Posts Tagged ‘
Medicare ’
Thursday, May 26th, 2011
Will Marshall
Will Marshall is the president of the Progressive Policy Institute.
by Will Marshall
Republicans are crying foul over Democrats’ resort to “Mediscare” tactics to win an open House seat in New York. Democrats are chortling because they think the GOP’s heretofore unstoppable austerity offensive may have met its Stalingrad.
All this is diverting to aficionados of partisan thrust-and-parry in Washington. But the rest of the country may be less amused. By adhering to unbending, absolutist positions on Medicare and taxes, could Democrats and Republicans be cracking open the door to a serious third party challenge in 2012?
On Tuesday, Democrat Kathy Hochul won a traditionally Republican House seat in upstate New York in a special election. She relentlessly linked her GOP opponent to Rep. Paul Ryan’s plan for making deep cuts in Medicare while preserving the Bush tax cuts for the rich. Many Democrats now see this as the winning formula for next year’s elections.
Ryan complained yesterday that Democrats are “shamelessly demagoguing and distorting” his plan. It was hard to feel any sympathy for the earnest House Budget Commission chairman, however, since Republicans in 2010 spent millions on ads shamelessly blasting Democratic candidates for backing the proposed Medicare cuts in Obamacare. There’s actual double hypocrisy at work here, since Ryan’s Medicare proposal works through the same health exchanges Republicans find so objectionable in Obama’s plan.
Being called a demagogue by the party of death panels and death taxes is like being called ugly by a crab.
Nonetheless, Democrats need to resist the temptation to pay back their opponents in kind. They need to retain the flexibility to slow down Medicare’s cost growth, which as Bill Clinton said yesterday at the Peterson Foundation Fiscal Summit, is the sine qua non of any serious proposal to reduce federal deficits and debt.
Medicare spending is by far the biggest driver of federal spending growth. Together with Social Security, it represents nearly one-third of federal spending. According to the Social Security and Medicare Trustees, the government is slated to transfer over $3.4 trillion in general revenues to Medicare by 2020. This problem needs to be tackled now, even if it complicates Democrats’ ability to run on “Medagoguery” in 2012.
Meanwhile, “progressives” aren’t helping by running a ridiculously over-the-top ad showing a Ryan look-alike pitching a wheelchair-bound granny off a cliff. True progressives believe in solving the nation’s core dilemmas, not fetishizing the status quo. Cutting the nation’s debts down to manageable size will require both higher revenues and lower rates of entitlement spending growth.
If Democrats and Republicans can’t produce a fix along these lines, they practically invite the 2012 version of Ross Perot into the race.
Tags: Bill Clinton, Deficits and debt, Kathy Hochul, Medicare, New York, Paul Ryan, Ross Perot, Social Security, third party
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Thursday, November 18th, 2010
Elbert Ventura
Elbert Ventura is the managing editor of Democracy: A Journal of Ideas. He formerly served as the managing editor of the Progressive Policy Institute.
by Elbert Ventura
‘Tis the season for deficit commissions. The past week has brought not one, not two, but three stabs at solving America’s looming fiscal crisis. And just yesterday, the Brookings Institution hosted a panel discussion on “The Politics of Entitlement Reform and the Budget Deficit,” featuring a murderers’ row of budget experts across the ideological spectrum. All the activity underscores just how much concerns about the deficit have taken over the Washington conversation.
But will all that hand-wringing lead to anything concrete and enduring? I have my doubts. The substantive merits and faults of the plans aside, what’s striking is, frankly, how unlikely any action seems to be.
Too pessimistic? Perhaps. But at the Brookings event, there was a subterranean motif that tempered any enthusiasm one might have for any ideas put forward. Isabel Sawhill, director of Brookings’ Budgeting and National Priorities project, at one point said, “The public is in denial about the scope of the problem.” Meanwhile, Eugene Steuerle of the Urban Institute sounded another note of consternation: “Both political parties are afraid to ask the middle class to do anything.”
There, neatly stated, are two fundamental problems that stand in the way of fiscal balance: a public in denial, a politics in retreat. Simply put, the American public simply has no idea how much the government that they like to have around costs. They may profess to hate big government, but ask about cuts to the entitlement programs – by far the largest contributors to our long-term deficit – and what do they say? Hands off! Even 62 percent of Tea Partiers say that Social Security and Medicare are worth the cost of the programs; the general public is even more supportive, at 76 percent.
Recent research by Cornell political scientist Suzanne Mettler underscores the disconnect between the kind of government Americans say they want and the government they actually use. In a recent paper that takes a look at Americans’ relationship with the “submerged state” – federal policies that incentivize and subsidize behavior by individuals – Mettler found that most Americans have little awareness of how the state affects their lives. Most alarming were the results of a survey of program beneficiaries who were asked if they had ever used a government program. Forty-four percent of those collecting Social Security retirement and survival benefits said no; 43 percent who had benefited from unemployment insurance said no; nearly 40 percent of Medicare said no. There’s more: 47 percent who took home earned income tax credit said no; 53 percent of those who took Pell Grants said no; and 60 percent who benefited from the home mortgage interest deduction said no.
So the governed don’t know. What about those who govern? Alas, our political elite seems to have lost all sense of responsibility at steering the ship of state to calmer waters. The fault lies mainly with the right. Yes, Nancy Pelosi’s declaration that Social Security and Medicare cuts are off-limits is easily caricatured as liberalism at its worst, but let’s face it – Pelosi faces a lot of opposition on her side on that front. There is a genuine debate going on under the big progressive tent about just how much entitlements should be touched, if at all, and it’s testimony to the vibrancy – and fractiousness – of progressivism.
