Category: Bipartisan Wet Dream

It’s heeeere! Call now!

~ susie ~ 1 Comment

Here it is, the attack on our earned benefits. Please, keep calling. The White House switchboard is 202-456-1414. The comments line is 202-456-1111.

Numbers for the Senate are hereNumbers for the House are here.

President Obama on Wednesday unveiled a $3.77 trillion spending plan that proposes modest new investments in infrastructure and education, major new taxes for the wealthy and significant reforms aimed at reducing the cost of Social Security and Medicare.

“Our economy is poised for progess, as long as Washington doesn’t get in the way,” Obama said in announcing his budget plan on the South Lawn of the White House. He said his budget represents “a fiscally responsible blueprint for middle-class jobs and growth.”

“We don’t view this budget as a starting point in the negotiations. This is an offer where the president came more than halfway toward the Republicans,” a senior administration official told reporters Tuesday, speaking on condition of anonymity to detail the forthcoming document.

“So this is our sticking point,” the official said. “And the question is: are Republicans going to be willing to come to us to do serious things to reduce our deficits” – including raising taxes on millionaires.

So far, senior Republicans have rejected the proposal, which would sharply increase both spending and deficits next year over current projections. While the nonpartisan Congressional Budget Office forecasts $3.6 trillion in outlays in the fiscal year that begins in October, Obama calls for $170 billion more.

And while the CBO forecasts a deficit of $616 billion in 2014, Obama calls for a larger gap between spending and revenues of $744 billion, administration officials said, or 4.4 percent of the nation’s gross domestic product.

The budget gap would narrow over the coming decade, shrinking to 1.7 percent of GDP by 2023, when the national debt would also be shrinking as a measure of the overall economy.

But Obama proposes to lop only about $600 billion off projected borrowing over the next decade — trillions of dollars less than the austere, balanced-budget package that House Republicans endorsed earlier this year. While Obama proposes $1.8 trillion in new savings and tax revenue over the next decade, much of the money would be dedicated to replacing the sequester, $1.2 trillion in automatic spending cuts that went into effect March 1.

Obama’s deficit-reduction plan mirrors the offer he made in December to House Speaker John A. Boehner (R-Ohio) in negotiations over the so-called fiscal cliff. At the time, Obama called for $1.2 trillion in new taxes. The fiscal cliff deal included roughly $600 billion in new revenues over the next decade, with the bulk of the money coming from higher rates on households earning more than $450,000 a year.

[…] As he has in the past, Obama proposes to slice $400 billion from federal health programs, primarily Medicare, with the bulk of the cuts falling on drug companies and other providers. But Medicare beneficiaries would also take a hit, through higher premiums for couples making more than $170,000 a year and inducements for low-income recipients to use more generic drugs.

And for the first time, Obama formally proposes to slow the growth in Social Security benefits by applying a less-generous measure of inflation to programs throughout the federal government. The change would trim cost-of-living increases by roughly 0.3 percent a year, saving the government about $130 billion over the next decade.

White House officials said the new inflation measure — known as the chained consumer price index, or chained CPI — would not apply to programs for the poor, such as Supplemental Security Income, or SSI, and would be adjusted to reduce the impact on people 77 or older.

The deficit-reduction plan mirrors an offer Obama made in December to House Speaker John A. Boehner (R-Ohio) in negotiations over the so-called fiscal cliff. At the time, Obama called for $1.2 trillion in new taxes, but the fiscal cliff deal included roughly $600 billion in new revenues over the next decade, with the bulk of the money coming from higher rates on households earning more than $450,000 a year.

Obama’s decision to include chained CPI in his budget proposal has infuriated many Democrats, and a number of liberal lawmakers protested the Social Security cuts Tuesday at the White House. Republicans, meanwhile, who have pressed the president to put the change on the table, have so far dismissed the offer as too “modest” to justify GOP support for higher taxes.

Both sides hate it

~ susie ~ 8 Comments

Did you call yet? Call your senators, call your congress critter, call the White House.

The chained CPI. And yet, the Very Serious People are Very Serious about it”

On the news that President Obama’s budget indeed contains a highly unpopular proposal for Social Security cuts known as “chained CPI,” a new poll by the American Association of Retired Persons shows us exactly how unpopular it is.

