Democrats toughen stance on trimming benefits

ANDREW TAYLOR, Associated Press

Sunday, November 18, 2012

WASHINGTON (AP) — President Barack Obama's re-election has stiffened Democrats' spine against cutting popular benefit programs such as Medicare and Social Security. Their new resolve could become as big a hurdle to a deal that would skirt crippling tax increases and spending cuts in January as Republicans' resistance to raising tax rates on the wealthy.

Just last year, Obama and top Democrats were willing during budget negotiations with Republicans to take politically risky steps such as reducing the annual inflation adjustment to Social Security and raising the eligibility age for Medicare.

Now, with new leverage from Obama's big election victory and a playing field for negotiations that is more favorable in other ways, too, Senate Majority Leader Harry Reid and other Democrats are taking a harder line.

"I've made it very clear. I've told anyone that will listen, including everyone in the White House, including the president, that I am not going to be part of having Social Security as part of these talks relating to this deficit," Reid, D-Nev., told reporters.

Reid's edict would appear to take a key proposal off the table as an ingredient for a deal on avoiding the "fiscal cliff," the year-end combination of expiring President George W. Bush-era tax cuts and harsh across-the-board spending cuts.

At issue is the inflation adjustment used by the government to calculate cost-of-living adjustments for Social Security and other federal programs. A less generous inflation measure that takes into account consumers finding alternatives when prices go up could reduce deficits by more than $200 billion over the next decade.

It's a no-brainer for many budget wonks because it means gradual, less noticeable curbs to the growth of benefits. It also means about $70 billion more tax revenues over 10 years because automatic rises in tax brackets to account for inflation would be smaller.

That new inflation index, known as chained Consumer Price Index, is a magic elixir for budget writers. But it's anathema to many liberals, who say that moving to the new cost-of-living measure could cut average retiree benefits by about $600 a year a decade after taking effect and mean a cut of about $1,000 a year after 20 years.

"Think about it this way. You're standing on the deck of a boat and you're in very deep water and they want you to swim, but they're going to put a log chain around your ankle," Sen. Tom Harkin, D-Iowa, told a group of liberal activists assembled for a rally Thursday in a Senate hearing room. "That's chained CPI."

Sixteen months ago, Obama's White House took a different view during talks with House Speaker John Boehner, R-Ohio, on a possible budget deal. A White House draft offer by top Obama aide Rob Nabors, made public by Washington Post author Bob Woodward, proposed several controversial changes to benefit programs, including the lower inflation adjustment, raising the eligibility age for Medicare and higher Medicare premiums.

Those negotiations, however, were conducted on a playing field that favored Republicans. It was less than a year after Obama's self-described "shellacking" in the 2010 elections and the president was desperate to win an increase in the government's borrowing cap and avoid a government default on its debt that should shatter financial markets. Also, Obama still faced re-election in 2012.

Now conditions favor Obama.

He decisively won re-election and Republicans seem fearful of being tagged with the blame if an impasse results in the government going over the fiscal cliff. Obama and Democrats already are portraying Republicans as hostage-takers willing let tax rates rise on everyone if the lower Bush-era tax rates are not also extended for the top 2 percent to 3 percent of earners — those with incomes above $200,000 for individuals and $250,000 for joint filers.

The new balance of power means that Democrats who once would have acquiesced reluctantly to GOP demands for stiff benefit cuts are now balking at ideas such as chained CPI or an increase in the Medicare retirement age, as well as demanding GOP concessions to higher taxes.

"The price for that kind of thing has gone up," said a senior House Democrat who required anonymity to speak frankly on party strategy. "Negotiations depend on the situation. No one should expect to get the same kind of deal."

Republicans have gotten the message, but insist that higher tax revenues be paired with cuts to rapidly growing programs such as Medicare and the Medicaid health care program for the poor and disabled. These programs are called "entitlements" because eligibility is based on meeting criteria such as age or income.

"Washington's problem isn't that it taxes too little, but that it spends too much," said Senate Minority Leader Mitch McConnell, R-Ky. "But in a good-faith effort to make progress on boosting the economy and government's long-term solvency, Republicans like me have said for more than a year now that we're open to new revenue in exchange for meaningful reforms to the entitlement programs that are the primary drivers of our debt."