Contrast that with the right, which has become an all-tax-cut, all-the-time movement. Grover Norquist, in whose image today’s Republican Party has been modeled, dismissed the Bowles-Simpson report, with his organization, Americans for Tax Reform, calling it “a plan to raise taxes cloaked in the veil of bipartisanship” – this in response to a plan that, by any objective measure, by far does more on the spending side than the revenue side. If their starting point is no revenue increases at all, then the right has all but written the obituary on any attempt to narrow the budget gap.
So there you have: a failure of government, a failure of the governed. Until the American public begins to accept responsibility for the current fiscal straits – and it begins by asking serious questions about what they’d like to see from government and how much they’re willing to pay for it – there really is little hope that we’ll see movement on the issue. Meanwhile, the only institution that can give them that nudge, our political class, isn’t up to the task.
When asked about the worst-case scenario that would finally force policy-makers’ hand to do something, Brookings’ Henry Aaron had a one-word response: “Greece.” Americans may profess to hate European-style states, but the disconnect between their hatred of taxes and love of benefits may well hasten the day of a European-style collapse.
Photo credit: nflravens
Tags: all-tax-cut, American public, Americans for Tax Reform, Brookings Institution, Brookings’ Budgeting and National Priorities project, Common Sense, Cornell, deficit commissions, Eugene Steuerle, fiscal balance, fiscal crisis, fiscal straits, Greece, Grover Norquist, Henry Aaron, Isabel Sawhill, Medicare, Nancy Pelosi, Pell Grants, politics in retreat, public in denial, Republican Party, Social Security, Suzanne Mettler, Tea Partiers, The Politics of Entitlement Reform and the Budget Deficit, Tis the season, Urban Institute
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Wednesday, October 20th, 2010
Will Marshall
Will Marshall is the president of the Progressive Policy Institute.
by Will Marshall
It’s crazy, I know, but imagine that U.S. political leaders after the midterm election called a truce in the partisan tong wars to work out a compromise solution to the nation’s fiscal dilemmas. The result would probably look a lot like a new fiscal reform blueprint drawn up by two canny policy veterans, Bill Galston and Maya MacGuineas.
In The Future Is Now: A Balanced Plan to Stabilize Public Debt and Promote Economic Growth, Galston and MacGuineas map a radically centrist course to fiscal discipline that demands equal sacrifice from the left and the right, and that doesn’t impede economic recovery. Here’s hoping that President Obama’s deficit commission, which is groping for a politically feasible formula for fiscal restraint, will give this plan a close look.
Reducing America’s swollen deficits and debts is fast becoming an urgent national priority. Since President Obama took office, we’ve added three trillion dollars to the public debt, largely thanks to emergency spending to rescue the banking system and goose a faltering economy. But it’s the zooming growth of health care and retirement spending that really threatens to drown the federal government in debt. For decades, we’ve ignored warnings about the growing funding gaps in Medicare, Medicaid, and Social Security, but with the first wave of baby boomers now reaching retirement age, the future really is now.
We’ve dug ourselves more than a hole – it’s a canyon. So any talk now about balancing the federal budget is pure fantasy. The best we can hope for is to arrest the runaway growth of public debt and bring it back down to a sustainable level.
The administration’s forecasts show public debt, 40 percent of GDP two years ago, rising to more than 100 percent in 2012. The Galston-MacGuineas plan would bring that down to 60 percent of economic output by the end of this decade. It also would slash annual budget deficits from a projected five-to-six percent to around one percent, ensuring that our debts don’t grow faster than the economy.
Inevitably, the plan envisions a 50-50 split between spending reductions and tax hikes. It’s hard to image any other way forward considering liberal resistance to spending cuts, especially for the big entitlements that are driving our long-term debt problem, and the conservative allergy to tax increases of any kind. The hacking and lifting, however, would be phased in gradually to give the economy room to breathe and recover.
More specifically, the plan would:
- Make sizeable cuts in defense spending, and impose a war surtax should our current conflicts extend beyond mid-decade.
- Freeze discretionary spending for three years, such that increases in spending in one area would have to be made up by cuts elsewhere.
- Modernize Social Security by indexing the retirement age to longevity, and trimming benefits for affluent retirees in the future. It would also raise the minimum benefit, strengthening the program’s anti-poverty effect, cut the payroll tax and add a new, mandatory savings account.
- Supplement the cost-containment features of President Obama’s comprehensive health plan, by raising Medicare premiums, reducing subsidies and adding tort reform.
- Prune tax expenditures (which cost more than one trillion dollars a year) by 10 percent and limit their future growth. The proceeds would go to lower tax rates and deficit reduction.
- Enact a carbon tax, both to “buy down” the payroll tax and cut deficits.
Many of these proposals, of course, are deemed politically radioactive now, even if they are familiar fixtures on the wish lists of serious fiscal hawks. So why should we expect a package stuffed with political non-starters to advance?
Because the habit of evading even modestly tough choices has allowed the debt problem to reach such ginormous proportions that it can’t be solved in any other way, say Galston and MacGuineas. And if it isn’t solved, it will slow down U.S. economic growth, transfer our wealth to overseas creditors, and limit the federal budget’s fiscal capacity to respond to future emergencies.
