Obama Leading from Behind on Entitlement Reform
Both the Wall Street Journal and the Washington Post report this morning that the White House will significantly scale back the entitlement portion of the deficit reduction platform the Administration plans to offer next week – for largely political reasons. From the Journal article:
President Barack Obama’s new deficit-reduction proposal will leave out changes to Social Security, and may exclude any increase in the Medicare eligibility age, people familiar with the discussions said Wednesday….
Changing the inflation formula so Social Security benefits grow more slowly and raising the Medicare eligibility age were ideas Mr. Obama had been willing to accept this summer….[However,] Democrats, who believe it is strategically unwise to put forward a compromise position at the outset, have urged that Mr. Obama not include them in the new deficit plan he is set to unveil Monday….
The Social Security and Medicare provisions that Mr. Obama was willing to agree to with Mr. Boehner drew criticism from members of Mr. Obama’s own party, who oppose the policies. White House officials worry that including them in his plan now could overshadow the president’s focus on jobs. Democrats also fear he will be forced to concede even more in later negotiations.
They argue that by proposing controversial changes to entitlement programs, Mr. Obama could undercut Democratic arguments against the GOP on these points in 2012.
Both the Journal and the Post pieces cite Administration sources as repeating the old saw that Social Security is not running deficits. However, this claim has already been thoroughly debunked by the non-partisan factcheck.org. The fact is both Social Security and Medicare are running cash-flow deficits – the only thing allowing full benefits to be paid out are the paper IOUs in the respective government trust funds, and when the government cashes in those IOUs, that adds to the deficit. Medicare alone is projected to run a deficit of more than $39 billion this year – and will NEVER achieve balance, running deficits as far as the eye can see. (By point of comparison, Greece ran a budget deficit of only about $35 billion in its most recent fiscal year.)
President Obama was dragged into a debate on entitlements this spring, after Republicans put forward a comprehensive reform platform. The Administration’s only “substantive” contribution to that debate thus far has been a press release that was publicly derided by the head of the Congressional Budget Office as not being detailed enough to receive serious consideration. Now the President is backing off a bold approach to tackling the entitlements driving our debt, because members of his own party are more interested in scoring political points and winning re-election than solving America’s fiscal crisis.
The question now is this: Why is the President asking for “No games, no politics” on his “jobs bill,” when that’s EXACTLY what he’s doing on entitlement reform? And do Democrats think America’s fiscal crisis should wait for another 14 months so they can win re-election?