The Progessive Caucus in the House is organizing to prevent any cuts whatsoever in Medicare or Social Security:

House liberals are launching an organizing drive inside the Democatic caucus, in an effort to line up Democrats and get them to commit to opposing any final deficit deal that contains any cuts to entitlements benefits, according to a letter I've obtained.

The two co-chairs of the Congressional Progressive Caucus have sent the letter to Nancy Pelosi, pledging to stand behind her insistence that the final deal contain no benefits cuts to Social Security, Medicare, or Medicaid.

The letter will be used next week to gather signatures from House Dems, in an effort to maximize for Democrats by developing a unified front behind a refusal to support any cuts to those programs that reduce benefits or eligibility.

This sets up a very interesting scenario. If - and it is by no means certain - that Boehner and Obama can reach a deal, there is the possibility that it would fail to pass the House due to both conservative and liberal opposition. Conservatives will vote against any tax increases while liberals will vote against any cuts in entitlements.

Unless one or both sides change their positions, we are going to find out which analysts are right about what happens on August 3rd; those who say nothing will happen and those who say we'll have a financial meltdown.