The economic impact could be significant…or not. As Brad Plumer explained in the Washington Post, it’s hard to figure out the economic impact of port closures. Estimates place the impact of a 2002 West Coast port closure at $1 billion per day, but the cost may have actually been far less than that.

4) Businesses are using political pressure to entice workers to cave. Business leaders and right-wing governors are urging the White House to invoke special powers to end the strike, should workers walk out. President Obama, for his part, urged the two sides to forge an agreement “as quickly as possible.”

The strike would be the first at East Coast ports since 1977.