The big question is: what impact will the midterm election have on the politics of fiscal evasion? Republicans say cutting taxes is the way to shrink government, but showed little stomach for cutting spending when they were in office. Result: huge public debts. Some Democrats believe deficits should be closed mostly by tax hikes, but aren’t really willing to propose them. Result: huge public debts.
As the Galston-MacGuineas plan shows, solving our fiscal problems doesn’t have to be a political zero sum game. The question is whether our political leaders can rediscover the lost arts of compromise and risk-sharing to advance vital national goals.
Photo credit: Steve Rhodes
Tags: anti-poverty, baby boomers, banking system, big entitlements, Bill Galston, carbon tax, centrist, compromise solution, deficit commission, deficits and debts, discretionary spending, economic recovery, faltering economy., federal budget, fiscal discipline, fiscal hawks, Fiscal Reform, Fiscal Responsibility, fiscal restraint, growth, health care and retirement, liberal resistance, longevity, Maya MacGuineas, Medicaid, Medicare, midterm election, minimum benefit, nation’s fiscal dilemmas, new fiscal reform blueprint, overseas creditors, payroll tax, Politics and politicians, President Obama, Progressivism, public debt, radical center, retirement age, savings account, Social Security, spending reductions, tax expenditures, tax hikes, The Future Is Now: A Balanced Plan to Stabilize Public Debt and Promote Economic Growth, tort reform, U.S. political leaders, war surtax
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Tuesday, October 12th, 2010
Scott Winship
Scott Winship is research manager of the Pew Economic Mobility Project and a recent graduate of Harvard's doctoral program in social policy. The views he expresses do not represent those of Pew.
by Scott Winship
The night that President Obama won the presidency, I was distracted by a looming deadline for New Republic piece I was already writing warning the left not to misinterpret the election results. Democratic Congressional victories were primarily the result of voters continuing to grow sour on the way Republicans ran the House and Senate. Obama’s victory owed its magnitude to the financial crisis and McCain’s response to it. Essentially, I warned that the 50-50 Nation was alive and well and that moving too aggressively could backfire.
The piece was largely ignored at the time, but it is looking pretty good today. Democrats successfully enacted landmark health care legislation, shepherded the financial system through a harrowing period when fears of another depression were widespread, passed an enormous stimulus package, and pushed through financial reform. In the process, the deficit soared to worrying levels, unemployment continued to rise, the government became the owner of FannieMae and FreddieMac and part owners of the automobile companies, the economy limped along, and public opinion turned against them.
In a sure sign that in its own way, the left is as out of touch as the conservative tea party activists, liberals lamented the supposed timidity and corporate-coziness of the Administration, and the base grew depressed. This despite the unprecedented scale of federal spending and intervention into the workings of the economy, the near death of health care reform (the biggest progressive victory since Medicare’s enactment), and loss of support among independents and moderates. Progressives thought they had a mandate for aggressive change. Apparently they still don’t realize that they didn’t.
Ironically, one of the left’s leading pundits, E. J. Dionne, argued in a sharp book in the 1990s called They Only Look Dead that the way to understand the 1992, 1994, and 1996 elections was to view the first two years as a period of liberal overreach and the second two years as a mirror image on the right. Despite all the evidence that the country is even more closely divided today, liberals such as Dionne cannot see the same dynamic of partisan overreach playing out over the past decade. But it was there during the Bush years on the right, and it has been there over the past two momentous years on the left.
Yes, the economy is surely the driving force behind voter dissatisfaction with Democrats, and Obama was damned if he did (spend hundreds of billions to avoid a depression) and damned if he didn’t. But health care was supposed to be a game changer—if voters were so keen on a massive disruption of the health care sector, as progressives have argued for twenty years now, why hasn’t this trumped the economy? The electorate is fundamentally moderate and as poorly served by liberals who want to circumvent that moderation as by tea-party conservatives who are convinced Obama is a socialist Muslim foreigner. It will be interesting to see which party—if either—gets it between now and 2012.
This article is cross-posted at No Labels.
Photo credit: Hyokano
Tags: 50-50 Nation, Bush, Campaigns and elections, conservative tea party activists, corporate-coziness, deficit, Democratic Congressional, depression, E. J. Dionne, Economy, FannieMae, federal spending, financial crisis, Financial reform, financial system, FreddieMac, Health care, House, independents, left, liberals, McCain, Medicare, moderates, New Republic, President Obama, progressive, Public opinion, republicans, Senate, socialist, stimulus package, They Only Look Dead, unemployment
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Monday, October 11th, 2010
Chris Miller
Chris Miller is a Purple Heart and Combat Action Badge recipient and eight-year U.S. Army veteran, having served two tours in Baghdad, Iraq. He is currently a law student and a fellow with the Truman National Security Project.
by Chris Miller
This post is the third in a series about the Progressive Military
The wounds from the healthcare debate in America are still fresh. There are many in the GOP Congressional minority that would see the healthcare bill repealed, and there has been much scare-mongering about a government-run healthcare system – that patients will be lost in the bureaucracy, they’ll lose control over their health decisions, the quality of care will suffer, and the costs will be tremendous.
If the Veterans Administration healthcare system is an example, those fears are overblown. The military’s government-run healthcare system is not just good in the field, it’s good at home as well and shows that government can do healthcare.
I was a customer of 100% government-run healthcare for eight years. I visited the emergency room, received all my shots and checkups, got my wisdom teeth pulled, and received my prescribed medication all without being killed or turned away by some bureaucrat. I received the same level of care everywhere, whether in Missouri, Washington, Germany, or Iraq. And not just me, my family as well. I’m not alone. There are over 1.4 million Americans on active duty in the U.S. military. If you include their family members, retirees, and those receiving Veterans Administration benefits, the number swells to over 9 million Americans already actively receiving government healthcare.
