Tag: 2012

…the most plausible deficit reduction plan is to rely on gridlock rather than cooperation. Obama yesterday held absolutely firm in his opposition to extending tax cuts on income over $250,000. If Obama won’t relent, then Republicans probably won’t relent on the rest of the tax cuts, and the whole thing will expire. And then, if Obama wins reelection, he’ll be most of the way toward a sustainable deficit, and the Republicans will have had their triumphalism beaten out of them. At that point, a deal to raise a little revenue by reforming the tax code plus spending restraint would be far more plausible.

Jonathan Chait, seemingly forgetting the part where Obama gets to campaign on the GOP eliminating tax cuts for the middle class because they weren’t getting tax cuts for the very richest of the rich. Who, you know, only destroyed the global economy and aren’t the most popular folks electorally. But by all means, GOP, campaign on an all fat-cat ticket. It’s working out great so far in the Midwest.

The Marker

Obama: In December, I agreed to extend the tax cuts for the wealthiest Americans because it was the only way I could prevent a tax hike on middle-class Americans. But we cannot afford $1 trillion worth of tax cuts for every millionaire and billionaire in our society. And I refuse to renew them again.
Kevin Drum:Question: is Obama laying down a marker in hopes of getting a bill that extends only the middle-class cuts? Or is he laying down a marker knowing that Republicans will refuse to budge and therefore the entire Bush tax cut package will expire?
Lemkin: He is putting the onus of middle class tax cut extension or expiration squarely on the GOP House, which is where it should have been all along. We would have had a very different outcome last time around if this had been the shape of the negotiation. There is very real power in pursuing a “do nothing” approach if Obama and the Democrats at large will just deign to use it. Shrill, I know, but following such a path would really punish the GOP and force them to come out squarely against their own stated goals again and again and all in defense of the very richest people on the Earth.

Beating a Dead Hobby Horse

jeffmiller:

[…]Challenged to produce an actual plan, Obama produced rhetoric.  

As opposed to Ryan’s plan and its magical unicorns based solutions? Honestly and specifically please detail exactly which programs and federal initiatives Ryan is specifically cutting to get spending to 3% of GDP? Are you aware that current military spending is all on its own consuming about 3% GDP? It’s no coincidence that the only specifics in Ryan’s plans are the tax cuts to the wealthy and the functional elimination of Medicare and Medicaid. That’s all he cares about. Deficits don’t even enter into it; that’s why the plan so brazenly doesn’t even bother to pretend it’s really lowering deficits. Only the math addled beltway media seems to think it will do anything but increase deficits. Instead, Ryan’s plan is all about undoing a social contract that’s been in place for nearly a century. Anything else that happens, any outcome for good or ill is simply window dressing and utterly unintentional. The elder poor will kindly go die in the streets, as the plutocrats need that money.

[…]

Obama is different president than I expected him to be.  I expected him to be a pragmatic crusader, but he’s not really that.  Were he a crusader, he’d better exploit his bully pulpit.  

Clinton, I think, was driven by power.  Obama doesn’t seem that interested in power … he’s more interested in importance.  Or rather, I think Obama wants to feel important. Wielding power is one way to feel important, but so is talking about wielding power.  And lest you think that talk isn’t important, remember that our warmongering President won a Nobel Peace prize as a result of his talking.  I think that prize was terrible psychologically for our President, in the same way that our election was terrible for him too.  He was elected without actual achievement, and he was given a Nobel Prize without actual achievement … naturally, he’s learned that actual achievement isn’t that important.  That’s not a good lesson for a President to learn.  

Sorry, but this is simply horseshit. Obama won a Peace Prize because of his talking? I’m fully aware that he has no negro dialect, but Barack Hussein Obama won a Peace Prize because he’s a black man who was elected President of the United States of America, which only 150 years ago fought a war over the “states’ rights” to allow its citizens to own other human beings who just so happen to share an ethnic background with Obama. He furthermore won that election by means of the first non-plurality (e.g. true majority election) that’s occurred in this country in decades. This apparent non-achievement was deemed utterly impossible and was the subject of utter “no Serious Person can believe this is possible” derision as recently as 20 years ago when Jesse Jackson was running regularly. But, yeah, total non-event.
And, oh my stars, a Peace Prize recipient is presiding over killing and wars! To the fainting couch! I’m sure they’ll get around to the W Bush statues in our new and wonderful Peace Spring Eternal Middle East any day now.