The AARP reveals that 70 percent of voters age 50-plus oppose the use of the chained CPI to cut benefits, and two-thirds of them – including 60 percent of Republicans — say they would be “considerably less likely” to support a congressional candidate if he or she backed a new way of calculating consumer prices. And 84 percent of voters over 50 say Social Security has no place in budget-deficit discussions, since it is self-financed.

On every single question, Republicans lag only a point or two behind Democrats in their opposition to Social Security cuts.

Michael Lind explains why it’s such a bad deal on policy terms here. I’ve written about it many times, including here. The AARP opposes it on policy terms. Now its new survey shows how risky it is politically.

“The chained CPI reduction snowballs over time and would increase taxes for most taxpayers — at the same time that it cuts benefits for children, veterans, widows, retirees, and people with disabilities,” said AARP executive vice president Nancy LeaMond in a statement. “As this survey shows, older Americans oppose the chained CPI and they’ve historically made their opinions known to their elected officials.”

Just remember, a lot of the people who will make angry statements over the next few weeks are the same people who insisted they wouldn’t support the affordable care act without a public option. So time will tell who’s full of shit.

John Boehner, our new best friend

~ susie ~ 2 Comments

So contrary to some people’s opinion, even Young Ezra (White House conduit) admits we’re not imagining things. Obama really is trying to give it away — but Boehner won’t take it. Imagine that!

As Greg Sargent notes, just a few months ago, top Republicans were saying that this was, indeed, the exact way to move the country forward. Senate Minority Leader Mitch McConnell told the Wall Street Journal that “higher Medicare premiums for the wealthy, an increase in the Medicare eligibility age and slowing cost-of-living increases for Social Security” were “the kinds of things that would get Republicans interested in new revenue.”

A Republican congressional aide told Bloomberg that chained-CPI — which is included in Obama’s budget — was Boehner’s top priority.

“And so we have a moment of clarity in this debate once again,” writes Sargent. “There is literally nothing that Obama can offer Republicans — not even things they themselves have asked for — that would induce them to agree to a compromise on new revenues.”

It would go too far to say Boehner is playing directly into the hands of the White House. But he’s certainly playing directly into the hands of liberals.

There’s a strain of thought in the Republican Party that believes Obama’s public positions are just a ruse and he’s really a hardcore, old-fashioned liberal with no interest in a budget deal and no higher political goal than the absolute destruction of the GOP.

Liberals hold the opposite concern. They worry that Obama’s public positions are just his opening bid, and he’s really a hardcore, ’90s-style DLC Democrat who has no higher political goal than a bipartisan budget deal and would happily sign off on a bill that slashed Medicare and Social Security as long as Republicans would agree to some taxes.

Perhaps unsurprisingly, liberals have a better understanding of the White House’s underlying motives than Republicans. But quite surprisingly, Republicans keep saving liberals from their president.
As badly as Obama wants a budget deal, Boehner seems just as determined to keep him from reaching one. For liberals, this is close to an ideal situation. The Republican Party’s brand continues to worsen. The Democratic president manages to look reasonable without ever actually signing a painful compromise into law. And Medicare and Social Security remain safe.

The catfood chronicles

~ susie ~ 3 Comments

Yves Smith:

There is no more pretense possible. As we’ve warned for some time, Obama is eager to put a notch on his belt by being the President that rolled back the New Deal programs that helped create broad-based middle-class prosperity and dignity. He’s cast himself as an adult inflicting discipline on profligate Americans. But in reality, the profligacy was most concentrated among elite financiers who used leverage on leverage vehicles to stoke liquidity that led to worldwide underpricing of risk. They paid themselves record bonuses in the years immediately preceding the crisis, and then in a grotesque display of ingratitude, did so again in 2009, able to do so only thanks to massive taxpayer support, alphabet-soup special borrowing programs, and the tax on savers known as ZIRP. And the direct result of their looting exercise that produced the crisis was the explosion in government deficits, due to a collapse in tax revenues and a rise in payments under countercyclical programs such as unemployment insurance and food stamps.

Quotes of the day

~ susie ~ 1 Comment

“You can’t call yourself a Democrat and support Social Security benefit cuts. The president is proposing to steal thousands of dollars from grandparents and veterans by cutting cost of living adjustments, and any congressional Democrat who votes for such a plan should be ready for a primary challenge. Social Security is the core of the progressive and Democratic legacy. The President has no mandate to cut these benefits, and progressives will do everything possible to stop him.”

