I should be more upset about this than I am:
President Obama next week will take the political risk of formally proposing cuts to Social Security and Medicare in his annual budget in an effort to demonstrate his willingness to compromise with Republicans and revive prospects for a long-term deficit-reduction deal, administration officials say....First of all, there's zero chance of a bargain aloing the lines Obama is proposing, which includes a "demand for higher taxes from wealthy individuals and some corporations." The fifth sentence of the New York Times article I'm quoting begins:
The administration's hope is to create cracks in Republicans' antitax resistance....That cracks me up. As if it could actually happen.
I can never tell if the administration actually understand that there is no chance whatsoever of this and is just posturing, or if hope really does spring eternal in Obamaites' "grand bargain"-craving heads. But it doesn't matter -- or at least it doesn't matter as long as the president stands firm on the tax-the-rich quid for his screw-the-beneficiaries quo. The GOP will never, ever go for it.
A Social Security cut based on a shift to chained CPI is part of the president's proposal. I see that BooMan thinks this is not awful. This will upset some of you, but I think he's right that it's a less bad option than a lot of other proposals that have been floated. BooMan cites a December Salon article by Alex Seitz-Wald. What Seitz-Wald wrote about the dealmaking then seems relevant now:
The key question is this: Do you believe Obama can get a deal without cutting anything from social safety entitlement programs, or is he going to have to do something? If you fall in the former camp, then the chained CPI is dead on arrival. But, if you think we're going to have to cut entitlements at some point, then the chained CPI is probably the least bad option of a menu of bad possibilities, including raising the Medicare retirement age, which is the most likely alternative and would be far more harmful.That's the point: we are probably going to have to cut entitlements at some point because liberal budget alternatives that spare entitlements are simply considered beyond the pale in the Beltway. And until our side figures out a way to get such proposals into the debate in a serious way -- with a serious chance of passage -- then the calls for austerity are going to be relentless, and thus it's not surprising that the president feels he has to propose something austere.
I've looked at the "what you lose" calculator for chained CPI at the Web site of AARP (which opposes the idea). I plugged in my age (54), and, because I'm not collecting benefits yet, I plugged in the average annual Social Security benefit, as AARP suggests (it's $15,190). The calculator tells me that over ten years, under chained CPI, I'll lose $2,354.81 -- or about $20 a month. I don't know why the hell ordinary Americans have to pay more for the recent follies of our betters -- but if the system insists that we have to (and that seems to be the case), then this is a hit I could endure. Yes, it's a lot of money for the very poor and very elderly, but the Times story says the White House proposal includes "financial protections for low-income and very old beneficiaries."
The ridiculous thing about this is that even though the president is talking about deficit reductions (past and proposed) that are 80% spending cuts and 20% tax increases, he's going to continue to be attacked as a compulsive taxer and spender by the GOP. And even though the GOP wants massive benefit cuts, dwarfing what Obama is proposing, Republicans are going to run against Democrats as benefit cutters in 2014.
So this sucks -- but it would take a great liberal revival in America to get reasonable counterproposals on the table.
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AND: In case it's not clear what I mean by "a great liberal revival," what I mean is a serious increase in the number of Americans, especially white heartland Americans, who viscerally understand how right and right-centrist economic policies screw them, and who are motivated to vote for politicians who resist those policies.
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UPDATE: AARP calculator link fixed.
