Obama to Formally Propose Social Security Cuts
In the name of compromise, bipartisanship and the satisfaction of a ruling class that is indifferent to the suffering of ordinary Americans, President Obama is ready to sell parts of Social Security and Medicare in his attempt to strike an annual budget that satisfies Republicans and reduces the long-term deficit by $1.8 trillion over 10 years, administration officials say.
The New York Times called the move a “political risk,” as if congressional Democrats would not simply bow their heads and go along with the decisions of their leader no matter how antithetical those decisions are to some part of their party’s historic legacy, namely the creation of those programs the president is ready to weaken.
One third of the $1.8 trillion deficit reduction plan — $600 billion — would come as new revenue from tax increases on higher income individuals. That tax increase is half the amount the president called for in an earlier proposal, which Congress has consistently ignored. Deficits would be reduced $930 billion more through 2023 via spending cuts and other acts of ravaging domestic programs. An additional $200 billion would come from reduced interest payments on the federal debt.
The Social Security cuts consist of a reduction in cost of living payments for Social Security benefits.
The president’s proposed cuts include about $400 billion from health programs and $200 billion from other areas. Those include farm subsidies, federal employee retirement programs, the Postal Service and the unemployment compensation scheme.
The Medicare savings would mostly come from payments to health care providers, including hospitals and pharmaceutical companies, with higher-income beneficiaries paying more for coverage.
— Posted by Alexander Reed Kelly.
WAIT, BEFORE YOU GO…
The New York Times:
Besides the tax increases that most Republicans continue to oppose, Mr. Obama’s budget will propose a new inflation formula that would have the effect of reducing cost-of-living payments for Social Security benefits, though with financial protections for low-income and very old beneficiaries, administration officials said. The idea, known as chained C.P.I., has infuriated some Democrats and advocacy groups to Mr. Obama’s left, and they have already mobilized in opposition.
As Mr. Obama has before, his budget documents will emphasize that he would support the cost-of-living change, as well as other reductions that Republicans have called for in the popular programs for older Americans, only if Republicans agree to additional taxes on the wealthy and infrastructure investments that the president called for in last year’s offer to Mr. Boehner.
… Of the more than $2.5 trillion to date in projected 10-year budget savings, nearly 80 percent would result from spending cuts. The rest would derive from tax increases on high incomes that became law on Jan. 1, in the tax agreement that the two parties reached at year-end when the efforts for a broader deficit-reduction deal collapsed.
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