— Stephanie Taylor, Progressive Change Campaign Committee co-founder

“The news that the Democratic President will be openly pushing for cuts to Social Security benefits is a profoundly disturbing shot across the bow for the progressives who called their neighbors, spent weekends knocking doors and donated millions to reelect him.”

“Let’s be clear: President Obama, when it comes to cutting Social Security, Medicaid or Medicare benefits, over 200,000 progressive members of your own party don’t “have your back” and we are prepared to fight you every step of the way.”

— Jim Dean, Chair, Democracy for America

Bipartisan solutions

~ susie ~ 2 Comments

It’s one week until Obama’s budget drops, and I strongly urge you to call your senators. Tell them you want no part of the Grand Bargain. The reason you need to call them is that the Senate will pass a bipartisan bill and get a vote on the House floor, and we want to stop it. Please call today:

Dave Johnson at Seeing the Forest:

Here is how the DC game works:

– One side proposes to kill everyone in Kentucky and Tennessee. 15% of the public supports this (0% in Kentucky or Tennessee.)

– The other side thinks children should have enough food so they can grow up strong. (85% of the public supports this.)

– A Grand Bargain is reached in which they agree to kill everyone in Tennessee and spare the people in Kentucky, and children will get half as much food as they need.

The DC pundits will say that since everyone is angry at this, it must be the right solution because “both sides” only got part of what they want.

Desperately seeking approval

~ susie ~ 2 Comments

And of course the Republicans will slam Democrats with ads as “the party that wants to cut Social Security”! Krugman:

Sigh. So Obama is going with the “chained CPI” thing in his latest proposal — changing the price index used for Social Security cost adjustments. This is, purely and simply, a benefit cut.

Does it make sense in policy terms? No. First of all, there is no reason to believe that the chained index is a better measure of inflation facing seniors than the standard CPI. It’s true that the standard measure arguably understates inflation for the typical household — but seniors have a different consumption basket from the young, one that includes more medical expenses, and probably face true inflation that’s higher, not lower, than the official measure.

Anyway, it’s not as if the current level of real benefits has any sacred significance. The truth — although you’ll never hear this in Serious circles — is that we really should be increasing SS benefits. Why? Because the shift from defined-benefit pensions to defined contribution, the rise of the 401(k), has been a bust, and many older Americans will soon find themselves in dire straits. SS is the last defined-benefit pension still standing — thank you, Nancy Pelosi, for standing up to Bush — and should be strengthened, not weakened.
Continue reading “Desperately seeking approval” →

Obama’s grand bargain is here

~ susie ~ 5 Comments

It’s official, folks. The Grand Bargain is here.

Time to take action. If we don’t unleash holy hell, this will go through.

Even though I’ve been warning you for a long time, it’s still hard to believe that a Democratic president is offering up the crown jewels of Democratic policy — and for a mere pittance. We need to fight back. You can call your congressperson or the White House if you want, but it’s most useful to start with your senators. Tell them you’re not willing to starve Granny to make the Republicans happy.

We should concentrate on the Senate, because they’ll probably send a bipartisan bill to the House in order to bypass Boehner’s Hastert rule. Even if you called last week, call today. Be prepared to call every day for the next week. (Here’s the link.)

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.

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 A. Boehner (R-Ohio) last December in the discussions over the “fiscal cliff” – which included $1.8 trillion in deficit reduction through spending cuts and tax increases.

“The president has made clear that he is willing to compromise and do tough things to reduce the deficit,” a senior administration official said, “but only in the context of a package like this one that has balance and includes revenues from the wealthiest Americans and that is designed to promote economic growth.”

The Huffington Post has more

The specifics are as follows:

  • The budget would reduce the deficit by $1.8 trillion over ten years — $600 billion of this reduction would come from revenue raisers, and $1.2 trillion would come from spending reductions and entitlement reforms;
  • It would change the benefit structure of Social Security (chained-CPI);
  • It would means test additional programs in Medicare;
  • All told, it would include $400 billion in health care savings (or cuts);
  • It would cut $200 billion from other areas, identified by The New York Times as “farm subsidies, federal employee retirement programs, the Postal Services and the unemployment compensation system;”
  • It would pay for expanded access to pre-K (an Obama priority) by increasing the tobacco tax;
  • It would set limits on tax-preferred retirement accounts for the wealthy, prohibiting individuals from putting more than $3 million in IRAs and other tax-preferred retirement accounts;
  • And it would stop people from collecting full disability benefits and unemployment benefits that cover the same period of time.