All that aside, maybe it’s escaped your memory that Obama was also elected a United States Senator. Now that’s suddenly not an actual achievement? I guess ACORN rigged it up for him then too. But which high national office did George W. Bush hold before being elected President? Clinton? Jimmy Carter? Gerald Ford? I must be forgetting all their reams of national-level elected experience before landing the top job.

Finally, and most importantly, anything Obama proposes as “deficit policy” is actually unnecessary. While his plan includes specifics, why even bother? Leaving aside that the GOP House will simply shitcan his stated preferences as a starting point (even if said stated preferences are/were the GOP priorities of that morning), please do recall that doing nothing at all will largely solve this issue in short order. Thus Obama can sit back, veto extensions of the Bush tax cuts and watch the budget come into balance. Period. Or, using parts of the Bush tax cuts as leverage, he can perhaps shape some sort of policy compromise that suits his desired outcome.

And that’s the key. His desired outcome. If we’ve learned anything about this President, it’s that Obama is interested in outcomes. He could care less about tilting at preferred policy windmills, plaudits, power, and most problematic of all: the credit for any of it. For example, Obama has lowered taxes and reduced the size of government, but seems to be going out of his way not to tell anyone. Most polls show people believe the opposite is true on both counts. Even more importantly, though, his administration managed to pass the ACA, which likely will prove to be the single most important legislative achievement of my lifetime when all is said and done.

But, yeah. He’s not achieved anything.

I’d advise you to get some new hobby horses. These are very tired indeed. Maybe try “where’s the long form!?!” on for size.

Rightward Lurch

And so it begins:

Obama will not blaze a fresh path when he delivers a much-anticipated speech Wednesday afternoon at George Washington University. Instead, he is expected to offer support for the commission’s work and a related effort underway in the Senate to develop a strategy for curbing borrowing. Obama will frame the approach as a responsible alternative to the 2012 plan unveiled last week by House Republicans, according to people briefed by the White House.

Just as we predicted a few days ago, your choices, the entire extent of the debate will be between a center-right proposal (Simpson-Bowles) and a far-right proposal (Ryan plan). Where do you think the Serious Person “sensible middle ground” will be in that fight? Left unsaid will be any discussion of the true driver of deficits: individual healthcare costs. Left unsaid will be: if we had individual health costs of any other Western democracy we’d be facing surpluses and not deficits. Limit rate of growth in healthcare and you fix everything we’re currently fighting over, and without doing it on the backs of the poorest.

It’s now down to just how much of Medicare we will eliminate (er: “privatize”) and what percent of older Americans still get access to it. Then, a couple of years down the road: fewer. In a few more years: gone, because it only serves the poor and they don’t vote. Legislative inertia is literally the only chance that program has for survival.

The old will kindly go die in the streets.

As Ezra Klein suggests, all economic conversations should begin (and end) with this graph. If we do nothing, the budget comes basically into balance:

But nothing is hard to do. This nothing, for instance, includes three crucial elements: (1) All the Bush tax cuts expire, as they’re currently scheduled to do; (2) The Medicare doc fix is either implemented or its repeal is paid for over the next 70 years; and (3) the Affordable Care Act is implemented, and all of its spending targets are met and all of its taxes are collected.

I’ll wager 1 million dollars that this topic or any discussion even remotely resembling it comes up exactly zero times in Obama’s Wednesday remarks.

It’s short, it’s simple, it’s understandable, and it’s true. All good reasons it won’t be used to bludgeon the GOP in the run-up to 2012.

Medicare and the Overton Window

This Pelosi post got me thinking about just what a Democratic response to a Ryan-style plan on Medicare should even be. After all, if you work from Ryan’s far right starting point and counter with “well, let’s just privatize x% of Medicare for this set of individuals” or some other “sensible middle” type compromise, then you’ve already lost. You’ve advanced the GOP’s idea of the program (which is a bad one) significantly and at the expense of the better solution: Medicare as it stands or Medicare plus substantial improvements.

