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Wednesday, May 16, 2012

Runaway train on entitlement cuts?

by digby

I think it's going to happen this time:
At the Peter G. Peterson Foundation’s 2012 Fiscal Summit, there was a clear difference between Democrats and Republicans: Democrats talked constantly about how they should be talking about entitlements. Republicans reiterated their position that they won’t talk taxes.

“Our party’s problem is, we are always reluctant to give up the gains of the past to create the future,” Bill Clinton told the audience at the Pete Peterson’s fiscal summit. “Democrats are reluctant to commit to longer-term health-care savings; they don’t want to touch Social Security.”

Clinton went on to attack Republicans for becoming a far more extreme and ideological party, making compromise nearly impossible. But he brought up the same point time and again: “My party is not blameless.”

Rep. Xavier Becerra (D-Calif.), a former member of the supercommittee, echoed the same sentiments at Peterson’s deficit-reduction confab. In responding to legitimate fears that Republicans would privatize or eliminate social services,“maybe Democrats worked too hard to protect those programs from devastating cuts and in doing so, perhaps that has kept us from trying to come up with a smart budget,” Becerra admitted.

Democrats say they took these criticisms to heart during the supercommittee negotiations, initially proposing $400 billion in savings from Medicare — half through benefit cuts and half through provider cuts. Democrats point to such proposals as evidence of their party’s willingness to compromise and incorporate a diversity of views, blaming Republican intransigence for the deficit-reduction talks’ ultimate failure. “We have a lot of people in our party who will not be drummed out if they depart from the conventional wisdom,” Clinton explained.

For all that the Democrats tried to show they were willing to talk entitlements, you didn’t hear any Republicans at Peterson’s fiscal summit saying that they should be willing to compromise more by considering tax increases.

Even when asked point-blank how the GOP was to blame for the deficit crisis, Sen. Rob Portman — Bush’s budget director and another supercommittee alum — avoided any mention of taxes. Yes, he said, the Bush administration could have paid more attention to the long-term fiscal picture. But it was because “after 9/11, particularly ... more was spent on homeland security, defense,” Portman explained. He added that Bush should have vetoed costly appropriations bills from Congress and cut more social spending. What he didn’t bring up: the Bush tax cuts — which have added more than $1.8 trillion to the deficit, more than any single other program under his presidency or Obama’s.

When Republican discuss a fresh approach to taxes, they cast it as “tax reform” that excluded any tax hikes. “What also doesn’t count as ‘cuts and reforms’ are tax increases,” said Speaker John Boehner, declaring that the GOP would refuse the lift the debt-ceiling — once again — until equivalent “cuts and reforms” were passed. (Read Boehner’s full speech.)

CNN’s Erin Burnett prodded Boehner further to see whether Republicans were, in fact, completely unwilling to compromise on the issue. After all, closing tax loopholes and carve-outs — something that the House speaker did promise to do — would presumably result in some people paying more, right?

Boehner stuck to the script, insisting that “lowering rates and broadening the base” was the only acceptable answer. Burnett pressed the question again: “Broadening the base” meant closing loopholes, which meant taxes for some would go up, right? Boehner equivocated. “Yeah, some may pay more and some may pay less,” he said quickly.

I'm afraid we are looking as a scenario in which they'll end up accepting "tax reform" (another word for tax cuts for the wealthy and corporations) in exchange for tax hikes on the middle class and benefits cuts to social security and medicare. And they will strut and puff and knock themselves over patting each other on the back for being "responsible" and doing the "hard work" of screwing the American people, including the most vulnerable, in the middle of a depression and at a time when their futures have never been more insecure. Heckuva job.

I don't know what more to say about this. Voting against them will not stop it. Voting for them will not stop it. So far, public opposition will not stop it. Certainly, there's little reason to believe that the administration will stop it. They brag about their program cutting prowess with charts like these:

Everyone keeps telling me that they will never cut social security and medicare because they're popular programs. One would certainly think that should be true. So can someone please tell me what they have to gain by pretending they want to? Honestly, I don't see it either as a negotiating ploy or a public relations tactic. The only thing I can come up with is that they believe the Village hype that they will be "heroes" for bucking the popular will. And perhaps they will be -- not in the public's mind, of course, but Gloria Borger and Cokie Roberts will think they're just dreamy andPete Peterson and his pals on Wall Street will surely be grateful.

Look, Obamacare cut hundreds of millions from Medicare already (which the GOP also used as a bludgeon against the Democrats in 2010.) The whole point of that Rube Goldberg mess, including the mandate, was to create incentives to lower health care costs over time. The people who are screaming about deficits want to repeal Obamacare which will add to health care costs and raise the deficit. And Social Security is not part of the budget so these people have no business lumping it in with everything else. If they want to "shore up" Social Security, it's a separate issue and could be easily dealt with by making millionaires pay more into the system. If they insist on paying down the deficit in the middle of a depression in which all projections are predicated on the present disaster, they should look to the Pentagon where they are building weapons systems that don't work to the tune of hundreds of billions of dollars. Those we know we aren't going to need.

Democrats know all this. Becerra should have his district offices inundated with phone calls. People should picket and protest. But I doubt it will do any good. They are determined to do this and they aren't being honest about the reasons why. (Either that or they are too stupid to be in elective office and that's saying something.) Bill Clinton is one of the most astute students of the budget in the entire country. He knows very well that he is spouting utter crapola. There is no earthly reason for him to do this except as a reflexive desire to appear reasonable to people who loathe the very air he breathes --- or appease Pete Peterson and his pals. Actually, in his case, it's probably both.

This has the feeling of a runaway train to me. The Republicans have worn them down and they just want to get past the election. Sure, they may get some little token of a tax hike on the wealthy in return. But it will be nothing to the sacrifices that average Americans will have to make. Indeed, this whole formulation is fundamentally immoral --- tax hikes on millionaires in exchange for poor, sick old people having to do with less than their already meager guarantee is disgusting. Couldn't we at least agree to fuck over the sick, old people only as a last resort?

(Maybe we could cut the kids a break too --- at least until the economy can provide them more than a subsistence living.)