Active duty troops and their families use the 532 active military medical facilities nationwide and enroll in TRICARE, which is the military’s government-run healthcare system. Reservists called to active duty over 30 days are covered as well. For retirees, TRICARE fills the gap for what Medicare doesn’t cover. CHAMPVA gives the same coverage to family members of disabled or deceased service members no longer serving and gives them access to Veterans Administration hospitals. The Veterans Administration system (VA) coverage has changed from serving only troops with service-connected disabilities to serving all veterans based upon need. There are over 24 million Americans eligible for VA medical benefits at over 1000 facilities nationwide, 9 million of which are over 65.
It’s a well-known fact that the traumas caused on the battlefields in Iraq and Afghanistan lead, by necessity, to innovations in trauma care. As an Iraq war veteran, I saw this in action personally with our combat medics, especially when they patched me up after suicide car-bomber hit my vehicle head-on. The military health system also develops medical technology, techniques, and procedures that can be used in the civilian world.
The Army’s National Trauma Institute, in cooperation with several universities, collects data from wounded soldiers to identify what can be done to improve their first-response treatment and will help not only on the battlefield, but in civilian hospitals as well. The military is making an exemplary push to digitize medical records in order to make them easier to search through and transfer between locations, not to mention saving money. This idea was picked up in the new healthcare legislation.
The uniformity of the military medical system also pays dividends in health safety against epidemics and pandemics, as exhibited by the fast and nearly-comprehensive immunization rate of soldiers against H1N1. Achieving such rates quickly among the civilian population would be improbable. I and many other soldiers are also vaccinated against diseases many in the civilian population are not anymore, namely small pox and anthrax. Our troops also get the flu shot at the beginning of every flu season. The military was the first to test the effectiveness of flu nasal-spray vaccinations compared with shots to reduce the use and cost of needles. This is done not just for their health, but also to save the system from having to pay more money for sick sailors and airmen later.
The military is devoted to preventing disease, illness, and injury not only because it they take troops off the field, but they also cost the system money. The U.S. Army Public Health Command and similar organizations in the other services are devoted exclusively to this mission.
If you contrast a system that has an interest in seeing that you to stay healthy because it saves them (the government) money with a system that makes money when you are sick, (insurance companies, HMOs) one can see that a pinch of prevention is worth a pound of cure. A similar government system implemented nationwide would save people money, improve their health, and save lives. If universal government-run healthcare is good enough for the troops, it’s good enough for us all.
It’s true the system is not perfect. There have been scandals surrounding military healthcare, such as the living conditions for recovering troops at Walter Reed Medical Center and veterans groups (some of which I am a member of) constantly push for improvements to the VA system. But in general the quality of military healthcare is very good, and proof that government-run healthcare can indeed work.
Photo credit: US Army Africa
Tags: Afghanistan, anthrax, bureaucracy, bureaucrat, CHAMPVA, civilian hospitals, combat medics, digitize medical records, emergency room, epidemics, first-response treatment, flu nasal-spray vaccinations, flu season, flu shot, Germany, GOP Congressional, government healthcare, government-run healthcare system, H1N1, health safety, Healthcare, healthcare debate, healthcare legislation, HMO, immunization rate, innovations, insurance companies, Iraq, medical technology, Medicare, military medical facilities, military’s government-run healthcare system, Missouri, National Trauma Institute, pandemics, Progressive Military, Reservists, Service members, small pox, suicide car-bomber, trauma care, TRICARE, troops, U.S. Army Public Health Command, U.S. Military, Veterans Administration, Veterans Administration system, Walter Reed Medical Center, Washington
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Monday, September 20th, 2010
Ed Kilgore
Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.
by Ed Kilgore
Weeks before the November elections, leaders of the Republican Party’s increasingly dominant right wing are spending nearly as much time fretting over the potential squeamishness of their own party about implementing a radical agenda as they are ensuring they get the opportunity to enact one.
In a CNN interview yesterday, Sen. Jim DeMint, the one-time kooky loner who’s now a Very Big Dog in the GOP, said the GOP would be “dead” if it didn’t keep its promises to repeal health care reform, balance the federal budget and radically reduce spending. Remember he’s the guy who thinks Social Security and Medicare have ensnared Americans in socialism, and likes to call public schools “government schools.”
Another fringe figure who’s suddenly become very relevant, congressman Steve King of Iowa, is frantic in his fears that a Republican House would fail to shut down the government as part of a strategy to repeal health reform. Indeed, he’s asking would-be Speaker John Boehner to sign a “blood oath” to include a health reform repeal in every single appropriations bill, which would have the effect of shutting down the government, just as Republicans tried to do, unsuccessfully, in 1995, in order to impose a budget on Bill Clinton.
This is a sideshow well worth watching. People like DeMint and King are trying to lash their fellow Republicans to the mast of their ship and make them immune to the siren song of the massive popularity of the public programs and commitments they aim to attack: Medicare, Social Security, federal support for educational opportunity, environmental protection, and on and on. It’s an interesting approach on the brink of what many expect to be a big Republican electoral victory, and says a lot about the gap between what Republicans are campaigning on and how they actually intend to govern when in office.
