It's not just taxes: Benefit cuts divide Dems

It's not just about taxes. There's another big obstacle to overcome as Congress and President Barack Obama work to skirt the fiscal cliff: deep divisions among Senate Democrats over whether to consider cuts to popular benefit programs like Medicare and Medicaid.
Associated Press
Nov 28, 2012

Much of the focus during negotiations seeking an alternative to $671 billion in automatic tax increases and spending cuts beginning in January has centered on whether Republicans would agree to raising taxes on the wealthy. Obama insists that tax increases on the wealthy must be part of any deal, even as White House officials concede that government benefit programs will have to be in the package too.

But even if GOP lawmakers agree to raise taxes, there is no guarantee Democrats can come up with enough votes in the Senate to cut benefit programs — as Republicans are demanding.

"We cannot come up with the solution for Medicare in the next two or three weeks," said Sen. Dick Durbin of Illinois, the No. 2 Democrat in the Senate. "It's too important, it's too serious, when it comes to this fiscal cliff debate."

Durbin has long said Democrats must be willing to discuss cuts to benefit programs in exchange for tax increases on the wealthy. But, he said Wednesday, the issue is too complicated to address in a short postelection session of Congress.

Republicans complain that Democrats are taking issues off the table, even as more GOP lawmakers are reluctantly considering tax increases.

"Democrats like to pretend as though they're the great protectors of Social Security, Medicare and Medicaid," said Senate Republican Leader Mitch McConnell of Kentucky. "They make solemn pledges all the time about how they won't even entertain a discussion about reform. What they don't say is that ignoring these programs is the surest way to guarantee their collapse."

There's a growing consensus among Senate Democrats and the White House that Social Security should be exempt from any deficit-reduction package. But some centrist Democrats in the Senate argue that fellow Democrats must be willing to consider cuts to Medicare and Medicaid in order to get concessions from Republicans on taxes.

"It has to be both — a significant revenue increase as well as spending cuts," said Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee.

Sen. Kent Conrad, D-N.D., who is retiring as chairman of the Senate Budget Committee, said rising health care costs in Medicare and Medicaid are helping to drive future spending, making them an essential part of a long-term deficit-reduction package.

"I've been part of every bipartisan group here. We've always put everything on the table," Conrad said. "If you're going to solve this problem, you're going to have to deal with where the spending is and the revenue can be raised."

But senators like Baucus and Conrad increasingly are being drowned out by other Democrats emboldened by the recent election results to fight against benefit cuts.

"I think the election spoke very strongly about the fact that the vast majority of American people don't want to cut these programs," said Sen. Tom Harkin, D-Iowa.

Further complicating the issue, some Democrats say they are willing to look for savings in programs like Medicare and Medicaid, as long as cuts don't lead to higher costs for beneficiaries. Obama's new health care law, for example, assumes more than $700 billion in Medicare savings over the next decade.

"I'm willing to look at ways of making the programs work better," Harkin said.

Congress and the White House are devoting the next three weeks to finding at least a bridge over the fiscal cliff by reducing the sudden jolt of higher taxes and spending cuts in January while laying a framework for addressing the nation's long-term financial problems next year.

Obama wants to let tax rates rise for wealthy families while sparing middle- and low-income taxpayers. Some Republican leaders, including House Speaker John Boehner of Ohio, have said they were willing to consider making the wealthy pay more by reducing their tax breaks. But most Republicans in Congress adamantly oppose raising anyone's tax rates.

Negotiations are going slowly as each side waits for the other to make concessions.

Democrats already have tried to take Social Security off the table. White House press secretary Jay Carney said this week that changes to the massive retirement and disability program should be done separately from any plan to reduce the deficit. That's the same position taken by 28 Democratic senators and independent Sen. Bernie Sanders of Vermont in a letter to fellow senators in September.

"We will oppose including Social Security cuts for future or current beneficiaries in any deficit-reduction package," said the letter, which was signed by many top Democrats, including Majority Leader Harry Reid of Nevada. In the House, Democratic leader Nancy Pelosi has taken the same position, not only on Social Security, but also on Medicare and Medicaid.

"There hasn't been the slightest suggestion about what they're going to do about the real problems, and that's entitlements," said Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee. "There's a certain cockiness that I've seen that is really astounding to me since we're basically in the same position we were before" the election.

 

Comments

OMG.LOL.WT_

End welfare for the wealthy
http://www.cnn.com/2011/12/01/op...

JACKEL

Good point,we can't end it for anyone because we won't get reelected.They represent a large percent of the voters.Bozo is going to have a tough four years, based on the administration of the last four years.

SamAdams

Oh, for gods sake. Is there some reason so many people try to make this so much harder than it really is? Medicare and Medicaid (Social Security, too) need REFORMED, not necessarily cut (reform would result in savings all by itself). It's the useless or unnecessary nonsense that REALLY needs to be cut. Mohair subsidy, anybody? Studies on the sex lives of bees? (Maybe something useful does come of the latter, but why should the feds pay for it?) Bridges to nowhere. Kobe beef in the White House. See? Savings large and small.

Washington doesn't have an income problem. It has a SPENDING problem. And like any other shopaholic, the only way to get it under control is to just freaking STOP IT.

The Big Dog's back

Washington HAS an income problem.

