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Posted at 1:55 PM ET, 02/15/2011

Obama's debt of promises

By Stephen Stromberg

President Obama, as with so many others in Washington, is deep in debt. He's asking Americans to give him yet more time to consider tackling Medicare, Medicaid and Social Security spending. And in return, he's promising to try to reform these politically sacred programs -- soon, and for real.

The president's widely criticized 2012 budget proposal, which came out Monday, didn't touch these entitlements, even though Medicare and Medicaid are set to balloon the national debt rapidly after 2020. So he called a news conference Tuesday to defend his plan.

His budget, Obama said, wasn't supposed to be a long-term solution to America's problems. His plan for fiscal year 2012 is to "stabilize" spending. He'll take on entitlements next.

How? Not with some "Obama plan," the president said Tuesday. And not really with the detailed proposal his fiscal commission released late last year, which, he said, provides only "a basic framework." But he said he will consider the fiscal commission's work and speak to Republicans and liberal Democrats seriously about the issue. The strategy still seems to not get too far ahead of anyone else in Washington.

"You guys are pretty impatient. If something doesn't happen today, then the assumption is that it's not going to happen," the president said. "This is not a matter of 'you go first' or 'I go first.' This is a matter of everybody having a serious conversation about where we want to go and then ultimately everybody getting into that boat at the same time so it doesn't tip over."

But these are the sorts of things heard during the 2008 campaign -- we'll offer plans for real entitlement reform when we've dealt with other pressing issues. (Such as, presumably, winning the election.) Americans heard it during the stimulus debate -- we'll have serious talk on deficits and entitlement spending after we restabilize the economy. "It's true that this is my third budget," Obama acknowledged Tuesday. "My first two budgets were in the midst of the worst recession since the Great Depression. So we had another set of priorities."

Fair enough. But now the line is: We'll push hard and publicly on entitlements after we get through my budget for next year, and after we persuade Republicans and liberal Democrats to be reasonable. Maybe the president will pull something off, after all. But the pattern is getting ominous -- and the excuses less convincing.

By Stephen Stromberg  | February 15, 2011; 1:55 PM ET
Categories:  Stromberg  | Tags:  Stephen Stromberg  
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Incredible how you demand Obama solve the entitlement "crisis" (a Republican talking point--the only "crisis" is in health care costs, which include Medicare, which is why it affects the government--but every American is affected by this).
Obama puts through cuts in Medicare, the Reps run against this and win the elderly by 24%, and Obama is supposed to propose more cuts.

Let's be clear--the budget is out of balance (90% of it) because W cut taxes on the rich, fought two wars on credit, and then, through Katrina-style oversite of the financial sector, brought on the Great Recession, which Obama managed to keep from becoming Great Depression II.
The best way to balance it is to rescind the Bush tax cuts and have a high enough level of government spending to keep demand up until the private economy recovers (it takes, historically, about 5 years after a financial crisis). Yet we can't rescind because of Republican filibuster and we can't keep government spending up (aid to the states would be the most effective).

Health care costs then need to be brought in line with other G-7 countries (Medicare for all is the easiest way to do this--Obamacare is a start using the private market). That would solve the "crisis". The WaPo's solution apparently is to cut off nutrition for pregnant women and impoverish the elderly.

Posted by: garbage1 | February 15, 2011 3:03 PM | Report abuse

"But the pattern is getting ominous"

The pattern is that he got health insurance reform, credit card reform, financial regulation reform, student loan reform, DADT repeal, and a mess of other things done--after the media and so-called allies complained that he was taking too long and would never get these things done. None of these things are 100% perfect, but they are solid platforms for growth and we're better off having them than not having them.

And he's got a fair point about the press being impatient; witness the number of reporters who jumped on Panetta's assessment of Egypt, saying that he was wrong about Mubarak being ready to step down--and then it turned out Panetta was only off by less than a day. Or the Shirley Sherrod debacle (the Obama administration shared a lot of the blame in that, to be fair, but investigative reporters fell down on the job too). The Washington Post had headlines in the morning about how she was proof of racism against white farmers, and then by that afternoon y'all had to play like you hadn't just immensely jumped the gun.

The ominous pattern I'm seeing does not concern the president, it concerns the press.

Posted by: dkp01 | February 15, 2011 3:27 PM | Report abuse

If Obama wants the Republicans and Democrats to be adults, then he should lead by example. We are all fet up with rhetoric and we need action, not more rhetoric.
Yes, I understand his budget was not comprehensive; just a starting ground for Reps and Dems to develop something better.
I sincerely hope they do!

Posted by: hebe1 | February 15, 2011 3:28 PM | Report abuse

Obama votes present once again. The president will not lead.

Posted by: bandmom22 | February 15, 2011 4:44 PM | Report abuse

Dkp01 wrote: The pattern is that he got health insurance reform, credit card reform, financial regulation reform, student loan reform, DADT repeal, and.....they are solid platforms for growth.
You clearly have no understanding of economics, zero, zip, nada.