This piece is cross-posted at the Democratic Strategist
Photo credit: Mark Hyre
Tags: Bill Clinton, CNN, Democratic Strategist, environmental protection, federal budget, GOP, government schools, health care reform, health reform repeal, Iowa, Jim DeMint, John Boehner, Medicare, November Elections, public programs, public schools, radical agenda, Republican Party, right wing, Social Security, socialism, Steve King
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Monday, July 26th, 2010
Adriana Sanchez de Lozada
Adriana Sanchez de Lozada is an intern at the Progressive Policy Institute.
by Adriana Sanchez de Lozada
The Congressional Budget Office’s long-term budget forecasts on the national fiscal health are highly educated guesswork, but guesswork just the same. The 2030s are pretty far off, and the degree of forecasting uncertainty is higher than it once was. As CBO explains “the current degree of economic dislocation exceeds that of any previous period in the past half-century, so the uncertainty inherent in current forecasts probably exceeds the historical average.” But let’s imagine that the 2030s have arrived, and that CBO’s budget projections have come true. What would America look like?
For starters, Social Security would be flat broke. All U.S. Treasury’s IOUs to Social Security will have been cashed in. Since the Social Security trust funds will be completely depleted and, because Social Security is barred by law from borrowing from the federal government, the program will be unable to meet its obligations. Thus, by the end of the 2030s, payable benefits would have to be cut by 20 percent. Is it possible to imagine that the government will suddenly cut 20 percent of the benefits it hands out? That seems unlikely — the law would be changed and borrowing would resume.
In fact, Social Security’s problems would start much earlier. In 2016, according to CBO, its outlays would begin to regularly exceed its revenues, and consequently Social Security would first start to regularly call in its IOUs. Thus, the Treasury Department would need to borrow billions of dollars each year to pay back what it borrowed from Social Security’s trust funds.
If Social Security is expected to be in bad shape by the 2030s, the big public health care programs, Medicare and Medicaid, would be doing even worse. The culprits being an aging population and expanding health care costs, which are scheduled to grow faster than the U.S. economy. By the 2030s the number of people over the age of 65 — the beneficiaries – will have increased by 90 percent while those between 20 and 65 — the contributors — will have grown by a meager 10 percent.
In the 2030s, federal spending on mandatory health care programs accounts for 11 percent of GDP, about twice the level in 2010. Add in Social Security, and the big three entitlements cost about 16 percent of GDP. Keep in mind that primary spending for the 40 year period before 2010 averaged 18.5 percent of GDP. This means that in 2030, the U.S. government will either be unable to direct resources to other priorities (like education,) or will have to increase a tax rate by roughly double that of 2010.
Finally, America in the 2030s will groan under mind-boggling public debt, assuming the country’s fiscal fortunes are calculated by the CBO under what’s called a “current policy” scenario. In this case, the CBO assumes that no major public policy innovations will occur throughout the lifetime of its projection. This scenario reflects the political reality we face today. For example, congress is currently debating whether to extend the Bush tax cuts and “patch” the Alternative Minimum Tax. If political inaction prevails, debt-to-GDP ratio would exceed 200 percent by the 2030s, even with an economic recovery.
It is true that the U.S. holds a privileged position by virtue of the dollar’s role as the world’s reserve currency. But we have no idea how a debt of this magnitude would affect our ability to invest in future growth, and to keep borrowing from abroad. Moreover, in the 2030s, interest payments on the national debt are nine percent of GDP, from just one percent of GDP in 2010. If we continue borrowing at the projected rates beyond 2030, interest spending would exceed total federal revenues 15 years thereafter.
Finally, this grim fiscal portrait of America in the 2030s rests on optimistic assumptions. CBO projections assume that revenue will average around 19 percent of GDP and that long-term interest rates remain low. They also assume away the strong likelihood that America will face another economic crisis or armed conflict between 2010 and 2030.
The key for policy-makers, of course, is to envision a different fiscal future for America – and to act on it just as soon as the economy recovers.
Photo Credit: Alancleaver_2000′s Photostream
Tags: Alternative Minimum Tax, AMT, budget deficit, Bush tax cuts, Congressional Budget Office, Medicaid, Medicare, Social Security
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Monday, July 12th, 2010
Ed Kilgore
Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.
by Ed Kilgore
Seyward Darby has an amusing piece at the New Republic‘s site with some of the loonier provisions found in state Republican Party platform documents.
It’s all good clean fun, but does this craziness matter? No, suggests the CW; party platform committees these days, at any level, are a sandbox dominated by ideological activists, producing turgid documents that candidates feel free to ignore.
Fair enough, I guess, but what about those states where ideological activists have an unusually important role? How about, say, Iowa, whose caucuses often all but dictate one or the other party’s nominating process?
I strongly suggest a reading of the Iowa Republican Party Platform by anyone who accuses “liberals” or “the media” of exaggerating the extremism of today’s conservatives.
This 367-plank, 12,000-word document, adopted just last month at the Iowa State Republican Convention, is relentlessly kooky. Right up top, before the “statement of principles,” the platform features a long, ominous quote from Cicero about “traitors.” It’s not made clear whether said traitors are Democrats, RINOs, or Muslims, but treason sure seems to be a major preoccupation for Iowa Republicans.
Once you get to the “statement of principles,” it’s hard to miss principle number seven, which would have satisfied Ayn Rand even on one of her crankier days:
The individual works hard for what is his/hers. Therefore, the individual will determine with whom he/she will share it, not the government. No more legal plunder. Legal plunder is defined as using the law to take from one person what belongs to them, and giving it to others to whom it does not belong. It is plunder if the law benefits one citizen at the expense of another by doing what that citizen himself cannot do without committing a crime.
