Skip to comments.Obama to offer Social Security cuts in new budget — in exchange for tax hikes
Posted on 04/05/2013 9:22:29 AM PDT by SeekAndFind
No wonder it's taking so long for Barack Obama to send his budget proposal to Congress. The budget is almost two months overdue, but Republicans may find it worth the wait. The Washington Post reports that Obama will offer cuts to Social Security in exchange for tax hikes to close the deficit --- in effect, the grand bargain he and John Boehner nearly made two years ago:
President Obama will release a budget next week that proposes significant cuts to Medicare and Social Security and fewer tax hikes than in the past, a conciliatory approach that he hopes will convince Republicans to sign onto a grand bargain that would curb government borrowing and replace deep spending cuts that took effect March 1.
When he unveils the budget on Wednesday, Obama will break with the tradition of providing a sweeping vision of his ideal spending priorities, untethered from political realities. Instead, the document will incorporate the compromise offer Obama made to House Speaker John Boehner (R-Ohio) last December in the discussions over the so-called fiscal cliff which included $1.8 trillion in deficit reduction through spending cuts and tax increases. …
While Republicans are certain to be skeptical of Obamas call for more taxes, the president also is likely to face immediate heat over his budget proposal from some Democrats and liberal supporters. Obama proposes, for instance, to change the cost-of-living calculation for Social Security in a way that will reduce benefits for most beneficiaries, a key Republican request that he had earlier embraced only as part of a compromise. Many Democrats say they areopposed to any Social Security cuts and are likely to be furious that such cuts are now being proposed as official administration policy.
While this is not the presidents ideal deficit reduction plan, and there are particular proposals in this plan like the [cost-of-living] change that were key Republican requests and not the presidents preferred approach, the senior administration official said, this is a compromise proposal built on common ground, and the president felt it was important to make it clear that the offer still stands.
Strictly from a political standpoint, the public offer is surprising, almost shocking. Without a doubt, Democrats in the 2014 cycle would have used the senior-scaring tactics of the last decade or more when it comes to Republican demands for entitlement reform and deficit control. Most of those efforts have focused on Medicare and its greater threat to the nation’s fiscal health. When Paul Ryan offered two budgets to turn Medicare into an exchange program not dissimilar to ObamaCare for the rest of the nation, Democrats ran ads that pictured a Ryan stand-in pushing Grandma over a cliff.
That strategy is useless now that Obama has essentially endorsed entitlement reform, and proposed his own Social Security cuts — and also to Medicare, as the Post notes deeper in the piece:
The budget proposal slices $200 billion from already tight defense and domestic budgets. It would cut $400 billion from Medicare and other health programs by negotiating better prescription drug prices and asking wealthy seniors to pay more, among other policies. It would also generate $200 billion in savings by scaling back farm subsidies and federal retiree programs, among other proposals.
The proposal to change the formula to calculate Social Security payments, also originally part of the offer to Boehner, would generate $130 billion in savings and $100 billion in revenue, a result of the impact of the formula change on other government programs. But it is the change in Social Security payments to most recipients that is likely to generate the greatest outcry from the Obama administrations traditional allies.
The change in Social Security actually is more modest than in Medicare. The former appears to be the adoption of chained CPI to calculate increases in payments, which will result in lower increases rather than cuts, which means that the savings are based on future projections rather than current rates of expenditures. The cuts to Medicare look like actual cuts, and perhaps even more significant, use means testing to generate revenues, a strategy that both parties have avoided in order to maintain the illusion that Medicare (and Social Security, which acts as a qualifier) aren’t welfare programs.
