Wonkbook: GOP promises their budget will include entitlement reform
The GOP says it wants to work with Obama on entitlement reform, and that the budget House Republicans are writing will give specifics on how. Obama says he wants to work with the GOP on entitlement reform, and that "if you look at the history of how these deals get done, typically it’s not because there’s an Obama plan out there; it’s because Democrats and Republicans are both committed to tackling this issue in a serious way." So, with the president and his congressional opposition committed to the effort, entitlement reform should be a sure bet, right?
We'll see. I wouldn't be surprised if Obama has his name on a broader deficit-reduction bill at this time next year. If he takes the deficit away from Republicans before 2012, his reelection campaign becomes considerably easier. And on a less cynical level, his administration is stocked with deficit hawks -- the same folks who actually balanced the budget under Bill Clinton. And similarly, Republicans want to deliver on the deficit-reduction promises they've made to their base. In theory, everyone's incentives and ideologies are pointing in the same direction. That's a good sign for progress.
But this conversation gets dangerous when it gets specific, which is why, traditionally, members of both parties try to house entitlement reform in processes that allows both parties to sign onto the same bill at the same time and give each other cover. That's what the Obama administration was waiting for: Their budget had a section on Social Security reform, but it was a set of principles to take into a closed-door, bipartisan negotiation. I'd bet the Republican Party is about to come to appreciate that model: They don't want to endorse a draconian set of changes to Medicare, Medicaid, and Social Security only to find themselves far to the right of the eventual compromise and stuck defending unpopular ideas that never made it into law. That's why they've been so cool to Paul Ryan's Roadmap, for instance. But the ferocity of their attack on the president's budget, and the expectations of many in their base, are going to make it hard for them to come out with anything modest. Obama has left them in a very tough spot, which is part of the reason they're so annoyed with him and his budget.
The House GOP wants to work with Obama to reform entitlements, report Lori Montgomery and Shailagh Murray: "Some Republicans, particularly those in the House, want to force an immediate showdown with Democrats: GOP leaders have included sharp cuts to federal agencies in a must-pass spending measure that would keep the government open through September. Other Republicans, including many longtime senators, want to seize the moment to join Democrats in overhauling politically sensitive programs such as Social Security and Medicare, the biggest drivers of future spending...'Entitlement reform will not be done except on a bipartisan basis with presidential leadership,' Senate Minority Leader Mitch McConnell (R-Ky.) told reporters."
And the GOP will include such reform in its own budget proposal, reports Felicia Sonmez: "House Republican leaders announced Tuesday that their federal budget for the 2012 fiscal year will include an effort to reform entitlement programs including Medicare, Medicaid and Social Security...In their statement, House Speaker John Boehner (Ohio), Majority Leader Eric Cantor (Va.), Majority Whip Kevin McCarthy (Calif.), House Republican Conference Chairman Jeb Hensarling (Texas) and House Budget Committee Chairman Paul Ryan (Wis.) charged that the budget proposed by President Obama on Monday 'punts on entitlement reform and actually makes matters worse by spending too much, taxing too much, and borrowing too much -- stifling job growth today and threatening our economic future.'"
"The President says that he wants to win the future, but we can't win the future by repeating the mistakes of the past or putting off our responsibilities in the present," the Republican leaders said in their statement. "Our budget will lead where the President has failed, and it will include real entitlement reforms so that we can have a conversation with the American people about the challenges we face and the need to chart a new path to prosperity."
Obama used a press conference to defend his approach to the budget, report Perry Bacon, Lori Montgomery, and Brady Dennis: "President Obama strongly defended his $3.7 billion blueprint for federal spending in a news conference on Tuesday, rejecting criticism that he should have proposed a more specific plan to reduce the long-term budget deficit...Speaking after his budget director and treasury secretary faced sharp questioning by Republicans on Capitol Hill, Obama denied that his budget does little to address the big entitlement programs - Medicare, Medicaid and Social Security -- that together account for more than 40 percent of federal spending...Obama hinted he has already started talking to GOP leaders about entitlement reform, although neither side has discussed details of such talks."
Read the transcript: http://bit.ly/eI4ZVX
My take: This fits the approach the Obama administration has taken to most all its major reform efforts. "The Obama administration's theory of policymaking amid divided government is a frustrating one. What most people want from the president is to lead. And leading, in this case, means giving a speech, getting behind some unpopular ideas, trying to change public opinion. It means acting like Jed Bartlet in the final five minutes of an episode of 'The West Wing.'...But the White House has come to the conclusion that that type of leadership doesn't work. It believes that the quickest way to kill a controversial proposal in a polarized political system is to have the president endorse it. Once a high-profile proposal is associated with the White House, Republicans (correctly) view its passage as a threat to their political fortunes. That's why the Obama administration didn't endorse a payroll tax holiday until after the election, when it emerged as part of the tax deal. Endorsing it before the election would've ;poisoned the well,; one administration official told me after. Republicans would have had to attack it, and that would have made it impossible for them to endorse it later.