Given that principle, it’s not surprising that elsewhere the platform flatly calls for the abolition of Social Security, Medicare and Medicaid (along with minimum wage laws), and of the federal departments of Agriculture (!), Education and Energy. It also appears to oppose any anti-discrimination laws of any sort.
Beyond such basics, the Iowa GOP Platform is essentially a compilation of every right-wing consipracy theory-based preoccupation known to man. In a nod to Glenn Beck, the statement of principles mentions “Progressivism” along with “Collectivism, Socialism, Fascism, [and] Communism” as ideologies incompatible with the Founding Fathers’ design. There’s a birther plank. There’s a plank about the “NAFTA Superhighway.” There’s a plank about ACORN. There’s a plank about the “fairness doctrine.” There’s plank after plank after plank opposing the nefarious activities of the United Nations. There’s a plank calling for abolition of the Federal Reserve System. Needless to say, there are many, many planks spelling out total opposition to abortion and same-sex marriage in excrutiating detail, and attacking any limitation on campaign activities or use of tax dollars by religious organizations.
The very end of the platform holds that Republican candidates should be denied party funds if they don’t agree with at least 80% of the platform, as determined by questionnaires asking about every single crazy plank. This is something we should all be able to get behind; I’d love to see not only Iowa Republican gubernatorial candidate Terry Branstad, a notorious fence-straddler on many issues, but the entire 2012 GOP presidential field, have to check boxes next to solemn items like:
We oppose any effort to implement Islamic Shariah law in this country.
If all this madness is really out of the mainstream of Republican thinking, then perhaps the adults of the GOP should expend the minimum effort necessary to say so very explicitly.
Photo credit: Mike Licht, NotionsCapita.com’s Photostream
This item is cross-posted at The Democratic Strategist.
Tags: Ayn Rand, Clean energy and technology, Conservatism, Democratic Party, Education, Glenn Beck, Iowa, Iowa Republican Party Platform, Medicaid, Medicare, Muslims, New Republic, Politics and politicians, Progressivism, Republican Party, RINO, Seyward Darby, Social Security, Terry Branstad, United Nations
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Wednesday, June 23rd, 2010
Will Marshall
Will Marshall is the president of the Progressive Policy Institute.
by Will Marshall
Congress isn’t always the first place you look for intellectually honest discussion of America’s fiscal dilemmas. Neither party has clean hands, yet each points smudged fingers at the other. How refreshing then to hear Rep. Steny Hoyer (D-MD) uttering blunt truths rather than partisan cant about America’s exploding debts.
“Unfortunately, we can blame our long-term deficit on policies that are almost universally popular,” the House Majority Leader said yesterday at a forum hosted by Third Way. “We’re lying to ourselves and our children if we say we can maintain our current levels of entitlement spending, defense spending, and taxation without bankrupting the country,” he added.
Hoyer also wondered aloud about the wisdom of permanently extending any of the Bush tax cuts absent a serious plan for long-term deficit reduction. It’s a pertinent question for both Republican anti-tax zealots and President Obama.
Even as they excoriate Obama and the Democrats for ballooning the federal deficit, Republicans insist that all the tax cuts passed in 2001 and 2003 be extended. That would cost a cool $3 trillion over the next decade, but don’t expect the GOP to fill that gaping hole in the federal budget with spending cuts. As Hoyer pointed out, Republicans have run like scalded dogs from Rep. Paul Ryan’s “roadmap” to a balanced budget, which calls for deep cuts in Medicare and Social Security.
But President Obama is in a bind as well. He has set up a fiscal commission to come up with a plan after the midterm election to start unwinding America’s massive debts. Many economists believe such a plan is essential to boost investor and lender confidence in the soundness of the U.S. economy, and to reverse the enormous imbalances in world financial flows.
During the 2008 campaign, however, Obama promised to extend the Bush cuts for the “middle class,” which he defined as families earning less than $250,000 and individuals earning less than $200,000. That promise helped him deflect GOP efforts to brand him as an inveterate tax hiker. But it carries a high price tag: about $1.4 trillion over the next decade according to the Joint Committee on Taxation.
What’s more, the nation’s fiscal outlook has deteriorated dramatically since the campaign. Massive public spending to avert a financial and economic collapse last year could push this year’s deficit to a record $1.7 trillion. The national debt now stands at about $13 trillion, and is on course to reach 90 percent of GDP by 2020 – not far from Greek-style proportions.
America really can’t afford any of the Bush tax cuts right now. Letting them expire would give the fiscal commission more room to devise a balanced package of spending and tax reforms aimed at whittling down our debts.
But with unemployment stuck in the stratosphere, and with Democrats apparently facing sizable losses in the midterm election, it’s hard to ask them to expose middle-class families to higher taxes – especially when Republicans can be counted on to indulge in monolithic, over-the-top demagoguery.
GOP Senate Minority Leader Mitch McConnell wasted no time in unloading on Hoyer yesterday. “It’s now official. Top Democrats on Capitol Hill are starting to signal their intention to raise taxes on the middle class,” he declared on the Senate floor.
To limit the long-term fiscal impact, centrist Democrats like Hoyer are considering a temporary extension of the middle-class tax cuts. Many liberals, however, are more concerned about the supposed dangers of “austerity” than the nation’s colossal debt burden. In fact, they want to make the cuts permanent now, while Democrats still enjoy big majorities in both Houses.