Health insurance reform did nothing to contain costs, it just added 32 million to a broken system. The taxes alone will suffocate the economy, not help it. CBO said last week the bill will cost 800,000 jobs. And if you believe the cost estimates, you'll believe anything Obama says.

Credit card reform: Are you serious? Get a new credit card today and you'll pay a higher percentage than before the bill was passed. Great success? Not.

Finance reform: Banks are still allowed to leverage their investments by 25 to 1. Bank stocks have skyrocketed since the reform, a strong indication it had little affect on the banks. But for you to get a loan...a lot tougher due to the regulations.

Student loan reform does nothing for the economy.

You certainly qualify for an econ job in the White House. They are just as clueless as they have only a couple people who have ever hired anyone. Keep drinking the Obama koolaid, he needs as many gullible people as possible to believe his crap.

Posted by: Tostitos | February 15, 2011 4:52 PM | Report abuse

So Washington politicians have 'borrowed' the $2.5 trillion in surplus funds we have paid into Social Security over the last 26 years.
Now they want to 'reform' it, by cutting our benefits.
Unless you like being taxed twice, it's time to speak up.
Don't reform Social Security, pay it back!

Posted by: mtpeaks | February 15, 2011 6:33 PM | Report abuse

Yo Tostitos, you are clearly qualified for a Bush WH econ job: "Health insurance reform...added 32 million to a broken system." Either you pulled that number out of thin air or you are really bad at trying to parrot dittohead talking points. Nice try though I guess--A for effort!

Posted by: nickthap | February 15, 2011 7:13 PM | Report abuse

BTW Tostitos, CBO also said that repealing HCR will ADD $230 billion to the debt (see, page 5: "...the effect of H.R. 2 [repeal of HCR] on federal deficits as a result of changes in direct spending and revenues is likely to be an increase in the vicinity of $230 billion."

Posted by: nickthap | February 15, 2011 7:18 PM | Report abuse

..."these are the sorts of things heard during the 2008 campaign -- we'll offer plans for real entitlement reform when we've dealt with other pressing issues."

..."now the line is: We'll push hard and publicly on entitlements after we get through my budget for next year, and after we persuade Republicans and liberal Democrats to be reasonable. Maybe the president will pull something off, after all. But the pattern is getting ominous -- and the excuses less convincing."

Excuses? REALLY. Please tell me how Obama is going to do something without the GOP lowering the cannons and firing away at WHATEVER he proposes.

Indeed yes, "we are not in a campaign now.".. which means it's time for the Republicants to come to the table and negotiate (which involves committing to a plan, a program, some action) and agree to SOMETHING concrete and ready to put into LAW. Yes, it's no longer a campaign. Obama is saying let's stop the public pronouncements, get together and make some decisions. And come up with some concrete actions.


I'll believe it when I see it.

Posted by: Bill_USA | February 15, 2011 7:20 PM | Report abuse

Looking at 2009 real dollar amounts from the usgs web site without gimmicks and projections, here are the facts.

Social security spending was $683B against $654B revenues. The 4% deficit is easily covered from the trust fund, just pay it back. Compare it to the federal employee pensions and health care of $56B with $8B in revenues. The 571% deficit is made this large by the gimmickry used to make the pensions spending to appear smaller, but still, why don't we hear politicians wanting to reform their government pensions and health care?

Medicare spending was $430B against $289B revenues. The 49% deficit is unsustainable, and the program clearly needs to be fixed.

Unemployment spending was $122B against $38B revenues. The 223% deficit is caused by the recession and corresponding surplus should / could be built during the growth years for just such occasion.

The remaining government spending was $2,759B against remaining tax revenues of $1,260B - that is 119% deficit and also the bulk of the problem.

From what I see, the government budget needs to be brought into balance rather drastically and Medicare needs to be fixed, but less urgently. Social Security is
in good shape, self sustaining for at least another 15 years, and for now it should be left alone.

Posted by: awells1902 | February 15, 2011 8:06 PM | Report abuse

Obama's healthcare plan will add one fifth of the country, 50 million people onto our Medicaid rolls with no way to pay for them.

There is no money in the social security trust fund. So there are no reserves. Congress borrows money from China to pay for social security. The information is available but we hear nothing from the politicians or reporters on this appalling situation where Congress neglected to properly fund the social security trust fund.

Our soaring Medicare/healthcare costs are consuming our GNP. Healthcare reform needs to contain these costs in some kind of long term plan. No one mentions looking at various European models. There is no discussion of how we can contain costs from over consumption of healthcare, these costs are not due to abuse. They are due to overconsumption.

Unless our entitlements and defense costs are contained our economy will never recover, jobs will not be created and we will lose, as we are already, our ability to compete with other countries who have their entitlements, healthcare costs and defense costs under control.

Posted by: jsands2 | February 16, 2011 8:06 AM | Report abuse

FYI - Our gay troops are saying "Do Ask, Do Tell" now at - the New Social Network for Gay Service Members.

Posted by: skoa | February 16, 2011 10:05 AM | Report abuse

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