I still think it’s not entirely clear that a hike in the Medicare eligibility age is definitely on the table in the fiscal cliff talks. And I would urge caution — we still don’t know what’s actually being discussed — before prematurely concluding a “cave” on the issue is imminent.
However, in an interview with ABC News, Obama declined to rule it out. So it’s worth reiterating that raising the Medicare age is a terrible idea. And as I’m sure Obama himself would readily agree, he was not reelected to solve our fiscal problems in part by giving away the Medicare of people who need it.
Here’s what he told ABC News, when asked about this option:
“When you look at the evidence, it’s not clear that it actually saves a lot of money,” he said. “But what I’ve said is let’s look at every avenue, because what is true is we need to strengthen Social Security, we need to strengthen Medicare for future generations, the current path is not sustainable because we’ve got an aging population and health care costs are shooting up so quickly.”
I expect some Congressional Dems will have something to say about this today. Obama has repeatedly indicated he expects to make some kind of sacrifice he and Democrats won’t like in the quest for a fiscal deal, since he sees compromise as a preferable outcome for the country. And it does seem very clear that conservatives will dismiss any entitlement reform that doesn’t harm beneficiaries as insufficient — making it a prerequisite to any deal.
But surely Obama knows that giving in to this seemingly unshakable conservative priority isn’t just any old concession. It’s extremely bad policy (as even Obama himself hinted in the ABC interview), and there are far better ways of extracting Medicare savings (as Obama’s own proposed Medicare cuts indicate). And doing this could hurt lots and lots of people. As I noted yesterday, a new report finds that raising the age could leave hundreds of thousands of seniors (many of them poor) uninsured, because there’s no telling for sure whether Obamacare or Medicaid will be an effective safety net for those booted from Medicare. What’s more, the report finds that it could undermine Obamacare’s goals of controlling health care costs.
If one thing seems clear from the election’s outcome — and from multiple public opinion polls — the American people actually do want that “balanced approach” to solving our fiscal problems Obama repeatedly promised. Obama vowed to act as a bulwark against the GOP zeal to cut spending in damaging ways, not to acquiesce to it at critical moments when Republicans insist on it as the price for compromise. He promised to solve the fiscal mess in a way that avoids harming the poor and vulnerable or compromising the fundamental mission of major social programs. My bet is Obama himself would agree that raising the Medicare age violates the basic principles he ran upon — and has promised to be guided by.
The American people apparently see it that way, too. A new Bloomberg poll finds that by two to one, Americans see the election’s outcome as an endorsement of his pledge to protect Medicare benefits.
As Paul Krugman recently asked: When going over the cliff (and coming back to renew the middle class tax cuts) remains an option, is it really worth trading away two years of Medicare for a deal? I’d genuinely like to know how Obama would answer that question.
* Poll shows Obama has all the leverage: Another reason not to give away two years of Medicare: A new Post poll finds that 53 percent of Americans will blame Republicans if the fiscal talks fail, versus only 27 percent who will blame Obama. Fifty two percent of independents would blame the GOP. Obama holds the middle ground here; it seems obvious that majorities think Obama is the reasonable party — so no reason to give in to unreasonable demands.
* Even Republicans say Obama has mandate to tax rich: Nice catch by Taegan Goddard: In the Bloomberg poll mentioned above, nearly half of Republicans say Obama has an election mandate to raise taxes on the wealthy. That would seem to be at odds with the argument of GOP officials that the election gave them a mandate to hold the line against high end tax hikes.
* White House revises fiscal cliff offer: In private discussions with Boehner, the White House has lowered its demand for new revenues from $1.6 trillion to $1.4 trillion. That’s obviously not a big drop — it’s still $600 billion more than the GOP has offered in revenues via closing loopholes — but as far as I can determine from the reporting, the GOP has not moved an inch from its public position. (mistake fixed)
* GOP still refusing to budge on tax rates: Indeed, this is what we know about the private “counter-offer” that John Boehner made yesterday:
Republican sources close to the talks said the offer made no concessions on the central issue of higher tax rates for the wealthy.
Again: only one side has made major concessions. Dems agreed to over $1 trillion in spending cuts in 2011 — cuts Boehner himself said were significant at the time — and got no tax hikes in return. The White House has offered around $600 billion in spending cuts this time — and would certainly give more if Republicans would move on tax rates, which experts say is the only route to significant revenues.
* Corporate taxes on table in fiscal talks: More from the White House’s latest offer:
The White House has told Republicans it would include an overhaul of the corporate-tax code as part of any deal to reduce the deficit, people familiar with the talks said, a move to court business groups as budget negotiations intensify.
This seems like the latest effort by the White House to drive a wedge between the GOP and business leaders who are growing increasingly antsy about the failure to reach a fiscal deal.
* The job creators come out for tax hikes: Relatedly, as Steve Benen notes, the fact that major business leaders are now pressing for an increase in tax hikes on the wealthy is a very significant development, given that many of them are major GOP stakeholders. Remember, they are also pressing for an end to debt ceiling brinksmanship, another sign Republicans are caught between the Tea Party base and the more pragmatic business wing of the party.
* Michigan signals major test for labor in 2014: Josh Kraushaar has a must read on the real meaning of the Michigan fight for organized labor: In 2014, unions will try to unseat three union-busting GOP governors in three major Rust Belt states — Michigan, Ohio, and Wisconsin. And the stakes are extremely high:
If labor wins, there will be serious second-guessing over Republicans’ aggressive agenda and the results could cost the GOP its base of working-class whites. But if Republicans emerge from 2014 with their governors largely intact, they’ll enter 2016 with a rallying cry, unafraid to call for deep-seated economic reforms as a major element of the party’s future platform.
Remember, the picture is mixed. While labor lost in Michigan and Wisconsin, unions overturned a union-busting initiative in Ohio. All this is a reminder that fights over state legislatures can be just as important as the battles over the White House and Congress in determining what our economy will look like.
* And a nice unmasking of the “right to work” sham: Harold Meyerson has a good column on the larger story here: The collapse of collective bargaining is helping drive the larger stagnation of workers’ incomes, which even some conservatives concede is a major problem, and “right to work” laws do little more than transfer wealth from workers to owners. Also: The signing of the law in Michigan means the “right to work” movement — previously confined to the south, the mountain west and the plains — is now penetrating a major labor stronghold in the industrial midwest.