State-By-State Impact of Federal Budget Debate
Some members of Congress have suggested benefit cuts to Social Security, Medicare and Medicaid while calling for renewed tax cuts for the richest 2%.
Washington Post (NAT)
High-powered ‘Fix the Debt’ group draws attention, scrutiny in Washington
Fix the Debt is deploying sophisticated political tactics to boost its image and win supporters. The group has been building a grass-roots network and has formed chapters in 17 states, with more due to open soon. The number of corporate members has jumped to 130 from 80 in late October. In addition to Cote, the group’s chief executives include such corporate leaders as Lloyd Blankfein of Goldman Sachs and Mark Bertolini of Aetna. The three were among chief executives and others in Washington on Wednesday for Fix the Debt events on Capitol Hill, which included private meetings with the leadership. Blankfein and other CEOs later went to the White House, where they met with President Obama and other officials. But even as the chief executives — accompanied by Simpson and Bowles — made their rounds, they were preceded and followed by labor advocates offering an opposing view, particularly on changes to entitlement programs. Fix the Debt is classified as a 501(c) nonprofit group, meaning it does not have to release the identity of most of its donors. The president of the organization, Maya MacGuineas, has sought meetings with both liberals and conservatives on an almost daily basis. But Fix the Debt has made limited headway with prominent Democrats and their allies, the open door at the White House notwithstanding.
New York Times (NAT)
Health Care Entitlements
Congressional Republicans are insisting that big cuts to Medicare and Medicaid be on the table in the negotiations over the so-called fiscal cliff and deficit reduction. That stance is largely a political move against two programs, which have been critical to the public welfare for the past half-century. Postelection polls show that large majorities of voters for both President Obama and Mitt Romney opposed making large Medicare cuts as a way to reduce the budget deficit. And, the fact is, the Obama administration has already pledged to extract more than $1 trillion in savings over the next decade from these programs. There is not much more that can be cut without hurting the most vulnerable Americans.
If Peter Peterson Sold Government Bonds to Pay for His "Campaign to Fix the Debt" Did He Add to the Deficit?
According to USA Today, he did. USA Today's editors are hopping mad because people like Senator Dick Durbin keep reminding them of the law which says that Social Security cannot contribute to the deficit. Under the law, the Social Security program is financed exclusively by its own payroll tax. (The exception is the last two years where general revenue was added to make up for the revenue lost as a result of the payroll tax holiday.) It can only spend money raised through this tax either in the current year or from the interest and principal from government bonds purchased in prior years.
IN WHICH ROSS DOUTHAT EXAMINES SOCIAL SECURITY
Charles P. Pierce
Ross Cardinal Douthat yesterday decided that the greedy olds are ripping him off, and he and Chris Van Hollen are not going to take it any more. Or something. In doing so, he masterfully delineated the actual case that conservatives have been making against Social Security since the moment it passed in 1933 — namely, that the biggest problem with the program is that it, you know, really works.
The Hill (DC)
Leave Social Security off the table
For too long, many in Washington have been obsessed with using Social Security’s revenues as the solution for a whole host of fiscal problems that have nothing to do with the Social Security program. Whether it’s cutting benefits in the name of deficit reduction (even though Social Security by law can not contribute to the debt) or diverting payroll taxes to stimulate the economy, these approaches ignore the fact that Social Security is paid for, earned by, and promised to American workers. Thankfully, the White House and many in Congress are finally acknowledging Social Security should not be used as political leverage in Washington’s version of “Let’s Make a Deal” and simply does not belong in this deficit debate. However, as long as the chained CPI and extension of the payroll tax holiday remain under consideration, Social Security is still in the political cross-hairs.
Washington Post (NAT)
Democrats hint at concessions on benefits as ‘cliff’ talks accelerate; GOP may give ground too
“I’ll go anywhere and I’ll do whatever it takes to get this done,” President Barack Obama said as he sought to build pressure on Republicans to accept his terms — a swift renewal of expiring tax cuts for all but the highest income earners. “It’s too important for Washington to screw this up,” he declared. For all the talk, there was no sign of tangible progress on an issue that marks a first test for divided government since elections that assured Obama a second term in the White House while renewing Republican control in the House.
Washington Post (NAT)
Social Security and special commissions
Senate Majority Whip Dick Durbin has floated the idea of a new commission to find a solution for long-term Social Security problems. I’ll leave it to others to debate the merits or lack thereof of tackling Social Security reform now; instead, I’ll tackle the question of procedure: is a commission appointed by the president the right way to get it done? Which comes down to the question of what special commissions are good for, anyway?
