Okay, everyone’s all a-twitter over debt-ceiling negotiations supposedly being stalled and The Speaker essentially walking out on The President. Some are applauding Obama’s tough-ish talk at his news conference last night, once again aiming at positioning himself as The Grownup in the Room.
Frankly, I’m holding my applause, not my breath. The deficit deal Obama and Boehner were apparently close to reaching was essentially a big win for the Right, and a nightmare for most Americans. More than a trillion dollars in spending cuts, nearly all of it from social programs, including changes to Medicare (higher premiums for upper-income recipients, raising the eligibility age, and so forth) that would have saved $250 billion (not so much discussion on how this would have reduced health care coverage for American seniors, of course), lower Medicaid spending (remember, the poor have far less political clout than seniors) that would have doubtless reduce eligibility and benefits, saving about $110 billion, and Social Security (changing the COLA).
The deal included $1.2 trillion in discretionary spending (this is what most people think of as the federal budget) over 10 years, beginning in FY 2012.
There would have been a complex process for making these cuts, which would begin right away. (Where is the revenue? Stay with me.)
Both the spending cuts and new revenue would be made through instructions to Congress, which means Congressional committees (dominated in the House by Republicans, with Senate Republicans in a very strong minority position) to do the picking and choosing. These instructions would be backed up by a mandate (whether ultimately enforceable is open to question) that, if Congress failed to enact the changes and produce the necessary deficit reduction, there would be automatic reductions to Medicare and Medicaid as well as automatic tax increases, which would probably be in the form of allowing the Bush-era tax cuts to die in 2013.
Reading a good analysis by Jonathan Chait, over at The New Republic, the revenue numbers were bouncing somewhere between $800 billion (Boehner) and $1.2 trillion (Obama).
So even with this deal, the one Boehner apparently walked away from, most of the deficit reduction would come in the form of spending cuts – again, largely social programs – rather than re-setting taxes to pre-Bush levels and making other changed to increase revenue. Even the Bowles-Simpson “catfood commission” and the right-tilting Senate “Gang of Six” recommended higher revenues. In fact, Bloomberg Businessweek is reporting that Go6 proposal may have nudged Obama to ask for more revenue than he had previously, to Boehner’s annoyance – Bloomberg on Go6
Not to sound like a broken record, but it was those tax cuts that created the largest share of the current deficit, following by putting two wars on the national credit card. Those cuts got us the slowest economic growth in decades, greater income inequity, and falling real wages for most Americans. They also made it harder for the federal government to respond when the bottom fell out of the economy, which, from the Republican side, was part of the reason for the cuts anyhow, the “starve the beast” strategy.
Perhaps Obama is finally standing firm, even in support of a bad deal. We’ll see. He had moments of tough talk on health care reform before he caved, then chastised us on the Left for being disappointed, as though we were sullen children. Then he did it again last December, allowing the Bush-era tax cuts to continue, saying he didn’t have time to play games with the budget.
Well, those games continue. The Republicans see zero advantage to giving in on anything regarding taxes. They have sensed weakness in Obama all along, and the more reckless of them are willing to push America into default to get their way.
So, it looks from here like most of us are going to lose – some of us, big time – whatever comes out of this lunacy, and the Right will be closer to its goal of destroying the social safety net. Whether they know it or not – or care or not – they are also destroying America’s middle class and relegating hundreds of millions of people to future lives of greater struggle and less security.
Rot in hell, you lot.