[Bob] Greenstein sees a similar theory at work in the budget. 'I don't think Obama could’ve been clearer that he wants a bipartisan commission on Social Security like they had in the early '80s,' he says. 'But if you look at what came out of that commission, if those items had been in Reagan's budget the previous February, they would've been dead in 30 days.'"
House speaker John Boehner has endorsed federal job cuts, reports Ed O'Keefe: "House Speaker John Boehner dismissed concerns Tuesday about the potential for federal job cuts, saying he thinks the government can't afford to keep so many workers. The Ohio Republican was asked at his weekly news conference about the prospect of federal job cuts if a House GOP plan to trim $100 billion in government spending passes. 'Over the last two years since President Obama has taken office, the federal government has added 200,000 new federal jobs,' Boehner said. 'And if some of those jobs are lost in this, so be it. We're broke. It's time for us to get serious about how we're spending the nation's money.' The reporter who asked the question noted, however, that the government might have to pay federal unemployment assistance to laid-off workers, potentially adding more costs."
Fact check: I've been playing around with the BLS data on this and it looks like the change in federal workers between this month and January, 2009, is on the order of 58,000 workers, not the 200,000 Boehner mentioned. The exact numbers are 2,792,000 then, and 2,850,000 now. You can check my math here.
Dana Milbank is not happy: http://wapo.st/fMjpVe
Obama has formally issued a veto threat against the GOP budget, reports Glenn Thrush: "President Barack Obama on Wednesday threatened to veto a House Republican effort to slash about $100 billion from this year’s budget - a largely symbolic move meant as a warning to Republicans seeking to extract big new spending cuts from the White House...His Office of Management and Budget...released a 'Statement of Policy' saying Obama would not sign off on anything that jeopardized growth or defense. 'If the President is presented with a bill that undermines critical priorities or national security through funding levels or restrictions, contains earmarks, or curtails the drivers of long-term economic growth and job creation while continuing to burden future generations with deficits, the President will veto the bill,' read the statement."
Canadian pop interlude: Blue Hawaii plays "Blue Gowns" live.
Got tips, additions, or comments? E-mail me.
Want Wonkbook delivered to your inbox or mobile device? Subscribe!
Still to come: House Republicans want to block derivatives regulations; Sen. Max Baucus may not bring Medicare/Medicaid administrator Donald Berwick's nomination up for a vote; a GOP lawmaker is not happy with his party's spending cuts; Congressional Democrats are protesting heating subsidy cuts in the budget; and Natalie Portman cries, a lot.
House Republicans want to block Dodd-Frank's derivatives regulations, reports David Hilzenrath: "Corporate groups are protesting that some of the derivatives regulations could be bad for business, and they are urging the government to move more slowly. House Republicans, who overwhelmingly opposed Dodd-Frank, are arguing that regulation could undercut the U.S. derivatives industry, destroying jobs and driving business overseas. A 'freight train' of regulation 'could literally spell the end of U.S.-based derivatives markets,' Rep. Scott Garrett (R-N.J.) said Tuesday at a hearing of the House Financial Services Committee. Democrats countered that unregulated derivatives have already destroyed jobs and forced the government to bail out Wall Street. 'There seems to be a mass case of amnesia,' Rep. Ed Perlmutter (D-Colo.) said."
A GOP lawmaker is not happy about the spending cuts his party is proposing, reports Molly Hooper: "Rep. Steven LaTourette (R-Ohio), who is spearheading the effort for centrist Republicans, has balked at the $61 billion reduction plan offered by House GOP leaders. 'While I wholeheartedly support the $100 billion reductions (when compared to President Obama’s 2011 budget request), I could argue that it’s not regionally fair and that winners and losers were picked among the programs,' LaTourette told The Hill on Tuesday."
Households are saving more, reports Neil Irwin: "The recession that just rocked the U.S. economy happened in part because Americans were borrowing and spending more than they could afford. Now, three years after the downturn began, families are moving faster than many analysts had expected to put their finances in order by paying down debt and boosting their savings. That bodes well for the recovery. Once Americans get their savings to a comfortable level, they can increase their spending all over again - but this time without necessarily going into hock - and give the economy a badly needed lift. Compared with the summer of 2008, when consumer debt peaked, Americans now have 7 percent less mortgage debt, 12 percent less in auto loans and 15 percent less credit card debt, according to the Federal Reserve Bank of New York."