The Atlantic (NAT)
Is Our Debt Burden Really $100 Trillion?
And that's if there is a Social Security "gap" to begin with. Technically, it's not legal for Social Security to have "unfunded liabilities" since it can only pay as many benefits as it receives in earmarked taxes. Both it and Medicare hospital insurance are prohibited from spending money they haven't collected from specific revenue dedicated to their programs (i.e.: payroll taxes). It is impossible for either to technically be "unfunded", since they cannot legally outspend their funding.
Democrats to GOP: Hands off Social Security!
Yet, former senator and co-chair of the president’s 2010 debt commission Alan Simpson said on Wednesday that Obama is still talking about entitlement reform. “He will give something in that area as long as he can hammer those guys over $250,000 and make them pay more taxes,” Simpsons said, referring to Obama’s campaign promise to let the Bush tax cuts expire for the wealthiest Americans. Democrats may be hoping to hold off until 2013 to reform entitlement programs as part of a two-step negotiation process that, along with overhauling the tax code, could address the nation’s growing deficit after an immediate set of cuts have been put in place by the December 31 deadline. If Congress fails to meet that deadline, automatic tax increases and cuts to defense and domestic spending will take effec
The Advocate (LA)
Social Security office closing
TERRY L. JONES
PLAQUEMINE — The Social Security Administration is shutting down its satellite office in Plaquemine on Dec. 14 after 37 years of operation, a spokeswoman said. Sarah Schultz-Lackey, regional communications director for the agency, said Tuesday the field office’s closure would save taxpayers about $4 million during the next decade. The Plaquemine Social Security Office, 24655 Plaza Drive, received “very light foot traffic,” Schultz-Lackey said, not enough to justify keeping it open as the agency deals with budget constraints.
National Journal (NAT)
Dems to GOP: Stop Stalling and Name Your Entitlement Cuts
But a Senate Democratic leadership aide said Democrats are open to making a down payment on future spending cuts if Republicans would only tell them what they want.
“The hard line on entitlements is based on the two-step process of don’t do it now, but we are open to it next year,” said the aide, adding that Democrats aren’t going to let Republicans “head fake us into doing entitlement cuts.”
Senate Democrats say they have made their opening bid on the revenue side by pushing House Republicans to approve a Senate-passed bill to extend the Bush-era tax cuts for the middle class while raising tax rates on the wealthy.
Now, Democrats want Republicans to offer up the spending cuts they want to see – a move the GOP doesn’t seem inclined to make right now.
President Obama has argued for a balanced approach to broad deficit reduction that would include spending cuts and tax revenue increases. Now the “question is, what spending cuts will Washington Democrats accept?” said Republican House Speaker John Boehner’s spokesman Michael Steel.
Taylor Marsh (blog)
President Obama Wins Election, John Boehner Decides to Ignore Voters [Video]
IT LOOKS like Speaker John Boehner is taking over where Mitch McConnell started when Obama won his first term. No sooner had the President said he’d sign a deal to extend tax cuts to everyone but the top 2%, then come back after the New Year to work on a broader economic plan, than Boehner told him to get screwed. He just used more diplomatic language. And I don’t know who Erskine Bowles thinks he is, but this guy has now gone well over the line, even suggesting a recession might result if the fiscal cliff scheme isn’t followed.
Washington Post (NAT)
Inside the ‘fiscal cliff’ haggling over Medicare
Some more quick notes about that big Politico piece on what’s going on in the fiscal cliff talks. The piece makes two points about the haggling over Medicare’s future that are worth addressing. First, it says in passing that Dem aides say raising the Medicare eligiblity age is on the table. If true, that would be a nonstarter for the left. But as best as I can determine after talking to Dem aides, this isn’t on the table. It’s something Republicans want to be part of the talks but not one Dems are seriously entertaining, at least for now. Dick Durbin and other Democrats have repeatedly said raising the retirement age is off the table. Obama reportedly signaled openness to it during the 2011 debt ceiling talks, so if some on the left still want to be vigilant about this possibility, it’s understandable — after all, ultimately Dems will likely fall in line behind what Obama wants in the end. But keep in mind Obama was in a significantly weaker position last time and may not see the need to make that concession now. The second, and more interesting, point is that Republicans are insisting that the White House go first in laying out proposed entitlement cuts — and the White House is balking.