It is a fact that the real driver of deficits in this country are healthcare expenses. Don’t take it from me, here’s the CBO’s report (PDF link):

Medicare and Medicaid are responsible for 80 percent of the growth in spending on the three largest entitlements over the next 25 years and for 90 percent of that growth by 2080.

But if we could achieve the per patient healthcare cost of most of the other developed nations in the world, we’d be facing yawning surpluses in this country, not deficits, and we’d very likely have better individual health outcomes to boot.

Therefore: the Democratic response to Ryan’s “privatize Medicare” should in fact be: Medicare For All. Period. We don’t want to reduce this program. Like 87% of all Americans, we think it should at the bare minimum stay just as it is. Preferably, we’d like to massively expand it. This has the dual benefit of covering medical expenses for everyone in the country and relieving the number one deficit driver in the economy: everyone’s medical expenses. Plus this means we eliminate the dread ACA and its totalitarian horrors. Everyone wins!

Now, of course, I don’t really think Medicare For All has any particular chance of becoming law; what using this sort of proposal does do is set the limits of the debate more appropriately and in ways that tend to favor outcomes preferable to the Democrats.
On the right: Eliminate Medicare and let the wealthy fend for themselves.
On the left: not only keep Medicare, but make it the healthcare provider for all, with tremendous humanitarian benefit but also knock-on budget benefits.
Then you’d be down to arguing about whose plan actually saves more money long term and how that impacts health outcomes in America. Which is precisely where the debate needs to be.

Never. Is never good enough for you?

Nancy Pelosi on when the Democratic plan to destroy Social Security would be introduced. This is the sort of Democrat we need a whole lot more of.
And, as Atrios notes, the Bush administration hadn’t yet even offered their plan and wouldn’t, really, until after the whole thing was effectively dead. They were, in fact, counting on that Defeatocratic impulse to get out there and co-own a truly terrible idea just because the Serious People wanted them to. For once, they didn’t do it. That’s true leadership.

It’s Courageous To Go Die in the Streets

David Brooks:

Today, Paul Ryan, the Republican chairman of the House Budget Committee, is scheduled to release the most comprehensive and most courageous budget reform proposal any of us have seen in our lifetimes….His proposal will set the standard of seriousness for anybody who wants to play in this discussion….This budget tackles just about every politically risky issue with brio and guts….Paul Ryan has grasped reality with both hands. He’s forcing everybody else to do the same.

Kevin Drum responds:

Courageous. Serious. Gutsy. I imagine that within a few days this will be the consensus view of the entire Beltway punditocracy. A plan dedicated almost entirely to slashing social spending in a country that’s already the stingiest spender in the developed world, while simultaneously cutting taxes on the rich in a country with the lowest tax rates in the developed world — well, what could be more serious than that?

I think I’m going to be sick.

He’s right, but it didn’t take a few days and it’s not just Our Punditocracy; here’s the generic Democrat legislator last night on Hardball (sorry, no transcript yet):

[it was] “courageous” [for Paul Ryan to put up a plan to abolish Medicare and other federal social programs]

This is deadly serious. It’s easy to say we drugged bloggers out here are simply another example of the smelly hippies flying off the handle on something. Rest assured: We are not. You are going to be fighting 100% of the GOP caucus, some non-zero percent of the Democratic caucus (exactly 100% of the Democrat caucus), the entire Beltway elite media, and the do-nothing defensive crouch of the President and his administration heading into 2012. Keep in mind where that “sensible compromise” is going to land when the Overton Window has been set far, far to the right. Every possible outcome other than status quo within the current frame of the debate is going to be a major GOP win, far beyond anything that’s happened in recent political history. And that’s with a Democratic Senate and a Democratic President faced with a politically daunting 87% public approval of either continuing or increasing Medicare coverage relative to today’s levels. This is why they fail.

It’s going to be just like the Social Security fight, only worse: once again, Very Serious People will pretend not to notice that the Republican plan is a giant game of bait-and-switch, dismantling a key piece of the social safety net in favor of a privatized system, claiming that this is necessary to save money, but never acknowledging that privatization in itself actually costs money. And we’ll have endless obfuscation, both-sides-have-a-point reporting that misses the key point, which is that the putative savings come entirely from benefit cuts somewhere in the distant future that would, in all likelihood, never actually materialize. (What do you think will happen when retirees in 2025 discover that their Medicare vouchers aren’t enough to buy insurance?)