Business groups oppose Obama's proposed highway bill, reports Josh Mitchell: "The U.S. Chamber of Commerce and other business lobbies called President Barack Obama's proposal for a six-year, $556 billion highway bill unrealistic Tuesday, saying no one's explained how to pay for it. The existing transportation trust fund would need $231 billion in additional revenue over the six-year period to fully pay for the proposed programs, according to Mr. Obama's 2012 budget blueprint...U.S. Chamber President Thomas Donohue and AFL-CIO President Richard Trumka are scheduled to testify Wednesday before the Senate Environment and Public Works Committee on the need for a major transportation bill to create jobs."
Egypt's growth depends on getting more urban, writes David Leonhardt: "When Hosni Mubarak took power in 1981, Egypt was indeed more urban than the rest of the world. About 44 percent of its population lived in cities. In East Asia, by comparison, only 26 percent of people lived in cities. Since then, the cities of Asia have expanded rapidly, drawing in millions of peasant farmers looking for a better life — and, more often than not, finding it. Almost 50 percent of East Asians now live in cities. And Egypt? It is the only large country to have become less urban in the last 30 years, according to the World Bank....This urban stagnation helps explain Egypt’s broader stagnation.”
Don't get too excited over the budget, counsels Steven Pearlstein: "Most of the $4 trillion that is slated to be added to the government's debt during President Obama's first term is the result of tax cuts that the country could not afford plus a very bad recession that drastically reduced revenue and increased spending. That doesn't mean there isn't a serious long-term structural deficit that needs to be addressed, but that was baked into the cake long before Obama arrived in Washington. He can be blamed for not yet stepping forward with a plan to deal with that structural deficit but no more than most of his Republican critics, who have yet to come up with a credible plan themselves. All the shouting this week about where and how much to cut domestic discretionary spending is wildly overdone."
Plan your own budget cuts with the Center for American Progress' "chopping block" interactive tool: http://bit.ly/i6rKpw
Great moments in acting interlude: A supercut of Natalie Portman crying.
Sen. Max Baucus may not support Medicare/Medicaid administrator Donald Berwick's nomination, reports Jennifer Haberkorn: "Senate Finance Committee Chairman Max Baucus isn't ready to commit to a confirmation hearing for Don Berwick, the controversial head of the Centers for Medicare and Medicaid Services. 'I haven't decided yet,' he told POLITICO on Tuesday.President Barack Obama renominated Berwick to the post last month. Berwick received a recess appointment in July after senators failed to act on his nomination amid fierce Republican opposition. If he is not confirmed, he will have to leave the post at the end of the year. But Republicans are still angry over the recess appointment and there's no sign any of them have changed their minds about him."
The IRS wants more funding to enforce health care reform: http://politi.co/f8Ps6z
The Government Accountability Office has found billions in waste in Medicare and Medicaid, writes Comptroller General Gene Dodaro: "In fiscal year 2010 alone, Medicare had estimated improper payments of almost $48 billion; this estimate did not include improper payments in its prescription drug benefit program, for which the agency has not yet determined a total amount. And because Medicare remains on a path that is fiscally unsustainable over the long term, there is heightened pressure to improve its payment methods, as well as its management and oversight of program operations and patient care...The Department of Health and Human Services has estimated a national improper payment rate for Medicaid of 9.4 percent (with the federal share estimated at $22.5 billion) for fiscal year 2010."
Democratic political operatives are building an organization to counter Rep. Darrel Issa's investigations: http://politi.co/egsPBm
Former DC schools chancellor Michelle Rhee is allying with Republicans, report Ben Smith and Byron Tau: "Rhee, 41, has pivoted hard and emerged, ironically enough, as a national political force to be reckoned with...She’s an adviser to some of the nation’s most ambitious Republican governors, like Florida’s Rick Scott, New Jersey’s Chris Christie and Indiana’s Mitch Daniels, who envision a more apocalyptic confrontation with teachers unions. And among Republican candidates for the 2012 presidential nomination, there’s something of a Rhee primary underway, with potential candidates regularly dropping her name as a path to both policy credibility and Beltway buzz. Minnesota Gov. Tim Pawlenty refers to her as 'superwoman,' citing the education policy film 'Waiting for Superman.'"