So chances are Congress will extend the middle-class tax cuts this fall, setting a less-than-inspiring example of restraint for the fiscal commission.
Nonetheless, Hoyer said House Democrats are pushing a budget resolution that would limit discretionary spending; cut deeper than the president’s budget; reinforce PAYGO rules; and commit to a vote on the fiscal commission’s recommendations. It’s a modest down payment on fiscal reform that’s unlikely to suppress demand and throw the economy into a tailspin.
In any case, the contrast between Hoyer’s fiscal realism and the GOP’s denial couldn’t be sharper. Let’s hope Democrats follow their leader.
Photo credit: Center for American Progress Action Fund
Tags: Budget, Deficits and debt, Democratic Party, fiscal crisis, Fiscal Responsibility, Medicare, Mitch McConnell, Paul Ryan, Republican Party, Social Security, Steny Hoyer, Taxes
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Friday, June 18th, 2010
Ed Kilgore
Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.
by Ed Kilgore
If, as appears likely, cap-and-trade legislation is not going to be enacted this year or any other time soon, it represents more than a setback for the Obama administration (or for the environment). It’s also another blow to the high concept of using market mechanisms rather than direct government control to address major public policy challenges.
Cap-and-trade was originally designed, after all, as an alternative to command-and-control environmental regulations, which is why it was once championed by Republicans, particularly during and after its successful use in reducing acid rain in the 1990s.
But as the New York Times‘ David Leonhardt (with an exclamation point from Jonathan Chait) explained this week, Republicans have abandoned cap-and-trade just when it might be most useful, with some former advocates, ironically, embracing command-and-control:
[T]he great economic strength of market systems like cap and trade also happens to be their political weakness. They set prices and allow people to react. In the process, market systems acknowledge that reducing pollution may actually cost a little bit of money.Politicians don’t like to admit this, because voters don’t like it. Accepting higher costs is especially hard when the economy is weak. So Congressional Democrats have been repackaging their energy bills to make them look less and less market-oriented. Senator John McCain, who supported a permit system for carbon as the Republican presidential nominee, no longer does. Senator Lindsey Graham, the South Carolina Republican, has reversed his position as well.
What does Mr. Graham now favor? A series of command-and-control regulations. He has introduced a bill with Senator Richard Lugar, an Indiana Republican, that would mandate specific standards for cars, trucks, homes and offices. It would also give the energy secretary the power to award loans to companies he thought could do a good job of setting up programs to retrofit buildings. State officials would do the same for factories. The bill, in short, puts more faith in government than the market.
Leonhardt clearly believes that the transparency of cap-and-trade when it comes to costs is its major political flaw. That’s definitely a factor, but I’d argue that something more fundamental is going on. Once Democrats embraced cap-and-trade, Republicans began retreating from it as a simple matter of politics. And this distancing effort has been immensely reinforced by the rightward trend in the GOP during the last few years, in which leaders who simply denied there was any climate change problem, and/or that government had any useful role to play on the issue, have been in the ascendancy. So “cap-and-tax” was demonized and essentially placed off-limits for Republican politicians, to the point where those like Sen. Lindsay Graham (R-S.C.) and Sen. Richard Lugar (R-IN) who weren’t quite in the “denialist” camp found it easier to just support direct federal regulation.
We saw a similar dynamic play out on health reform, where a market-based managed competition model long supported by Republicans, and championed quite recently by Mitt Romney, became toxic the moment it was fully advanced by Barack Obama. And even as they savaged ObamaCare as “socialized medicine,” Republicans saw little irony in posing as last-ditch defenders of Medicare, a relic of an earlier Democratic drive for a government-run single-payer system.
On both health care and climate change, it’s not surprising that many progressives are impatient with Obama’s determination to promote market-based approaches that the supposed party of market-based policy, the GOP, will no longer support. But nobody should for a moment mistake the identity of the prime mover in shifting the political ground away from the once-promising “centrist” convergence on using market mechanisms to address public sector challenges. The GOP could have declared partial victory and celebrated the Democratic Party’s abandonment of big government solutions, and then fought it out over the details. Instead, Republicans have burned down every structure on the potential common ground that Americans seem to crave. They may be able to succeed for a while in opportunistically deploring the inability of Democrats to get anything done. But if and when Republicans regain power, they may well discover that the GOP policy arsenal has been emptied by their own hands.
This item is cross-posted at The Democratic Strategist.
Photo credit: Magnera
Tags: Barack Obama, cap-and-trade, Climate change, David Leonhardt, demo, Environment, Health care, Lindsey Graham, Medicare, Mitt Romney, oil, Republican Party, Richard Lugar
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Wednesday, April 28th, 2010
Will Marshall
Will Marshall is the president of the Progressive Policy Institute.
by Will Marshall
Politicians, especially at the national level, have little credibility on matters of fiscal discipline. Bill Clinton is an exception.
As president, Clinton inherited fast-rising budget deficits that threatened to capsize an economy emerging from recession. He made deficit reduction a top priority, incurring the wrath of liberals who accused him of governing like an Eisenhower Republican. Such complaints evaporated as jobs and economic growth surged in the late 1990s, and Clinton handed his successor budget surpluses.
In an act of monumental political irresponsibility, George W. Bush promptly squandered the surplus on big tax cuts and a $1 trillion-plus Medicare prescription drug entitlement that Republicans simply added to the nation’s charge account.
So it was worth listening to Clinton speak about the fiscal challenge facing President Obama, as he did today at a big “fiscal summit” in Washington sponsored by the Peter G. Peterson Foundation.
