Democrats Holding the Line on Entitlements

     There are some liberals who still don't trust the President and the Democrats and believe that gutting Social Security, Medicare, and Medicaid is what any Grand Bargain will do. In that regard, however, we have some reason for encouragement after a big piece from the New York Times came out.

     Many Democrats are opposing any major changes to the big three entitlements and believe they have the political mandate to do so.

     "President Obama’s re-election and Democratic gains in Congress were supposed to make it easier for the party to strike a deal with Republicans to resolve the year-end fiscal crisis by providing new leverage. But they could also make it harder as empowered Democrats, including some elected on liberal platforms, resist significant changes in entitlement programs like Social Security and Medicare."

     "As Congress returned Monday, the debate over those programs, which many Democrats see as the core of the party’s identity, was shaping up as the Democratic version of the higher-profile struggle among Republicans over taxes."

     http://www.cnbc.com/id/49978807

     Or read it at the NYTimes-it's easier to quote from CNBC as it's all on one page there.

      http://www.nytimes.com/2012/11/27/us/politics/politics-in-play-over-safety-net-in-deficit-talks.html?pagewanted=2&hp

      Democrats have made clear that Social Security belongs off the table. Dick Durbin made this point on the Sunday morning talk shows.

      http://livewire.talkingpointsmemo.com/entry/durbin-social-security-does-not-add-one-penny#

      The Obama Administration has also ruled out SS cuts
     

      "While a potential change in calculating Social Security increases was part of the talks with Speaker John A. Boehner last year, the White House press secretary, Jay Carney, made clear on Monday that the administration was not considering changes to the retirement program as part of the deficit talks.

     “We should address the drivers of the deficit, and Social Security is not currently a driver of the deficit,” Mr. Carney said.

 

       There has in the past been discussion about raising rates on wealthy beneficiaries increasing the number that must pay top rates. Yet the worry with this is it could turn Medicare into a means tested program-a sure way to cut its public support.

 

      "Max Richtman, the president of the National Committee to Preserve Social Security and Medicare, which represents beneficiaries, said this idea had been “pushed as far as it should be pushed.” Saddled with more and more costs, he said, high-income beneficiaries may eventually want to leave the program."

     “If Medicare turns from an earned benefit into a welfare program,” Mr. Richtman said, “you will see support dissipate.”

 

      One thing that could work:

 

       "Mr. Obama also wants to impose a surcharge on Medicare premiums for older Americans who buy the most generous private insurance to supplement Medicare. The White House and some economists say such Medigap insurance encourages the overuse of medical care because beneficiaries are shielded from most co-payments and other costs. But many beneficiaries are willing to pay for the extra protection, and major insurers derive substantial revenue from the product."

 

       Obama has also considered raising prices on drug company providers. The way in which he structured the $716 billion dollar "cut" in Medicare was very good. It could be that more savings like this-not through cutting beneficiaries-could be the way to go.

 

        Cuts to Medicaid are problematic and now that the SJC made the Medicaid payments in ACA voluntary for states, cutting Medicaid would hurt ObamaCare.

 

         Overall, you have to like what you're hearing from some top Democrats.

 

          "Two staunch liberals, Senators Tom Harkin of Iowa and John D. Rockefeller IV of West Virginia, said in a letter to Mr. Obama that he should “reject changes to Medicare, Medicaid and Social Security that would cut benefits, shift costs to states, alter the structure of these critical programs, or force vulnerable populations to bear the burden of deficit reduction.”

           "More than 40 House members, led by the Congressional Progressive Caucus, declare in a resolution that any deal on taxes and spending “should not cut Medicare, Medicaid or Social Security benefits.”