There's not much money in means-testing Social Security, writes Kevin Drum: "Social Security is already means tested: your benefit level is calculated as 90% of your first $749 in monthly pre-retirement earnings, 32% of earnings up to $4,517, and 15% of your earnings above that. This means that high-income earners get a smaller benefit as a percentage of their income than low earners do. One way to means test even more would be to reduce the third 'bend point' to, say, 10% of earnings above $4,517. This would decrease benefits for the well off without touching benefits for anyone else, and it's easy to do since the system is already built with this structure in place. In fact, this is exactly the recommendation of the Rivlin-Domenici deficit reduction report. So how much does it save? Answer: $59 billion in 2040, which is a grand total of 1.6% of the savings in their entire Social Security plan."
Adorable animals in groups interlude: A seemingly limitless supply of puppies wake up to eat.
Congressional Democrats are pledging opposition to heating cuts, reports Mike Lillis: "Democrats from winter-weather states are lining up in droves to oppose a White House proposal to slash heating assistance for low-income families. The lawmakers -- including some senior Democrats -- warn the cuts would very literally leave some of their most vulnerable constituents out in the cold. 'It would have real-world consequences for some pretty powerless people,' Rep. Peter Welch (D-Vt.) said Tuesday. 'People would literally freeze.' Rep. Rosa DeLauro (D-Conn.) warned the cuts could force low-income families to cut back on cooking meals to stay warm. 'They'll buy a space heater and put their lives in danger,' DeLauro told reporters. Senate Democrats have also slammed the energy cuts. 'Talk about misplaced, off-track priorities,' said Sen. Jon Tester (D-Mont.)."
GOP Senators have targeted the Fishing and Wildlife Service for its work on climate change: http://bit.ly/hjJGT3
GOP Sen. Richard Lugar will give his bipartisan energy bill another try, reports Ben Geman: "Sen. Dick Lugar (R-Ind.) said his office is in touch with Democrats as he plans to reintroduce a sweeping energy bill. 'We are in very complex conversations,' Lugar said in the Capitol on Monday evening. 'Our reach has been on both sides of the aisle.'...Lugar floated an earlier version of the bill, which is aimed at curbing oil reliance and reducing emissions without cap-and-trade, last year. His plan included required long-term increases in vehicle efficiency; enhanced building codes; the building of retrofit programs; expanded loan guarantees for nuclear power plants; new federal support for industrial energy efficiency gains; and many other measures."
The budget cuts could threaten clean water, writes Karen Steuer: http://bit.ly/dLXAlT
Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams. Photo credit: Pablo Martinez Monsivais Photo.
Posted by: lauren2010 | February 16, 2011 7:51 AM | Report abuse
Posted by: oconjudy | February 16, 2011 8:00 AM | Report abuse
Posted by: vageorge | February 16, 2011 8:18 AM | Report abuse
Posted by: grooft | February 16, 2011 8:19 AM | Report abuse
Posted by: visionbrkr | February 16, 2011 8:20 AM | Report abuse
Posted by: ohioan | February 16, 2011 8:22 AM | Report abuse
Posted by: peterg73 | February 16, 2011 8:34 AM | Report abuse
Posted by: JBfromFL | February 16, 2011 9:01 AM | Report abuse
Posted by: justin84 | February 16, 2011 9:06 AM | Report abuse
Posted by: Ezra Klein | February 16, 2011 9:12 AM | Report abuse
Posted by: lauren2010 | February 16, 2011 9:18 AM | Report abuse
Posted by: lauren2010 | February 16, 2011 9:20 AM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 9:42 AM | Report abuse
Posted by: visionbrkr | February 16, 2011 10:08 AM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 10:08 AM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 10:14 AM | Report abuse
Posted by: visionbrkr | February 16, 2011 10:32 AM | Report abuse
Posted by: justin84 | February 16, 2011 10:45 AM | Report abuse
Posted by: krazen1211 | February 16, 2011 10:54 AM | Report abuse
Posted by: krazen1211 | February 16, 2011 10:54 AM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 11:04 AM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 11:09 AM | Report abuse
Posted by: novalifter | February 16, 2011 11:13 AM | Report abuse
Posted by: justin84 | February 16, 2011 11:27 AM | Report abuse
Posted by: visionbrkr | February 16, 2011 11:30 AM | Report abuse
Posted by: krazen1211 | February 16, 2011 11:32 AM | Report abuse
Posted by: krazen1211 | February 16, 2011 11:35 AM | Report abuse
Posted by: justin84 | February 16, 2011 11:52 AM | Report abuse
Posted by: lauren2010 | February 16, 2011 1:21 PM | Report abuse
Posted by: RichardHSerlin | February 16, 2011 2:33 PM | Report abuse
Posted by: johnmarshall5446 | February 16, 2011 3:35 PM | Report abuse
Posted by: lauren2010 | February 16, 2011 3:44 PM | Report abuse
Posted by: newdad | February 17, 2011 9:44 AM | Report abuse