“I think this is a national sovereignty issue,” said Clinton, noting that foreign creditors hold 48 percent of America’s debt. As that debt grows –- Clinton’s treasury secretary, Bob Rubin, cited projections that it could reach 130 percent of GDP by 2030 –- so will the influence over U.S. policy of foreign bondholders.
As America grows older, Clinton said, “delivery systems” like health care and education become rigid and society in general tends to put a premium on security. It’s no accident that the government’s biggest programs are defense, Medicare, Medicaid and Social Security. By letting this programs continue to eat up a greater share of national output, politicians put a severe squeeze on discretionary programs that invest in the well-being of children and families.
“The future always has a smaller constituency than the present,” the former president said. “We’ve got to be a tomorrow country. We can’t do it if we mortgage our future to people in other countries.”
Clinton also noted that Congress is not organized to deal with America’s fiscal crisis. Congressional committees expand programs and mint new ones; none is charged with putting America back on a sustainable fiscal course.
Since Congress also punted on forming a deficit reduction commission, President Obama has been forced to empanel his own. As it met yesterday at the White House for the first time, Obama vowed that “everything will be on the table.”
Thanks to the cost of bailing out the financial sector and mitigating a severe recession, Obama faces a bigger fiscal challenge than Clinton’s. Budget deficits are now running at about $1.3 trillion a year, a whopping nine percent of GDP. The president’s commission needs to come up with a plan for whittling deficits down to size. But it’s even more important, as Clinton argued, to attack the structural roots of exploding debts, lest America lose control of its own economic destiny.
Photo credit: http://www.flickr.com/photos/bestrated1/ / CC BY-NC-ND 2.0
Tags: Barack Obama, Bill Clinton, Budget, Deficits and debt, Economy, Fiscal Responsibility, George W. Bush, Medicaid, Medicare, Peter G. Peterson Foundation, Robert Rubin, Social Security, spending
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Thursday, April 15th, 2010
Ed Kilgore
Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.
by Ed Kilgore
Ah, another Tax Day, another Tea Party poll! This one, from CBS/New York Times, is probably the most extensive we’ve seen. But the findings are only surprising to people who haven’t been paying close attention to the Tea Party Movement.
Tea Partiers are, in almost every significant respect, overwhelmingly conservative Republicans. Two-thirds say they always or usually vote Republican. Two-thirds are regular Fox viewers. 57 percent have a favorable view of George W. Bush, and tea partiers, unlike their fellow-citizens, almost entirely absolve the Bush administration from responsibility for either the economic situation or current budget deficits. Over 90 percent of them disapprove of Barack Obama’s job performance in every area they were asked about, and in another sharp difference from everyone else, 84 percent disapprove of him personally. Ninety-two percent think Obama’s moving the country “in the direction of socialism.” Nearly a third think he was born in another country. Three-fourths think government aid to poor people keeps them poor instead of helping them. Over half think too much has been made of the problems facing black people. Well over half think the Obama administration has favored the poor over the rich and the middle class (only 15 percent of Americans generally feel that way).
Interestingly, tea partiers are less likely than the public as a whole to think we need a third political party. That shouldn’t be surprising in a cohort that basically thinks the Bush administration was hunky-dory, but you’d never guess it from all the talk about the “threat” of a Tea Party-based third party.
So these are basically older (32 percent are retired) white conservative Republicans whose main goal, they overwhelmingly say, is to “reduce government.” But two-thirds think Social Security and Medicare are a good bargain for the country. And they certainly won’t support higher taxes.
Here’s a revealing glimpse into the older-white-conservative psychology from the Times write-up of the poll:
[N]early three-quarters of those who favor smaller government said they would prefer it even if it meant spending on domestic programs would be cut.But in follow-up interviews, Tea Party supporters said they did not want to cut Medicare or Social Security — the biggest domestic programs, suggesting instead a focus on “waste.”
Some defended being on Social Security while fighting big government by saying that since they had paid into the system, they deserved the benefits.
Others could not explain the contradiction.
“That’s a conundrum, isn’t it?” asked Jodine White, 62, of Rocklin, Calif. “I don’t know what to say. Maybe I don’t want smaller government. I guess I want smaller government and my Social Security.” She added, “I didn’t look at it from the perspective of losing things I need. I think I’ve changed my mind.”
And that’s the conundrum facing the Republican Party going forward. Having created a fiscal time bomb during the Bush administration, they are now born-again deficit hawks, and moreover, profess to think today’s federal government represents a socialist tyranny. But they are even more adamantly opposed to higher taxes, and their base doesn’t want them to touch “their” Social Security and Medicare, which they figure they’ve earned.
Barring a major retraction of America’s active role in the world, which would enable big reductions in defense spending (and we know few conservative Republicans favor that), the only thing left to do is the sort of wholesale elimination of federal functions last attempted by Republicans in 1995, which failed miserably, or an all-out attack on means-tested programs benefitting the poor. By all evidence, this last approach may please many Tea Partiers, but justice and efficacy aside, there is no approach more guaranteed to ensure that the Republican Party’s base gets even older and whiter than it already is.
At some point, the famous “anger” of the Tea Partiers will have to be propitiated by GOP leaders, but there’s no obvious way out of the dilemma Republicans have created for themselves.
This item is cross-posted at The Democratic Strategist.
Photo credit: http://www.flickr.com/photos/ragesoss/ / CC BY-SA 2.0
Tags: Medicare, Public opinion, Republican Party, Social Security, Taxes, Tea Party
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