New Hampshire Sen. Kelly Ayotte said in the GOP's weekly radio address Saturday that "any effort to address our fiscal crisis without including entitlement reform can't be taken seriously."

No way, say many liberals.

"We're going to send a loud message to the leadership in the House, in the Senate, and President Obama: 'Do not cut Social Security, do not cut Medicare, do not cut Medicaid,'" said Vermont Sen. Bernie Sanders, a self-declared socialist who aligns with Democrats. "Every now and then elections have consequences. We won."

Republicans and even some Obama allies worry that liberal demands will make it harder for the president to seal a bargain with the GOP.

Rep. Mike Quigley, D-Ill., said Obama has the same problem with his party's liberal base that Boehner has with some conservative Republicans. "Boehner has a disproportionate group of his folks skewing things too far out," Quigley said, "and the president has equally the same sort of problems with people who are horribly unreasonable."

More like this story

Crump 6 months ago

That's great. How are they going to pay for all this BS?

connor 6 months ago

OOOO 70 billion more in tax revenues over the next 10 years? These Liberal quacks are simply brain dead. 70 Billion doesn't even cover the bond yields and interest for a year. They are going to run deficits and pump money until the world has no faith in the dollar much like 51% of the country has no faith in Democrat vote counting, or another segment of the world finances offers something viewed as safer than US bonds.

When that happens it is over and at this point we will be better off.

eileen10 6 months ago

Okay. After what I read I'd like to kick Obama in the arse. I never said I liked everything but this has my eyes crossed. I don't feel people who are barely getting by should be dumped on. And it's not just the seniors who are having a hard time. Eventually I may change my mind about him. I'll sit back for now to see what happens. It's to soon to really form an opinion.

connor 6 months ago

He doesn't need you anymore. He can join Holder and just think about "My People" Now.

eileen10 6 months ago

The way I figure it if he goes to far over board what Graceful said could actually happen. Abig uprising and I really don't think he wants that to happen.

connor 6 months ago

I am not so sure he doesn't honestly. The Libs have been pushing for Global government for a while now. I wouldn't put em past thinking a little secessionistic rioting wouldn't be a good time to try and move a bit further towards that goal.

eileen10 6 months ago

I don't know. That's why I'm going to sit back and see what happens. There may be more info so I'm not going to jump the gun.

Paroquet 6 months ago

Racist much? -sniffs- you aren't a Birther too, are you?

I gotta deal, and I don't want any president to fail.

As for a purportedly looming civil war, heard all the threats (or read them). Here's what I want to see--I want to see them try.

Didja know that most ballistic body armor ain't rated for arrows? Might want to look into it. DOC has a supplier I understand.

I am not one that takes overly well to sabre rattling. It's pretty low-brow.

connor 6 months ago

No Need to be racist the President and his administration, not to mention his followers, are racist enough for all.

Funny thing about the latest secession talk. Never really ever heard it before this election fraud cycle. I would take it seriously because each day it grows. Eventually the racist move of importing more Democrats will mean there is no other option. There are a few other moves the Libs want to make that will bring on the same reaction when/if they do.

16 gauge mild steel backed by relatively thin layered felt will stop any arrow even if you use a modern compound bow with an actual European armor piercing point and a steel shaft. Believe me I have tested it numerous times.

Anytime one of you libs tells someone to leave the country if they don't like it I will tell them to leave the state. It is that simple.

spelchek 6 months ago

"Racist much?" -- How quickly we forget.

"I mean, you got the first mainstream African-American who is articulate and bright and clean and a nice-looking guy," Biden said. "I mean, that's a storybook, man."

spelchek 6 months ago

"I think that they played the race card on me. And we now know, from memos from the campaign and everything that they planned to do it all along," Bill Clinton said in a telephone interview with WHYY’s Susan Phillips. "I was stating a fact, and it’s still a fact."

connor 6 months ago

As for being a birther, well the story for Obama's birth doesn't add up with some known facts or at least reported dates especially with his Mother's college attendance and enrollment. He has shown me that the United States should require a bit more information on candidates and perhaps a limit on foreign ties but I am not sure how that could be worked out.