Randy_Marsh

http://www.usdebtclock.org/ Not only is your argument invalid it is dumb.

wiredmama222

no, it has a spending problem...stop the congress from raising their own salaries would be a great start...they don't earn what they make now.

the office cat

WAshington has an income problem because it has to pay for wars and Medicare Advantage (someday) and all those Republican earmarks you mentioned. PLUS the trickle down from the Bush Taxcuts got caught in a waste dump somewhere.

mikel

cat, somewhere along the line you forgot to mention all of the money the prez is paying to those that are on the dole. and now, the idiot, wants to extend the social security tax break for another year!!! then shut up, democraps, about that being underfunded!

JACKEL

How about why does pigshxt smell.?Tax the rich as long as it gets the idiots in Washington!

wiredmama222

I agree, Sam. What idiot in Washington thinks it needs a study on the sex life of an earthworm and will give you an $600,000 grant to study it? How about $250,000 to study the corona of the sun for a winter in Alaska? Now there is something useful...seeing as how it is DARK there in the winter. Oh, the list goes on. Just go to the library and get the grant books. You will be amazed at what the government will give you for a well written grant. Its really stupid.

Cut that stuff out and you have half the battle won right there. You could fund a small country on what you would save.

And while I am on that, why are we giving money to small countries when WE need it? If we are in such bad shape, why are we sending money to places like Pakistan, Somalia and other countries? We borrow it to give it away? What nonsense is that? Cut the funding. We should not be giving aide to any of those countries.

There are so many goof ups its dumb. If we can't pay our bills, then we need to cut costs. We should start with the dumb stuff first.

goofus

The latest from Obozo is more stimulus to make up for the slowing down of the economy from raising taxes. People really voted for the buffoon!! Now we have 135 pages of new rules for the IRS, thanks O

OMG.LOL.WT_

“A congressman has two ends, a thinking end and a sitting end. Since his entire career depends on his seat, why bother, friend?”

donutshopguy

Let's all watch our elected officials "kick the can down the road" until it's over the cliff. Can someone in Washington, Columbus or Erie County "grow a pair" and make decisions that will allow my kids and grandkids to have a country to live in.

the office cat

donutshopguy... we can only hope it goes over the cliff. Unlike a year ago, we'll have a more controllable Congress that can salvage it before any cuts occur - except the upper 2% - and then Congress can look at reform (or maybe paying back all the money borrowed to balance Reagan budgets...

donutshopguy

With the absents of real leaders the voting public will elect a dictator to solve their problems. Now it's scary.

Randy_Marsh

Those who forget the past are condemned to repeat it. Just look at Dog.

Darwin's choice

" Ineptocracy ", A form of government where the least capable of leading are elected by the least capable of producing, and where the members of the population least likely to sustain themselves or succeed, are rewarded with goods and services paid for by the confiscated(taxed) wealth of a diminishing number of producers.

I think we've made it here.........

donutshopguy

Darwin's choice,

The word of the decade. "Ineptocracy"........ We are there!

mikel

let's go overrrrrrrrrrrrrrrrr..ahhhhhhhhhhh.....boom!!!!

please oh annointed one just what cuts you are going to make. all that spews out of your mouth is that you want to raise taxes and have a plan for that. you then say that cuts also need to be made. sooooo, what are they?

the office cat

Mikel... I'm driving the bus!!! All you TEAlemmings and Firelands Patriots jump on! Nothing major will happen except the automatic end of Bush Tax Cuts. Military can be restored and Middle Class tax cuts after January 3 when the new Congress is sworn in. Giddyup go!!!!

Contango

We will either practice austerity or austerity will be thrust upon us and at a time not of our choosing.

"The crisis is not an outgrowth of the abandonment of the expansionist policy.

It is the inextricable and unavoidable aftermath of this policy. The question is only whether one should continue expansionism until the final collapse of the whole monetary and credit system or whether one should stop at an earlier date.

The sooner one stops, the less grievous are the damages inflicted and the losses suffered."

- Ludwig von Mises, "The Trade Cycle and Credit Expansion: The Economic Consequences of Cheap Money." (1946)

the office cat

Contango... and what WAS the 1946 answer to continued expansionism... wasn't that the era of "The Greatest Generation", Ike's huge infrastructure program to build National HIghways, the suburban housing boom, the Man in the Gray Flannel suit,,,? Your point? Of course, it WAS against the law to own gold.

Contango

@ the office cat:

Yea, Truman went to war in Korea - boosts GDP.

Also, the county wasn't up to it's eyeballs in debt in the 1950s as it is now and the world's manufacturing wasn't in shambles.

No comparison.

The Big Dog's back

The working middle class working person has been paying their fair share for the last 30 years. It's time for the wealthy to step up to the plate. Time to tax unearned income the same as working income.

Pete

First loophole I would close is the union dues deduction as a "professional association". Being a socialist should not be a deduction.
Next tax all union holdings and income like regular businesses. Not for profit is a joke.

the office cat

Pete. First, though, apply your hatchet to churches...politics has no place in the sanctuary.

Pete

At least churches have morals. Unions, not so much. Very little if any in their ranks.

The Big Dog's back

People in glass houses shouldn't throw stones.

kURTje

Start cutting ALL elected servants pay & bennies starting at the top.

jon491

Stop giving 2 BILLION a year to Pakistan,for nothing.

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