The president is expected to urge Congress to address entitlement reform, particularly Social Security's long-term funding shortfall.

Democrats have rejected and described as a "non-starter" President Bush's proposal to create individual investment accounts that workers would fund with some of their Social Security taxes.

But there is bipartisan willingness to discuss reducing long-term deficits.

Bottom line: The president has asked Treasury Secretary Henry Paulson to reach out to Democrats to explore bipartisan solutions to Social Security's long-term shortfall, and a number of Democratic leaders have said they are in talks with him. (See where both sides' political bending points may be and learn more about the specifics of Social Security's long-term funding outlook.)

It's not yet clear though whether the discussions will result in any changes before the 2008 presidential elections.