Although his stories are about as questionable as some of yours and I believe you were born here so maybe I am wrong.

eileen10 6 months ago

I've never doubted that he's a citizen and yesterday I was kind of upset but when I woke up this morning I remembered what JFK said. " Ask not what your country can do for you, ask what you can do for your country." There are many thoughts and feelings swirling right now and with good reason but as I said before I'm going to wait to see what happens and which ever way it goes I'll be okay with it. And as always this is how I feel. If SSand medicare are cut maybe people will hit the streets and protest. We did a lot of that in my day. I hope it would be a peaceful gathering if it comes to that but again, we don't know anything yet.

3633 6 months ago

Let's all wait and see what will happen, both groups must do their job, just as all other people who have jobs!!!!

asb 6 months ago

To secede you'll need a new army 'cause the US Army won't be there for you. How to pay for that new army and still have paved roads and electricity . . . well there's always taxes. Yes, secession talk is quite a novel reaction to losing an election in my experience, and when you can document more than a handful of "imported" electors, you might bring down the popular vote to only the 2nd largest margin in decades, but this is silly. Only bigotry can explain this talk, or wait, there's always years of pent up FRight Wing hate needing an outlet. But if you think states with big secession petition counts would actually listen to their frightend extremists, and give up the benefits ($$$$) of the union, you must be used to listening to FOX Fairytales For Adults. Secession, Birthing, Secret Muslim President. Trump has his audience all foamed up with nowhere to go . . . but please go. People still holding to this idea that they've had an election stolen from them, and that the national will isn't for an immediate adjustment to revenue to fund the still-greatest nation in history, are losers. Sore losers. TeaParty = Losers.

connor 6 months ago

Here is a fine example of Cleftwing blindness. The Tea Party was so three years ago and you Liberals are still so afraid of it you can't even write one of your classic "Your racist" comments without bringing it up.

I guess you haven't noticed but the Tea Party turned into the Conservative movement. That would be those 30 states with Republican governors and the other 6 or so with Republican "veto proof" legislatures, like Missouri.

Like the secession idea the cleftwing ideology just started. The Tea Party sparked and then grew and is now something different. It has spread over the country. The Republican party will either embrace it or not but the movement will continue to grow. Your divisive purchase the vote politics assure it.

I understand movements based on something other than immediate satisfaction and gimme more welfare is an alien concept to to you Libtards. It will sink in eventually.

Sequoia 6 months ago

Connor, you and Spel have been consistently wrong. Nothing happens the way you say it is. All your predictions turn out to be incorrect.

A batter who always strikes out doesn't stay in the Majors for very long.

A wind that blows loudly is soon exhausted.

You guys are always wrong. So why should anyone listen to you?

spelchek 6 months ago

...and you call Obama a centrist and conservative. Nothing "wrong" about that.

Sequoia 6 months ago

Can we quit listening to the chumps in the conservative movement?

This article says it nicely: Tax cuts and spending cuts do NOT lead to economic growth. Connor and Spel and seling self-serving hokum that is plainly WRONG.

If I was always this wrong, my sense of shame would push me to try to get it right. Connor, Spel, and the conservative movement are so invested in their ideology that they can't admit they are wrong. But we don't have to listen to them.

theatlantic.com/politics/archive/2012/11/the-next-chapters-in-the-republican-war-on-math-tax-cuts-and-austerity/265332/

Quote:

"There are two math fallacies affecting the current economic debate. First, Republicans continue to argue that tax cuts for the wealthy are key to growing the economy, despite solid evidence to the contrary. This argument is their primary objection to allowing President George W. Bush's tax cuts on the wealthy expire at the end of the year.

The facts fly in the face of their argument. We know what happened in the 2000s after the Bush tax cuts: Despite the supposedly job-creating tax breaks, our economy experienced its worst record for growth in investment, employment, and incomes in half a century, an outcome devastating to our middle class.

Yet Republican leaders are working to make sure that the math fits their version of reality, rather than actual reality. As the New York Times has reported, the Congressional Research Service, a non-partisan arm of Congress, was forced by Republican leaders in the Senate to withdraw an economic report showing "no correlation between top tax rates and economic growth."

Getting the math right about the effects of tax cuts on our economy is a priority given that the national conversation has now turned to whether these tax cuts should be extended. If Nate Silver was an economist, he would aggregate all the studies that show that more tax cuts for the wealthy will not grow the middle class. Fortunately, others have looked at the data and found just that.