Paul Krugman, on the coming Medicare privatization fight. Add to that an administration that has shown zero interest in coming out of a defensive crouch on such issues, even when 87% of Americans favor keeping Medicare as is or increasing funding.
And, just to get a sense of where the MSM and its serious people are going to come down on the issue, you might review how that overwhelming majority of Americans favoring the continuation and expansion of Medicare is played. tl;dr: second to last paragraph, after about 17,000 words on how Americans “flunk” the budget test. Newsflash, CNN: your own poll shows they know that Medicare is relatively costly; however, they see the value of not putting folks over 65 out there on a competitive market with a fixed amount of 2010 dollars with which to try and find care. But, by all means, journalistic integrity means playing up that folks overestimate our outlays in foreign aid as a cudgel against their views on (and apparently clear understanding of) Medicare funding. Might those sad rubes out there in the many diners of flyover country be conflating military spending with “foreign aid?” We shall never know.
It aint going to be pretty.

Welcome the Responsibility

E.J. Dionne posits that the coming “Ryancare” enforced destruction of Medicare will either be Obama’s defining moment or the final end of progressive government in America:

Americans are about to learn how much is at stake in our larger budget fight, how radical the new conservatives in Washington are, and the extent to which some politicians would transfer even more resources from the have-nots and have-a-littles to the have-a-lots.

And you wonder: Will President Obama welcome the responsibility of engaging the country in this big argument, or will he shrink from it? Will his political advisers remain robotically obsessed with poll results about the 2012 election, or will they embrace Obama’s historic obligation — and opportunity — to win the most important struggle over the role of government since the New Deal?

And that’s exactly what this is. If you “privatize” Medicare, you are in effect creating a real live death panel for those individuals who cannot afford to pay the difference between the arbitrarily low payments (pegged to the dollar circa 2010) that will be made in the name of “cost containment.” Scare quotes there because such a move is categorically not cost containment; it is payment containment, or total government outlay containment, if you will. Costs will still rise, whether that rise is at the rate of inflation or at some other rate doesn’t really matter: the payments are locked, now and forever, to roughly today’s value. It is therefore only that fraction of individuals that are capable of paying the difference between real cost and subsidized value that will be “contained.” This number of individuals will, of course, be diminished day by day, year after year after year, as the subsidy represents lower and lower actual healthcare buying power. This is how Ryancare “works.” Hope you’ve been rather aggressive and uniformly successful with your by then privatized “Social Security” 401(k). Because you’re going to need it. Cat food doesn’t buy itself, after all. Otherwise, kindly go die in the streets.

In a decade or two, yes, even the very wealthy will begin to feel that pinch and there might be some movement to address the issue. But, by then, assuming all goes to Ryan’s master plan, tax revenue will have ratcheted to such historic lows (the other part of this “plan” is to limit next year’s spending to a fractional percent of the previous year’s, regardless of inflation and actual vs. projected economic output or overall economic conditions) that the federal government will have drowned itself in a teacup and will be laughably incapable and plainly impotent relative to doing anything about it. Problem solved! Think of how free we’ll all feel on that wonderful day!

And but so: do I think Obama will rise to this particular challenge? No I do not. Nothing coming out of the administration leads me to believe he or his advisers have any interest whatever in fighting for the future of Medicare, much less Social Security (which, having its own funding source, is utterly secure for decades to come: so Serious People all know that we must act now to destroy it because otherwise it won’t be there! This makes sense to our Beltway Punditocracy.). The administration and, by and large, The Body Democrat will remain in their defensive crouch, trying not to “screw up” 2012 with a lot of progressive mumbo-jumbo, because, as any Serious Person can tell you, those dozens of Tea Partiers that showed up in DC the other day are the ones that run the country, now and forever, without any regard to election results, polling data, or the stated wishes of the American People at large. Those 100k that showed up in the tundra of Wisconsin? Just out of town Union thugs. No reason to pay attention to them at all. They’ll only win in 2012 if ACORN steals the election for them.

Welcome the Responsibility