This proposal puts both parties on the political hook for proposing entitlement cuts and higher fees. A good entitlement reform package might be worth a trade for tax hikes, although comprehensive tax reform would be a better idea, which this proposal nibbles at but doesn’t deliver. Unfortunately, while the SSA reform on chained CPI is a good idea, the Medicare reform goes in the wrong direction — or at least in an ineffective direction. Ryan’s strategy to introduce choice in the form of public/private exchanges and most importantly a defined-contribution relationship of government to the system is the most effective way to solidify Medicare and solve the fiscal disaster than looms in the program. Perhaps this admission by Obama of the need to restrain costs in a real way will open the door to the Ryan/Wyden approach, which would be worth a tax hike to get passed.
My extended family is Catholic and for generations the majority of them have voted Republican. Most of them live in the New York area. My late uncle, a Catholic, was a Republican party official on Long Island, NY many years ago.
My first cousin....she’s an elementary school teacher on Long Island, and a Catholic, told me in late October that she couldn’t wait to go the polls and vote for Romney. She said she wished she could vote for him twice. When I asked her about damage from Superstorm Sandy, she told me she would swim to the polls if she had to.
I also have relatives who have lived their entire lives in Massachusetts and they are staunch conservatives, as well as Catholic. So, there’s hope.
The Catholic vote is skewed because, unfortunately, vast numbers of Mexican and Puerto Rican Catholics vote for the dems.
The thing is that the Catholic vote has always been democrat, there are only about five exceptions in our history, Catholics immigrating from the most Catholic nations are not really changing anything, they are just keeping it normal.
He simply “filled the order” required. Doubt any thought put into it as he knows it won’t fly. But he can say he did it, and that’s about the it of it....next!
Interesting that he is willing to cut the one thing that Americans are forced to pay into and actually have skin in that game.
And that, precisely, is my thesis. Thank you. It’s not about Catholicism. It’s about race.
The last time Republicans won is when they won the Catholic vote.
Perhaps Republicans should be waking up to that fact.
You are saying that democrats do win because of the Catholic vote, and the reason the republicans won the popular vote in 2004 is because when Protestants can get 50 or 51% of the Catholics to vote pro-life conservative, then the democrats lose.
I think that is what the point is, the fact that the Catholic vote is what the democrats depend on and pin their hopes on, and they pray for more Catholics and atheists.
Can you explain your promotion of the democrat party and their agenda? Your claim is that the democrat party is naturally the home of Catholics because the republicans have the wrong politics in comparison, that their pro-abortion democrat vote is appropriate for Catholics.
Obama is stuck on stupid. No social security cuts. No tax increases.
Scrap obamacare, quit looting social security, privitize a portion of social security, cut taxes and stimulate growth. That will get people working and bring in more revenue
Feel free to cite a post where I defend abortion or gay marriage.
I will call out pro abortion and pro sodomy republicans, and protestants rather then give them cover.
Why should conservative Catholics support a party that supports homosexuality and abortion?
I am saying precisely the opposite.
The numbers indicate that the Democrats do not require the Catholic vote while the Republicans do.
If you remove the entire Catholic electorate - Obama still wins in both 2008, and in 2012.
If you remove the entire Catholic electorate in 2004, Bush loses.
Ergo, I conclude that the Republican party now requires the support of Catholics in order to win. The Democrat party does not.
true but the north east with all of its Catholics should be the most conservative and it isnt because they call themselves Catholic but vote against their faith
I have never understood this. How can you call yourself Catholic or any other Christian, and vote for abortion? The Hispanic population has always stumped me with this also, since they are generally very family oriented and religious people as a whole.
Why indeed, why do Catholics vote majority democrat?
Now he can tell all those who get their SS cut, the Republicans made him do it.
The Republicans will fall for anything.
The Catholic vote has always been know to lean left, big city democrat machines and unions depended on it.
The Catholic vote has never been known as conservative or right wing.
Crazy that obamma has racked up an additional $6 trillion in debt in less than 5 years and now he wants to talk debt reduction? Very crazy indeed!
The cuts to Social Security are cuts in the rate of growth of Social Security, something the democrats in Congress racked Bush over the coals about when he suggested it.
obamma gets a pass because he is a Democrat.