A second example of math denialism is the notion that sharp cuts in spending to eliminate a budget deficit when an economy hasn't fully recovered from a deep recession will lead to robust economic growth and job creation. Both economic theory and recent experience in countries that have gone down the austerity path show that this perspective is willfully in denial of empirical reality. Countries that have been implementing austerity packages are now teetering toward, if not already in, recession."

spelchek 6 months ago

Oh Sequoia...please explain why a Dem controlled congress didn't end the hedge fund loophole when they had the chance. That magical "15%" tax rate for the rich could have increased on the extremely rich but didn't....why? Why has the house passed two bills to the senate to end the loophole but always seems to die. To think conservatives are the only ones owned by the rich is simply naive and dishonest.

cimarron 6 months ago

Has everyone forgotten the coined phrase "Permanent Majority"?

connor 6 months ago

Talk about math denialism. The cleftwing spenders can't even seem to add enough to figure out no amount of taxes on what remains of the productive class will ever fill the gaping hole of spending they have created. Whats the figure now? 70 Billion over 10 years? You figure it out.

As for being wrong so far I haven't been wrong at all. Your election was a farce with 108 to 141% turnouts and zero Romney votes in those non-Id urban areas along with continued importation of mercenary democrats that you have to pay for now. Unless some other natural occurring event stops it secession in one form or another will be the end result. The Liberal left just put that ball into play and now it frightens them.

These Democrat early voting and make believe voter tactics allow them to capture the National election but the strategy is flawed because they are losing the states and the House which was another side effect I predicted some time ago as well.

The bigotry comes entirely from the Left. They celebrate the so called end of the White Male and help it in anyway their little racist minds can conjure. All the while forgetting like they always do the cause and effect aspect which taken as a whole only bleeds the country dry.

I will give another prediction here though. Nothing much is going to happen from Obama for the next four years except more deficit and increased decline but your boy isn't going to do anything to stop it. He doesn't need you anymore and your messiah didn't become President for your ideals, he became President for his narcissism. His weak dovish foreign policy may force his own hand but if it does by the time he actually does anything it will be too late. The only plan he has is to jet all over the world and hang with celebs and funnel money to his big union supporters. Oh he will let the other libs like Fienstien play at putting Cleftwing policies into action but he won't really help it along.

We will see.

asb 6 months ago

You don't have a new country guys . . . you have a conservative state with no interest outside the tiny collection of wacko you think are legion. I'm not leaving Lifer, Nobody is leaving; that's the point. It's phroo phroo from the Losers, disengage or risk toxic embarasment

JCLifer 6 months ago

Oh, some will leave when it gets hot enough.

Sequoia 6 months ago

We will see. Here is what we're seeing now:

krugman.blogs.nytimes.com/2012/11/17/transatlantic-divergence/

The U.S. is recovering far better than the European countries with their "austerity measures."

We're on the right track. Now is not the time to panic.

connor 6 months ago

UH HUH France's Non-Austerity drive lasted what? Two Months? Then they were back to admitting a revenue problem. Any growth we are seeing is entirely smoke and mirrors. It just means the credit card hasn't come up declined yet. It will eventually.

connor 6 months ago

And talk about following media talking points. Krugman is worse than Glen Beck and the Atlantic is like reading Michael Savage.

JCLifer 6 months ago

Don't you know that we have to tax ourselves into propserperity?

connor 6 months ago

OIC Krugman is out and about today with one of his fantasy economic stories. I know Sequoia likes "her" Cleftwing talking points flavored with a little feminized beta-maleness so it all makes sense.

Apparently the new agenda is that in the 50's income tax rates for the wealthy were up to 91% although there is some question as to the actual rate on capitol gains.

Typical revisionist, take what looks good to you, Liberal dogma.

Lets go back to the 50's in welfare/entitlement spending, actually use increased taxes to pay off the debt for a change and destroy all manufacturing ability in China, Europe, Japan and Russia. Oh and send all the Hispanic immigrants back to Central and South America.

Once we do that we may have a 50's like environment and these Liberal talking points Sequoia goes over each weekday morning might be valid.

These Liberal pundits don't even have brains just pre-programmed redistributive talking points they try and justify with selective revisionist history.

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