I just watched Sen. Chuck Schumer tell MSNBC’s Andrea Mitchell that once this deal is out of the way, Congress will resume budget negotiations, and everything, including so-called “entitlements,” must be on the table. House Minority Leader Nancy Pelosi was a little bit more balanced, insisting Democrats should only look at entitlement cuts in exchange for more revenues from people who can pay more. “Why should Granny pay the price?” without asking the rich to share the sacrifice, Pelosi asked.
But with all due respect to the once (and perhaps future) speaker, who’s been the toughest Democrat over the last five years: The answer is Granny shouldn’t pay any price. When Social Security needs “fixing,” we should lift the cap on income subject to the payroll tax. The chained CPI is a cut and shouldn’t be a first offer, but a last resort.
Likewise, President Obama took a tax rate hike off the table this month in an interview with CNBC’s John Harwood; Congressional Democratic leaders should put it back on the table immediately.
I’ve been impressed by the way Pelosi and Senate Majority Leader Harry Reid have kept their caucus together. I’ve also liked seeing new life among Congressional progressives. With the quiet backing of Reid in the Senate, they cleared space for the most progressive likely Fed chair pick, Janet Yellen. They need to make sure that any new budget deal doesn’t start with the president’s budget, which concedes too much to the GOP already.
Maybe Democrats, including the president, feel secure that they can nod to the debt-reduction wise men and promise to do the right thing — which in the real world is the wrong thing — because it’s a deal they’ll never have to deliver on: House Republicans won’t give up any revenue to get it. Still, I’m tired of Democrats endorsing what are essentially GOP narratives about the way the world works: Deficit reduction is more important than economic growth or income inequality.
Democrats so often snatch defeat from the jaws of victory. It would be a shame if they humbled the GOP this round only to hand them what they want in the next. Everyone’s looking to see whether Republicans learned their lesson from this debacle; we need to make sure Democrats did, too. If they return to their role as “enablers,” in Pelosi’s words, they’re part of the problem.
Will Dems screw us?
If the Democrats and the media keep using the term “entitlements” we WILL get screwed. Social Security Insurance is not an entitlement. It’s insurance that all workers pay into with each paycheck. Medicare is not an entitlement. It’s a program that all workers pay into with each paycheck. Unemployment Insurance is not an entitlemet. It’s insurance. It’s right there in its name. Food Stamps may be an entitlement, but don’t people have a right to expect to be fed? And clothed? And housed? By millionaires and billionaires?
As long as “…everything…must be on the table…”, here’s an item I hope is on the table:
Assumptions about whether government revenues are going to steadily and predictable grow, and by how much – because OF COURSE the economy is going to grow, too. And this snag we’re in is only a little temporary thing, until we get back to full-throttle growth.
Because “growth” is the natural state of things, isn’t it, and it will go on forever and ever, won’t it?
(Hint: NOT)
The main thing that the adults in the room should be considering are what are our budget priorities if the economy is not growing; even more so if it starts to shrink.
More and more of the capital we accumulate is going into more expensive fossil fuel drilling, leaving less room for capital investment in other areas where traditionally the jobs, and the growth, and the income came from.
What if that “growth engine” stalls out, due in large part to the increased relative costs of nonrenewable resources? Where do our budget allotments and projections go then?
Until we address this matter realistically, these budget problems are going to keep cropping up on a routine basis. Powerful economic and political interests can blame the greedy “takers” of society, but brother that ain’t it.
If you’re naive enough to count Schumer as a Democrat, then be prepared to be screwed . . . hard. Schumer’s never met a policy that actually helps Americans that he wouldn’t throw under the bus for the 1% in a heartbeat.